New York, New York – Stock futures showed an increase in early trading on Thursday following the Federal Reserve’s decision to maintain its forecast for two interest rate cuts in 2025. Futures tied to the Dow Jones Industrial Average rose by 0.31%, while S&P 500 futures saw a nearly 0.45% increase, and Nasdaq 100 futures climbed about 0.58%.
Despite keeping the federal funds rate steady at a range of 4.25% to 4.5%, the central bank decided to stick with its projection of two rate cuts later this year. This decision came even as the economic forecast pointed towards higher inflation and lower economic growth in the future.
Stocks experienced a rebound, recovering from a period of decline that had been ongoing since February. The Dow increased by 0.9%, the S&P 500 surged by just over 1%, and the Nasdaq Composite gained 1.4%, although it remains more than 10% off its previous high.
In response to concerns about inflation due to tariffs, Federal Reserve Chair Jerome Powell described the potential impact as likely to be short-lived. This assessment was welcomed by investors, who seemed reassured that the Fed would be able to manage any lasting inflationary pressures.
Market analysts noted that the recent market volatility caused by tariff policies, particularly those implemented by President Donald Trump, could potentially be assuaged with the assurance of the central bank’s ability to control the situation. Trump’s recent decision to temporarily exempt certain imports from duties has also been a point of interest for investors.
On the economic front, investors are keeping an eye on various indicators, including weekly jobless claims data, the Philadelphia Fed’s manufacturing survey, and a report on existing home sales. Additionally, quarterly earnings reports from companies such as Darden Restaurants, Nike, FedEx, and Micron Technology are expected to provide further insight into the economic landscape.