Investing.com – U.S. stock futures fell on Thursday evening as concerns persist about a slower pace of interest rate cuts in 2025, while upcoming non-farm payrolls data should provide further signals for the economy.
Fourth quarter earnings season is also set to begin in earnest next week, with plenty of big banks looking forward to it.
Trading volumes were light due to Thursday’s market holiday honoring the death of former President Jimmy Carter.
Wall Street indexes had a volatile start to 2025 as hawkish signals from the Federal Reserve and uncertainty over President-elect Donald Trump’s policies weighed on risk appetite.
fell 0.3% to 5,942.50 and was down 0.3% at 21,287.75 by 6:11 pm ET (2311 GMT). fell 0.2% to 42,809.0 points.
Nonfarm payrolls await new rate numbers
The focus now turns to December, due on Friday, for more information on the labor market and interest rate movements.
The strengthening labor market is expected to give the Fed even more room to cut interest rates at a slower pace. Fears of a slowdown in the labor market were one of the main motivations for the Fed cutting rates by 1% in 2024.
But the central bank downgraded its forecast for rate cuts in 2025, citing concerns about persistent inflation. Minutes from the Fed’s December meeting released Wednesday also showed policymakers worried about the inflationary impact of Trump’s protectionist policies.
Treasury yields and the dollar rose after Wednesday’s minutes, further weighing on Wall Street.
Fourth quarter reporting season begins with the largest banks
Fourth-quarter earnings season begins in earnest next week, with several major banks participating, including JPMorgan Chase & Co (NYSE:), Wells Fargo and company (NYSE:), Goldman Sachs Group Inc (NYSE:) and Citigroup Inc (NYSE:) will release earnings on Wednesday.
Before that, Delta Air Lines Inc (NYSE:) and Walgreens Boots Alliance Inc (NASDAQ:) will report earnings on Friday.
The focus will be on whether the strength of the U.S. economy has translated into higher corporate earnings and whether the tech heavyweights that have been a key driver of Wall Street’s 2024 rally have been able to maintain their earnings growth.
Investors will also be watching for any signs of strong earnings spreading beyond the technology sector.