U.S. stock futures fell on Tuesday as investors focused on the Federal Reserve’s final meeting of 2024.
11 days in a row with more decliners than advancers on the S&P 500, ties longest streak since 1990.
Many claim this is bearish, but is it?
Looking at the longest streaks ever actually appears to be rather bullish. Significant outperformance across the board out one year.
🤔 pic.twitter.com/mgDJ0wVlYY
— Ryan Detrick, CMT (@RyanDetrick) December 17, 2024
The Dow Jones Industrial Average is on track for its ninth straight day of losses, its longest losing streak since 2018. Futures tied to the Dow dropped 218 points or 0.4%.
S&P 500 futures edged 0.3% lower, while Nasdaq-100 futures ticked down 0.2%. The Fed’s December meeting kicks off today and concludes tomorrow. The central bank is widely expected to cut interest rates by a quarter of a percentage point.
Dow down 7 days in a row, but only 2.6% off the all-time highs (third least ever).
I see 78 7-day losing streaks since 1900 and an avg of 24.7% off ATHs.
— Ryan Detrick, CMT (@RyanDetrick) December 15, 2024
Market participants will closely watch Chair Jerome Powell’s comments for signals on the future path of borrowing costs.
6m forecast for capex still up from low but eased a touch in December relative to November per Empire Manufacturing Index pic.twitter.com/2t8MY1oO9t
— Liz Ann Sonders (@LizAnnSonders) December 17, 2024
Mark Hackett, chief of investment research at Nationwide, said a quarter-point cut is “the overwhelmingly likely outcome” from Wednesday’s policy decision. However, he noted that “the consensus is that the Fed will take a more gradual approach from there, embedding just two additional cuts through 2025.” Hackett added that Powell is currently “walking the knife’s edge” by slashing borrowing costs when the U.S. economy still appears strong and inflation remains above the Fed’s 2% target.
Oil prices slipped after weak Chinese economic data released Monday renewed concerns about global crude demand.
Broadcom meets earnings expectations
Brent crude was down 0.3% at $73.66 a barrel, while West Texas Intermediate fell 0.5% to $70.34 a barrel.
Bond yields rose slightly over the past 24 hours. The yield on the benchmark 10-year U.S. Treasury note was 4.442%, and 2-year notes were yielding 4.276%. In other market movements, XRP’s price increased after Ripple launched a new stablecoin token.
Gold eased ahead of the Fed meeting. Investors are also paying attention to the Bank of England’s meeting on Thursday. The U.K.’s FTSE 100 index was down 0.8% after wage growth data exceeded expectations, tempering bets on future rate cuts by the Bank of England.
According to Adam Crisafulli of Vital Knowledge, excitement around Donald Trump’s re-election is waning. Investors are increasingly worried about factors like higher deficits and tariffs, which offset positives such as deregulation and tax relief. Additionally, a potential shift in Federal Reserve policy is contributing to a more cautious market narrative.
The Fed is expected to significantly slow the pace of rate cuts in 2025.
