By Mike Murphy
Federal Reserve Chair Jerome Powell talks with reporters after the Fed held rates steady at its meeting on July 30.
U.S. stock-market futures were little changed Sunday, as investors await what is expected to be the Fed’s first interest-rate cut in nine months later this week.
Dow Jones Industrial Average futures (YM00), S&P 500 futures (ES00) and Nasdaq-100 futures (NQ00) were about flat late Sunday. Gold futures (GC00) slipped and crude oil (CL.1) rose, while bitcoin (BTCUSD) briefly rose above the $16,000 level before retreating. The ICE U.S. Dollar Index DXY, which tracks the buck against a basket of rivals, edged higher.
The Federal Reserve’s rate-setting committee meets Tuesday and Wednesday, with Chair Jerome Powell giving a speech after it ends Wednesday afternoon. Despite some division among Fed officials, he’s expected to announce a long-awaited rate cut of 25 basis points, which is hoped to thread the economic needle amid rising inflation and a weakening labor market.
Read more: A divided Fed is expected to settle on a 25-basis-point rate cut this week. The key question is, what comes next?
“The Fed can’t be caught behind the curve,” Stephen Innes, managing partner at SPI Asset Management, wrote in a weekend note. “Trimming rates now is less about stoking growth and more about stabilizing lift before stall speed turns into a nosedive.”
Beyond the expected cut, much attention will be paid to Powell’s reasoning, and hints at how the Fed will proceed in the coming months, with some experts predicting further rate cuts in October and December.
While rate cuts typically are good for the stock market, there are worries now of the rising risk of stagflation, and that the market may be too far ahead of the Fed’s view on cuts, which could trigger volatility in stocks.
See: Why the Fed’s first rate cut in 9 months could derail the stock-market rally – and how investors can prepare
Meanwhile, the market’s rally has rolled on through the summer, despite concerns that stocks are in “extreme overbought” territory and moving toward a “melt-up.”
On Friday, the Down Jones Industrial Average DJIA and S&P 500 SPX finished lower while the Nasdaq Composite COMP rose 0.4% to close at a new high. On the week, the Dow gained 1%, the S&P 500 rose 1.6% and the Nasdaq jumped 2%.
-Mike Murphy
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09-14-25 2101ET
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