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Futures Continue To Rise As Firm Rate Drop Bets Fuel Substantial Gains

Oct. 10: First plane with 'advanced' US ammo lands at airbase; Blinken to visit Israel. (PHOTO: The Times of Israel)

On the last day of a volatile 2023, U.S. stock index futures slightly increased in modest trade. The benchmark S&P 500 and the Dow were both hovering near record highs due to mounting anticipation that the Federal Reserve may lower interest rates early in 2024.

Double Digit Returns

On Thursday, the Dow reached its highest point ever, while the tech-heavy Nasdaq and S&P 500 also edged closer to their one-year highs. The benchmark S&P was very close to reaching its intraday high on January 4, 2022.

The three primary indices also targeted monthly and quarterly gains, as well as their ninth consecutive week of gains. They were expected to see double-digit returns in 2023, as the Nasdaq recovered dramatically from last year’s decline to make a record annual advance since 2003.

Investors are increasing their bets on rate reduction through 2024 as a result of the Fed’s aggressive rate hikes, which are cooling the U.S. labor market and exerting pressure on the economy.

The likelihood that policymakers would reduce the Fed funds target rate by 25 basis points in March was 70.1%, according to CME’s FedWatch tool.

Among other things, the year 2023 was characterized by the Israel-Hamas conflict, the aggressive Fed rate hikes that were ultimately stopped in September, the U.S. banking crisis in March, a surge in artificial intelligence equities, and economic worries that ultimately strengthened the argument for policy easing bets.

Top Sectoral Gainer

Thanks to a boom in megacap companies and an excitement surrounding AI, the information technology sector is expected to rise 56.8% in 2023, making it the top sectoral gainer. The defensive utilities sector saw a decrease of 10.1%.

Fuel

Source- The US Sun

With increases of over three times, Nvidia and Meta Platforms were the biggest annual gainers on the S&P 500. Due to New Year’s Day, markets will be closed on Monday, January 1, as investors wind down for the holiday season.

Nasdaq 100 e-minis were up 21.75 points, or 0.13%, Dow e-minis were up 17 points, or 0.04%, and S&P 500 e-minis were up 2.75 points, or 0.06%, at 5:39 a.m. ET.

Uber Technologies and Lyft, two corporate movers, saw premarket losses of 1.3% and 4.8%, respectively, following a report by Nomura downgrading the ride-sharing platforms.

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