US stock index futures saw an uptick on Thursday, buoyed by significant gains in chipmakers like Micron Technology, and reassurance from the Federal Reserve's continued projection of three rate cuts this year. This optimism follows the S&P 500 reaching a record high on Wednesday, spurred by the Fed's decision to maintain current borrowing costs and its forecast to lower interest rates by three-quarters of a percentage point by the end of 2024.
The market's anticipation for a Federal Reserve rate cut in June has surged, with the CME FedWatch tool indicating a 76.4% probability, a notable increase from around 56% at the week's start.
Sam Stovall, CFRA's chief investment strategist, highlighted the Federal Open Market Committee (FOMC) meeting's dovish outcome, aligning with the market's expectations for three rate cuts this year, starting by mid-year, as confirmed by Chair Powell's acknowledgment of the market's June rate cut expectations.
Micron Technology experienced a significant pre-market jump of 16.8% after reporting an unexpected quarterly profit and projecting third-quarter revenue surpassing estimates. This positive news also lifted peers, with Intel and Nvidia each gaining over 1%, and Western Digital seeing a 6% increase. Investors are now keenly awaiting further economic indicators, including weekly jobless claims and business activity data.
Early trading showed Dow e-minis up by 116 points (0.29%), S&P 500 e-minis rising by 21.75 points (0.41%), and Nasdaq 100 e-minis increasing by 138.25 points (0.75%). Premarket trading also saw most rate-sensitive megacap growth and technology stocks advancing, despite Apple dropping 1.1% amid reports of an impending antitrust lawsuit by the U.S. Department of Justice.
