US stock futures showed a modest increase on Wednesday as investors anticipated the release of the latest Federal Reserve minutes, which may provide crucial insights into the current economic landscape amid a government shutdown that has stalled key economic data. Futures for the Dow Jones Industrial Average, the S&P 500, and the tech-heavy Nasdaq 100 all rose about 0.2%.
The minutes from the Fed’s September meeting, set to be released later in the day, could shed light on internal divisions within the central bank and the future trajectory of interest rates, particularly as the ongoing shutdown hampers access to essential economic indicators. The Bureau of Labor Statistics had to delay the release of the September jobs report, which is typically an important metric for investors focused on the Fed’s policy decisions, especially given the labor market’s significant role in shaping these decisions.
On Tuesday, markets closed lower across the board, driven down by disappointing reports surrounding Oracle’s cloud margins, which raised concerns regarding the effectiveness of artificial intelligence investments. This downturn ended a seven-day winning streak for both the S&P 500 and the Nasdaq.
Meanwhile, gold futures continued to climb, crossing the $4,000 per ounce threshold for the first time earlier this week, marking a 100% rise in value over the last two years. These gains are attributed to increasing anxiety over the economic environment, further exacerbated by the federal government shutdown, which has now lasted seven days. As the deadlock in Washington persists, President Trump has publicly aligned with Republican leaders, stating there will be no negotiations with Democrats regarding healthcare subsidies until the government reopens. He has also threatened to withhold back pay for furloughed federal employees.
In premarket trading, several stocks attracted attention. FedEx shares declined by 2% following an SEC filing indicating that Prime Capital Investment Advisors reduced its stake in the company by selling 4,610 shares. Conversely, QuantumScape saw a 7% rise in its stock, buoyed by a promising partnership with PowerCo SE and its recent showcase of solid-state batteries at the IAA Mobility conference. Additionally, QuantumScape announced a collaboration with Corning to advance ceramic separator manufacturing.
Nano Nuclear Energy Inc. faced an 8% decline in premarket trading after it revealed it had reached securities purchase agreements with institutional investors, involving the sale of approximately 8.5 million shares of common stock.
In a broader market discussion, Goldman Sachs strategist Peter Oppenheimer weighed in on the state of the stock market, stating that it is not in a bubble at this time, a conclusion that caught the attention of many investors.
In corporate news, SoftBank has agreed to acquire ABB’s robotics business for $5.4 billion, a move aimed at enhancing its focus on integrating hardware with artificial intelligence. The deal further underscores the shifting landscape in tech investment strategies.
Amid ongoing discussions around interest rates, Fed officials appear to be divided on the direction of future cuts. Some are concerned about inflation, while others are focused on labor market stability. This discord was exemplified by recent speeches from newly appointed Fed governor Stephen Miran and Kansas City Fed president Jeff Schmid.
Intel’s stock, which has surged 90% over the past six months, received scrutiny from HSBC analyst Frank Lee, who downgraded the chipmaker’s rating, suggesting that the stock’s current valuation may be too high. This shift in perspective could have implications for investors closely monitoring the company’s performance against major industry players like Nvidia.
Nvidia, for its part, has committed to investing in Elon Musk’s artificial intelligence venture, xAI. The financing plan has increased to $20 billion, with Nvidia pledging up to $2 billion in equity as part of the arrangement, further fueling interest in AI developments.
Meanwhile, Confluent, a data streaming software firm, saw its shares rise by 18% in premarket trading as it announced it is exploring a potential sale following increased acquisition interest.
As the situation unfolds, the markets remain on edge, navigating through uncertain economic waters while seeking clarity from the Federal Reserve’s forthcoming minutes and developments in corporate earnings.
