Stock market today: US futures slip again as interest rate cut pessimism takes hold
AP Photo/Jason DeCrow
- US stock futures slid again in Wednesday's premarket trading.
- Traders have started to bet that the Federal Reserve will delay rate cuts until later this year.
- US Treasury yields held steady after hitting their highest level this year on Tuesday.
US stocks looked poised to slip again on Wednesday as signs of resilience in the US economy threatened to scupper traders' hopes for a June interest-rate cut.
Futures for the S&P 500 and the Nasdaq 100 were down 0.2% shortly before 5 a.m. ET, while the Dow Jones Industrial Average was on course to open about 20 points lower.
Yields on 10-year US Treasury notes held steady, having ticked up 20 basis points to set a fresh 2024 high over the first two days of the week. 2- and 30-year yields were also flat.
Stocks are coming off their worst day in nearly a month after hotter-than-anticipated job openings and factory data led to the market trimming back its rate cut expectations.
About 40% of traders now think that the Federal Reserve will hold borrowing costs at their current level through June, according to the CME Fedwatch tool.
The economy's resilience has "led to fresh risk-off sentiment spreading, as worries brew about inflation staying doggedly above target and the Fed being potentially forced to hold off from cutting rates by as much as previously forecast this year," Hargreaves Lansdown's head of money and markets Susannah Streeter said.
"As concerns about higher interest rates lingering for longer percolate, Wall Street is set for a lackluster session," she added.
Other blue-chip indexes around the world also struggled on Wednesday, with Tokyo's Nikkei 225 closing 1% lower and Europe's Stoxx 600 down 0.1% at last check. In London the FTSE 100 was down 0.45% in morning trading.