Stock Index Futures Gain With All Eyes on Fed Rate Decision

March S&P 500 E-Mini futures (ESH25) are up +0.21%, and March Nasdaq 100 E-Mini futures (NQH25) are up +0.22% this morning, pointing to a slightly higher open on Wall Street as investors await the Federal Reserve’s policy decision and Chair Jerome Powell’s comments.

In yesterday’s trading session, Wall Street’s three main equity benchmarks closed lower. The Magnificent Seven stocks sank, with Tesla (TSLA) sliding over -5% and Meta Platforms (META) falling more than -3%. Also, travel stocks retreated on economic concerns, with Royal Caribbean Cruises (RCL) slumping over -7% and Norwegian Cruise Line Holdings (NCLH) dropping more than -4%. In addition, Bakkt Holdings (BKKT) plummeted over -27% after Bank of America and Webull Pay announced they would not renew their commercial agreements with the company. On the bullish side, Harrow Health (HROW) surged more than +15% after the company reported better-than-expected preliminary Q4 revenue.

Economic data released on Tuesday showed that U.S. housing starts rose +11.2% m/m to 1.501M in February, stronger than expectations of 1.380M. Also, U.S. February building permits, a proxy for future construction, fell -1.2% m/m to 1.456M, stronger than expectations of 1.450M. In addition, U.S. industrial production advanced +0.7% m/m in February, stronger than expectations of +0.2% m/m, while manufacturing production gained +0.9% m/m, stronger than expectations of +0.3% m/m. At the same time, the U.S. February import price index unexpectedly rose +0.4% m/m, stronger than expectations of -0.1% m/m.

Today, all eyes are focused on the Federal Reserve’s monetary policy decision later in the day. The Federal Open Market Committee is widely expected to hold the Fed funds rate steady at 4.25% to 4.50%. Market watchers will closely follow Chair Jerome Powell’s post-policy meeting press conference and the central bank’s quarterly “dot plot” in its Summary of Economic Projections for clues on the path ahead. For now, Fed officials have indicated they are in a wait-and-see mode as they look for further progress on inflation and more clarity on the economic impact of President Trump’s policies. 

“The ongoing trade tensions and tariff implementations under President Trump’s administration have introduced significant uncertainty,” said Jay Woods at Freedom Capital Markets. “Investors are eager to understand how these policies are influencing the Fed’s economic outlook, especially concerning inflation and growth projections.”

A survey conducted by 22V Research showed that investors are monitoring the March Fed meeting more closely than the previous three meetings. “Our survey respondents lean risk-off vs risk-on (34% vs 27%, respectively). We also asked what people think the other respondents expect, and more investors expect a risk-on reaction than people thought,” said Dennis DeBusschere, founder of 22V.

On the economic data front, investors will focus on U.S. Crude Oil Inventories data, which is set to be released in a couple of hours. Economists expect this figure to be 0.800M, compared to last week’s value of 1.448M.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.291%, up +0.23%.

The Euro Stoxx 50 Index is up +0.09% this morning as investors digested inflation data from the region and turned their attention to the Fed’s interest rate decision. Defense stocks extended gains after Germany approved a substantial spending surge on Tuesday. At the same time, mining and bank stocks underperformed. Final data from Eurostat released on Wednesday showed that the Eurozone’s annual headline inflation eased more than initially estimated in February, alleviating concerns that strong price pressures could hinder further ECB rate cuts. Meanwhile, investors monitored geopolitical developments in Ukraine as Russian President Vladimir Putin agreed to a limited ceasefire to halt attacks on Ukraine’s energy infrastructure but has not yet agreed to a full 30-day ceasefire. Investor focus is now on the Fed’s policy verdict later in the day. In corporate news, Traton Se (8TRA.S.DX) slid over -4% after parent company Volkswagen announced it had sold a 2.2% stake in the truckmaker.

Eurozone’s CPI and Eurozone’s Core CPI data were released today.

Eurozone February CPI has been reported at +0.4% m/m and +2.3% y/y, better than expectations of +0.5% m/m and +2.4% y/y.

Eurozone February Core CPI came in at +0.5% m/m and +2.6% y/y, compared to expectations of +0.6% m/m and +2.6% y/y.

Asian stock markets today settled in the red. China’s Shanghai Composite Index (SHCOMP) closed down -0.10%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -0.25%. 

