Markets on Wall Street are poised to open with losses today after the Federal Reserve said it may not cut interest rates next year by as much as it previously thought, according to the Associated Press.
On Wall Street, futures for the S&P 500 were down 0.8% before the bell, while futures for the Dow Jones Industrial Average fell 0.6%.
That follows losses Wednesday after the Fed held its main interest rate steady at its highest level in more than two decades, as expected. Officials also indicated they may raise the federal funds rate once more this year as they try to get inflation down to a 2% target.
Perhaps more importantly for the market, Fed officials also suggested they may cut rates next year by only half a percentage point. Three months ago, they were penciling in a full percentage point of cuts in 2024.
The Fed’s chair, Jerome Powell, said the Fed is close to hitting the peak on rates, if it’s not there already; however, he stressed that forecasts about where rates and other indicators are heading could change as more data comes in.
High rates hurt prices for all kinds of investments, especially technology stocks, and the news cast a pall on early trading today.
On the corporate side, FedEx jumped after it easily beat profit expectations and raised its full-year profit forecast. Shares rose more than 5% in premarket.
Technology conglomerate Cisco said it will acquire cybersecurity company Splunk for $157 per share in cash in a deal approaching $28 billion in equity value. Cisco shares fell nearly 4% before the bell while trading in Splunk was halted.
In other trading today, U.S. benchmark crude oil lost 60 cents to $89.06 a barrel in electronic trading on the New York Mercantile Exchange. It gained 82 cents on Wednesday. Brent crude, the pricing basis for international trading, declined 68 cents to $92.85 a barrel.
The U.S. dollar slipped to 147.90 Japanese yen from 148.35 yen.
