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U.S. equity futures moved firmly higher Wednesday, powered by outsized gains for the chip sector and a pullback in Treasury bond yields, as investors braced for a crucial Federal Reserve rate decision amid a dizzy day of headline risks for global financial markets.
Updated at 7:40 AM EDT
Boeing (BA) shares jumped higher after the planemaker posted a wider-than-expected second quarter loss that was offset by the naming of industry veteran Kelly Ortberg as its new CEO.
Ortberg, who recently ran Rockwell Collins, will replace outgoing boss Dave Calhoun on August 8 as the group looks to put its recent safety and production issues behind it following a one-year decline of more than 22% for the world’s second-largest aerospace group.
Boeing shares were last marked 2.22% higher in premarket trading at $191.02 each.
Source: Boeing media relations.
Stock Market Today:
Stronger-than-expected second quarter earning from chipmakers Advanced Micro Devices (AMD ) and Samsung, tied in part to surging AI investment demand, is driving gains for semiconductor space heading into today’s trading session and offsetting the impact of a mixed set of fourth quarter numbers from Microsoft (MSFT) .
Microsoft, the word’s second-largest company, topped Street forecasts for sales and profits, but noted that its capital spending would continue to rise. It also reported modestly slower revenue growth from its Azure cloud division, suggesting hyperscalers may need more time to monetize their AI investments.
Related: Microsoft shares look to move lower
The larger market focus of the session, however, is likely to fall on the Fed’s rate decision, expected at 2:00 pm Eastern time, as well as the regular press conference from Chairman Jerome Powell thirty minutes later.
Fed Chairman Jerome Powell will speak to the media today at 2:30 pm Eastern time.
Olivier Douliery/Bloomberg via Getty Images
No change is expected in the Fed Funds rate, which stands at a two-decade high of between 5.25% and 5.5%, but Powell is widely expected to signal at least one cut, and possibly more, starting in the early autumn.
Benchmark 10-year Treasury bond yields, which have fallen around 15 basis points since the Fed’s last meeting in June, were last trading at 4.134% while 2-year notes were marked at 4.367%.
Related: Fed to signal timing of first interest rate cut as inflation slows
Overnight in Asia, the Bank of Japan raised its own benchmark lending rate for only the second time in 17 years, while unveiling plans to trim its monthly bond purchases, as it slowly begins to normalize policy following a years-long fight against deflation.
The Bank of England will also unveil its own rate decision tomorrow in London, but traders aren’t betting on any changes to the benchmark Bank Rate following a series of stronger-than-expected GDP growth figures.
Heading into the start of the trading day on Wall Street, futures contracts tied to S&P 500, which remains in negative territory for the month, are priced for a 53 point gain to kick-off the session, with a 120 point boost for the Dow Jones Industrial Average.
The tech-focused Nasdaq, meanwhile, is called 280 points higher thanks in part to a 9% gain for AMD and a 5.6% lift for Nvidia (NVDA) .
Microsoft shares were marked 2.6% lower at $412.05 each while Meta Platforms (META) , which reports after the closing bell, edged 0.22% higher to $464.21 each.
Elsewhere, global oil prices jumped higher in overnight trading following news of the assassination of a senior Hamas leader, Ismail Haniyeh, who was killed during a visit to Iran.
Tehran has blamed the killing on Israel, which has yet to officially comment, while Supreme Leader Ayatollah Ali Khamenei has vowed “harsh punishment” in retaliation.
Brent crude futures contracts for September delivery, the global pricing benchmark, were last seen $1.72 higher on the session at $80.36 per barrel, while WTI contracts for the same month, which are tied to U.S. gas prices, rose $1.94 to $76.67 per barrel.
More Wall Street Analysts:
Analyst revisits Nvidia stock price target after Blackwell checksAnalysts prescribe new Walgreens stock price targets after earningsAnalyst revises Facebook parent stock price target in AI arms race
In overseas markets, Europe’s Stoxx 600 rose 0.95% in Frankfurt, while the FTSE 100 gained 1.41% in London.
Overnight in Asia, the Nikkei 225 ended 1.49% higher following the Bank of Japan rate increase, while the regional MSCI ex-Japan benchmark rose 1.2% into the close of trading.
Related: Veteran fund manager sees world of pain coming for stocks
