US. Stock index futures were significantly higher Thursday morning after the Federal Reserve signaled potential rate cuts later this Wednesday.
At 6:47 CET, the Dow futures pointed to a positive open of more than 226 points. Futures on the S & P and Nasdaq were also higher.
The Fed has lowered its 10-year government bond yield below 2% for the first time since November 2016. Investors are offering higher stock futures overnight as the benchmark for mortgage rates and corporate bonds has fallen. The yield was 2.8% in January.
The Fed signaled Wednesday that interest rate cuts could come as early as July. Policymakers agreed to face growing global and domestic economic risks as they took stock of growing trade tensions and mounting inflation concerns.
Most Fed policy makers cut their key rate outlook by about half a percent for the remainder of the calendar year While Chairperson Jerome Powell said others agree that the case for lower prices is worsening.
Netflix and Amazon shares, which have led the bull market of the last 1
Many market participants appreciated the general tone of the US Federal Reserve more cautiously than expected. According to the CME FedWatch tool, traders now expect a 100 percent chance of lowering interest rates next month.
In terms of data, investors are likely to monitor the latest weekly unemployment claims numbers and first quarter current account data. and the Philadelphia Fed production survey for June, which will be released at 8:30 am CET. The most important index numbers for May follow a little later in the session.