The Nasdaq Composite closed at a record 27,477.31 on Monday as traders slashed their bets on an October Federal Reserve rate hike. Nvidia led the advance to a record $5.76 trillion market value, while futures edged higher in Tuesday's Asian trading as investors turned to the start of earnings season.
U.S. stock futures inched higher in Asian trading on Tuesday after the Nasdaq Composite closed at a record high the previous session, as reduced expectations for a Fed rate hike this month kept buyers in control. Investors are now turning their attention to the start of the quarterly earnings season.
Futures extend Monday's rally
Dow Jones Futures rose 0.3% to 51,711.0 points by 02:46 ET, while S&P 500 Futures inched 0.2% higher to 7,841.25 points and Nasdaq 100 Futures rose 0.2% to 31,392.75 points. In Monday's regular session, the Nasdaq Composite rose 1.1% to a record 27,477.31, while the S&P 500 gained 0.7%, bringing it close to its own record. The Dow Jones Industrial Average added 0.2%.
Tech shares lead, Nvidia hits a record
Technology shares led the advance, with Nvidia rising 2.1% to a record market value of about $5.76 trillion, while Microsoft, Meta Platforms and Tesla also gained.
Rate-hike odds tumble after jobs report
The gains extend a rally that began after Friday's employment report showed U.S. job growth slowed more than expected in September, prompting investors to sharply scale back rate-hike bets for the Fed's October meeting. Traders now see about a 20% chance of an October rate hike, down from roughly 70% a week earlier, according to CME FedWatch data. A December increase remains largely priced in.
Even so, the softer rate outlook has supported equities while borrowing costs stay elevated. The 10-year Treasury yield rose to 5.31% on Monday, near 2002 highs, as investors continued to weigh heavy government debt issuance and persistent inflation risks.
Earnings and Fed minutes next
Investors are now looking toward corporate earnings for the next catalyst. Third-quarter results from major U.S. banks are due to begin next week, while PepsiCo and Delta Air Lines are among the companies scheduled to report this week. The Fed's minutes from its September meeting, due Wednesday, will also be closely watched for clues on how policymakers view inflation and the softer labor market.
Source: Investing.com
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