US Futures Surge Towards Eighth Consecutive Gain as Yields Fall and Fed Rate Cut Anticipated

As the trading day progresses, US equity futures continue to climb, pushing the Dow toward its eighth consecutive session gain. This optimistic trend is attributed to declining Treasury yields in light of expectations for an autumn Fed rate cut. Stocks closed higher on Thursday as well, with the S&P 500 now just under 1% away from its March record high after the Labor Department reported a surge in weekly jobless claims, signaling possible relief from inflation pressures. A series of treasury auctions this week, including benchmark sales of 10-year notes and 30-year bonds, have drawn solid demand from foreign investors, easing concerns regarding the government’s increasing deficit. The FedWatch tool now forecasts a 68.5% chance of a September Fed rate cut, while San Francisco Fed President Mary Daly warned against hasty rate changes until clearer evidence emerges regarding overall inflation trends. With the majority of Q1 earnings reports behind them, investors are now waiting for upcoming inflation figures scheduled for release on May 15, including the crucial CPI reading. Major indices such as the S&P 500 and Nasdaq are poised for notable gains at market open, with the former projected to increase by 22 points and the latter anticipated to rise by 95 points. In Europe, the FTSE 100 ascended to a fresh all-time high, following yesterday’s Bank of England rate decision and strong Q1 GDP results. The MSCI ex-Japan index similarly posted significant gains in German trading hours. Japanese equities also experienced growth, with the Nikkei 225 ending the day 0.41% higher.