U.S. stock futures rose and bond yields declined Thursday after the Federal Reserve signaled it might be close to pausing interest-rate increases.
“There’s been a bit of calm restored. A big part of it is that the Fed has signaled that they’re almost done,” said Fahad Kamal, chief investment officer at Kleinwort Hambros.
Fed Chair Jerome Powell said Wednesday that officials had considered skipping a rate hike after banking stress intensified last week. He hinted that Wednesday’s increase could be their last one for now, depending on the extent of any lending pullback.
In recent market action:
- Index futures rose. S&P 500 futures added 0.3%, a day after the broad-market index lost 1.6%. Nasdaq-100 futures climbed 0.8%, suggesting gains for technology stocks after the opening bell.
- Stocks have whipsawed in recent days, as central banks have moved to contain instability in the banking sector while also fighting inflation. The S&P 500 has moved more than 1% in nine trading sessions in March so far.
- Bond yields fell. The 10-year Treasury yield extended its drop into a second day, falling to 3.477% from 3.497%.
- Market pricing shows investors expect the Fed to cut interest rates in the months ahead, weighing on bond yields.
- The Bank of England is set to report its latest interest-rate decision at 8 a.m. ET. Investors and analysts are widely expecting a 0.25 percentage-point increase after a hot inflation print earlier this week.
- In Asia, Hong Kong’s Hang Seng Index rose 2.3%, lifted by strong earnings from Tencent. The Chinese tech giant reported a turnaround in revenue growth, sending its shares up 8%.
In individual stock moves:
↘️ Coinbase (COIN): The crypto exchange said the Securities and Exchange Commission plans to sue it for violating investor-protection laws. Coinbase’s stock fell nearly 13% premarket.
↗️ First Republic Bank (FRC): The troubled lender’s stock rose about 2% premarket. It had plunged 15% Wednesday on Janet Yellen’s comments that not all bank deposits may be guaranteed by the Treasury Department.
↗️ JD.com (JD): American depositary receipts in JD.com and other Chinese internet companies such as Alibaba, Baidu and PDD rose premarket. This came after the Federal Reserve signaled it might end its rate-rise campaign sooner than recently seemed likely, and after strong results from Tencent.
↘️ Chewy (CHWY): The online pet-products retailer reported a surprise drop in active customers from a year ago. Its shares fell more than 6.2% premarket.
Write to Anna Hirtenstein at anna.hirtenstein@wsj.com
Source: wsj.com