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U.S. Stock Futures Edge Higher as Rate Cut Bets Grow Amid Weak Jobs Data

U.S. Stock Futures Edge Higher as Rate Cut Bets Grow Amid Weak Jobs Data. Source: Luca Marfè at Italia all'ONU, CC BY 2.0, via Wikimedia Commons

U.S. stock index futures ticked higher Sunday evening as traders weighed expectations for lower Federal Reserve interest rates against mounting concerns over a slowing labor market and broader economy.

S&P 500 Futures gained 0.2% to 6,503.0, Nasdaq 100 Futures rose 0.4% to 23,771.25, and Dow Jones Futures advanced 0.2% to 45,547.0 by 19:25 ET (23:25 GMT). The uptick followed Friday’s dip on Wall Street after August nonfarm payrolls came in weaker than expected, highlighting a sharp slowdown in job creation. The report also showed unemployment rising, fueling fears of an economic recession.

Despite the disappointing jobs data, markets found support in growing bets that the Fed will cut interest rates in September. According to CME FedWatch, futures pricing showed a 91.7% probability of a 25-basis-point cut at the September 16–17 meeting, with an 8.3% chance of a deeper 50-bps reduction. The Fed has previously indicated that persistent labor market weakness could pave the way for additional easing this year.

Traders are now awaiting key U.S. inflation data for further direction. The August Consumer Price Index, due Thursday, is expected to reflect the impact of President Donald Trump’s tariffs, many of which took effect last month. Economists warn that importers absorbing these costs could drive consumer prices higher. Producer Price Index data is also set for release this week.

While inflation figures are unlikely to sway the Fed’s upcoming September decision, they may influence its policy outlook for the remainder of the year. Officials have consistently cautioned that tariff-related inflationary pressures could complicate or delay further rate cuts, even as recession risks rise.

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