U.S. stock index futures edged lower on Tuesday evening as caution grew before the Federal Reserve’s final interest rate decision for the year. Markets have fully priced in a 25 basis point cut at the end of the year, with the focus on long-term rate outlook signals. The Fed is expected to adopt a slower rate cut path after lowering rates in December.
The S&P 500 inched 0.1% lower to 6,119.0 points, while the Dow Jones Industrial Average fell 0.3% to 22,252.25 points by 18:40 ET (23:38 GMT). The Nasdaq 100 were largely steady at 43,964.0 points, after recording its longest losing streak since 1978 on Tuesday.
Market focus will be squarely on the Fed’s economic projections for the next year, and comments from Chair Jerome Powell, which could help investors gauge the Fed’s long-term rate outlook. Investors expect the Fed to indicate a slower pace of rate cuts in 2025, as persistent inflation and a strong labor market continue to pose concerns.
Earlier in the day, data showed that retail sales rose by 0.7% in November, above the 0.5% forecast. Stronger-than-expected retail sales data signals that the economy remains strong and consumer spending remains robust, despite challenges like inflation and high interest rates. This strength was driven by a solid labor market and steady household finances.
The tech sector gave away some of its recent gains on Tuesday, with NVIDIA Corporation dropping 1.2% and Alphabet falling 0.5%. The S&P 500 fell 0.4% to 6050.61 points, while the Dow Jones Industrial Average lost 0.3% to 20,108.30 points. The Nasdaq 100 closed 0.6% lower at 43,449.90 points, marking its ninth consecutive daily decline, the longest losing streak since February 1978.
