U.S. stock index futures rose in overnight trading on Sunday as focus shifted to the Federal Reserve’s upcoming meeting for further signals on interest rate cuts.
Also in focus was a string of second-quarter earnings from Wall Street heavyweights such as Apple Inc and Microsoft Corp, which are due in the coming days.
Wall Street indexes rose sharply on Friday after data on the personal consumption price index – the Federal Reserve’s preferred inflation gauge – came in within expectations in June, boosting optimism that the central bank will start cutting interest rates in September.
The S&P 500 rose 0.2% to 5,512.0 points, while it was up 0.4% at 19,244.50 points by 19:40 ET (00:40 GMT). The S&P 500 rose 0.2% to 40,931.0 points.
Fed meeting set to provide more clarity on rate cuts
The US Federal Reserve is widely expected to announce the decision at the end of its two-day meeting on Wednesday.
But any signals from the central bank on when it plans to start cutting interest rates will be closely watched, amid growing signs of slowing inflation in recent months.
Several Fed officials have said in recent speeches that the central bank is gaining more confidence in its fight against inflation and that it does not need to see inflation reach its 2% annual target to start cutting interest rates.
The general consensus is that the Fed will keep rates steady this week, but is likely to signal a rate cut in September. Traders have been seen pricing in a 25 basis point rate cut by the Fed in September.
Apple and Microsoft prepare to announce their earnings
Some of Wall Street’s biggest companies are scheduled to report earnings this week, with Microsoft and Apple set to report on Tuesday and Thursday, respectively.
Other major tech companies including Meta Platforms Inc (NASDAQ:), Advanced Micro Devices Inc (NASDAQ:), and Amazon.com Inc (NASDAQ:) are also scheduled to report earnings during the week.
The results come on the heels of a prolonged slide in technology stocks, with the sector hit hard by profit-taking and expectations of lower interest rates prompting investors to shift to more economically sensitive sectors.
Disappointing earnings from Alphabet Inc (NASDAQ:) last week have raised caution ahead of tech earnings, as investors wait to see if increased investment in artificial intelligence is paying off.
The index rose 1.1% to 5,459.10 points, while it rose 1% to 17,357.88 points on Friday. The index rose 1.6% to 40,589.34 points.