Traders work on the floor of the New York Stock Exchange during morning trading on December 13, 2023 in New York City.
Michael M. Santiago | Getty Images
U.S. stock futures rose on Wednesday evening after the Federal Reserve announced multiple interest rate cuts in 2024, and the Dow Jones Industrial Average closed at an all-time high.
Futures tied to the 30-stock Dow Jones rose 90 points, or 0.2%. S&P 500 futures and Nasdaq 100 futures gained 0.3% and 0.4%, respectively.
The Federal Open Market Committee left interest rates unchanged in a range between 5.25% and 5.5%, in line with Wall Street expectations. Market sentiment improved after policymakers planned three rate cuts next year.
In regular trading, the Dow rose 1.4% during the main session to close at 37,090.24. This was the first time the 30-stock index closed above 37,000, breaking its previous closing high set in January 2022. The S&P 500 gained 1.37% to close above 4,700 for the first time since January 2022. The Nasdaq Composite gained 1.38%. The three major averages all rose to new 52-week highs.
The central bank's comment is an “indication that we are on the path to a soft landing – and perhaps they can ease monetary policy more in 2024 than the market expects,” said Ross Mayfield, investment strategy analyst at Baird.
Mayfield believes the market rally over the last six weeks and the fallout from Powell's comments are now “justified.”
“Basically, we strive for perfection in our pricing,” Mayfield said. “We're probably at a point where the risks are trending a bit lower in 2024, but a soft landing is certainly in sight and the Fed's recognition today actually helps justify the move in stocks.”
In extended trading on Wednesday, shares of Adobe fell more than 4% after a subdued forecast for 2024 profit and revenue.
Investors will be keeping an eye on economic data on Thursday. Weekly jobless claims are released at 8:30 a.m. ET. Also expected this morning are November retail sales and import data, as well as October's business inventory report.