U.S. stock futures pointed to further gains Thursday, extending the rise that was seen after the Federal Reserve interest-rate decisions.
What’s happening
- Futures on the Dow Jones Industrial Average YM00, +0.49% rose 170 points, or 0.5%, to 35986
- Futures on the S&P 500 ES00, +0.55% added 0.6%, or 26 points, to 4726
- Futures on the Nasdaq 100 NQ00, +0.61% gained 0.6%, or 104 points, to 16391
On Wednesday, the Dow Jones Industrial Average DJIA, +1.08% rose 383 points, or 1.08%, to 35927, the S&P 500 SPX, +1.63% increased 76 points, or 1.63%, to 4710, and the Nasdaq Composite COMP, +2.15% gained 328 points, or 2.15%, to 15566.
What’s driving markets
Analysts said the Fed was, if anything, hawkish in its forecasts for interest-rate hikes in 2022 and 2023 as it increased the pace of the bond purchase taper.
“Based on asset price moves during the meeting and after, fear ahead of the FOMC meeting was probably even more exaggerated than we thought,” said Steve Englander, head of global G10 currency research and North America macro strategy at Standard Chartered.
“The initial market reaction does not always stick, but we suspect that both the Fed and investors are satisfied that the Fed is aware of and responding to inflation risks, while taking a measured, data-dependent approach in responding,” said Englander.
Mike Kramer of Mott Capital Management attributed the rise to the decline in volatility. “The rally in stocks was purely driven by the move lower in the VIX VIX, -3.27%, as implied volatility levels drop. We see this often these day,” he said.
There’s other central bank decisions that are due on Thursday, including from the Bank of England and European Central Bank. There’s also a raft of U.S. economic data, including jobless claims and housing starts.
Lennar LEN, +1.75% late Wednesday reported a surge in profit that missed analyst expectations, in news that could put a recent homebuilder rally at risk.
