Investing.com — U.S. stock index futures were little changed in evening trading on Wednesday as trading volume remained thin due to the Independence Day holiday.
But Wall Street hit a record high in shortened trading on Wednesday as the weak data stoked hopes that the Federal Reserve will start cutting interest rates from September.
It stabilized at 5,590.50 points and was flat at 39,646.0 points as of 19:09 ET (23:09 GMT).
Nasdaq, S&P 500 hit record highs on rate cut hopes
A series of weak labor market indicators has led traders to strengthen their view that the Fed will cut interest rates by 25 basis points in September.
The June data was weaker than expected but posted a stronger-than-expected weekly gain, raising hopes that Friday’s data will signal a slight cooling in employment, a key consideration for the Fed as it cuts interest rates.
In line with this thinking, the rose 0.5% to 5,537.02 points, and the rose 0.9% to 18,188.30 points. The lagged behind, declining 0.1% to 39,308.0 points.
Investors remain biased towards large growth stocks, mostly technology, with hype around artificial intelligence also impacting sentiment.
Traders now see about a 66% chance of a 25 basis point cut in September, up from 59.5% the previous day.
But other signals, particularly from the Fed, have sparked little optimism for a rate cut.
Federal Reserve meeting minutes show officials unsure about cutting rates
The report released Wednesday indicated that while officials acknowledge the U.S. economy is cooling, they are still unsure whether the central bank should start cutting interest rates.
High inflation figures in recent months have led several policymakers to call for further rate hikes, citing concerns that monetary policy is not tight enough.
The minutes were released a day after Fed Chairman Jerome Powell signaled some progress toward tame inflation but warned the central bank needed more credibility before starting to cut interest rates.
Several other Fed officials have echoed that sentiment in recent weeks.