China’s Shanghai Composite Index closed slightly lower today as some investors locked in gains following a recent strong rally. Telecommunications and hardware stocks weighed on the index on Wednesday. AI-related stocks also lost ground. Meanwhile, Chinese banks are cutting consumer loan rates to record lows, offering annual interest rates as low as 2.58%, as policymakers intensify stimulus efforts to support growth and offset U.S. President Donald Trump’s tariffs. That contrasts with rates that were as high as 10% roughly two years ago. In other news, U.S. Commerce Secretary Howard Lutnick said Tuesday that the Trump administration is seeking cooperation from companies and foreign governments to prevent China from acquiring U.S. chips. Investors are now awaiting China’s decision on its benchmark lending rates on Thursday, which are expected to remain unchanged as signs of improving economic recovery and shrinking profit margins at lenders have reduced the urgency for further easing. In corporate news, Xpeng Inc. slumped over -5% in Hong Kong after the company provided volume guidance that missed some analysts’ expectations. At the same time, CATL rose more than +3% after announcing a partnership with NIO on a battery-swapping network.

Japan’s Nikkei 225 Stock Index gave up earlier gains and closed lower today. The benchmark index was in the green for most of the day, including immediately after the Bank of Japan's rate decision, but flattened in the afternoon before a sharp drop at the close. Losses in chip stocks offset gains in heavy-industry and trading-house stocks on Wednesday. Ministry of Finance data released on Wednesday showed that Japan’s exports grew at a quicker pace in February as businesses ramped up orders ahead of the rollout of higher U.S. tariffs. Separately, data showed that Japan’s monthly core machinery orders, excluding those for ships and electric power companies, fell much more than expected in January. In addition, the monthly Reuters Tankan survey showed that sentiment among Japanese manufacturers turned negative in March, driven by worries over U.S. tariff policies and economic weakness in China. Meanwhile, the Bank of Japan left short-term interest rates unchanged at 0.5% in a widely expected move and stated that a virtuous cycle of wages and prices is intensifying, while it continues to monitor the global trade situation. The BOJ’s statement provided little fresh insights, as the central bank reiterated its expectation that underlying inflation is progressing toward its target of stable 2% growth. BOJ Governor Kazuo Ueda said at a press conference that the trend in consumer prices remains on an upward trajectory but has yet to reach the central bank’s 2% target. In corporate news, Toei Co Ltd gained nearly +2% after boosting its year-end dividend forecast to 12 yen per share, including a 6-yen special dividend, bringing the total annual payout to 18 yen. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed down -1.14% to 22.58.

The Japanese February Trade Balance has been reported at 584.5B yen, weaker than expectations of 722.8B yen.

The Japanese February Exports came in at +11.4% y/y, weaker than expectations of +12.1% y/y.

The Japanese February Imports arrived at -0.7% y/y, weaker than expectations of +0.1% y/y.

The Japanese January Core Machinery Orders stood at -3.5% m/m and +4.4% y/y, weaker than expectations of -0.1% m/m and +6.9% y/y.

The Japanese January Industrial Production came in at -1.1% m/m, in line with expectations.

Pre-Market U.S. Stock Movers

Tesla (TSLA) gained nearly +3% in pre-market trading after the company received California’s approval to begin carrying passengers. Also, Cantor Fitzgerald upgraded the stock to Overweight from Neutral with an unchanged price target of $425.

Gilead Sciences (GILD) slid more than -2% in pre-market trading after the Wall Street Journal reported that the Health and Human Services Department was weighing plans to significantly reduce the federal government’s funding for domestic HIV prevention.

StoneCo (STNE) climbed over +9% in pre-market trading after the company posted better-than-expected Q4 results.  

Healthequity (HQY) plunged more than -14% in pre-market trading after reporting weaker-than-expected Q4 adjusted EPS and issuing soft full-year guidance. 

Spire Global (SPIR) rose over +7% in pre-market trading after announcing the launch of two advanced AI weather models developed using NVIDIA Omniverse Blueprint for Earth-2.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Wednesday - March 19th

General Mills (GIS), Ollie’s Bargain Outlet (OLLI), Sportradar (SRAD), Kingsoft Cloud (KC), Five Below (FIVE), Corporacion America Airports (CAAP), Signet Jewelers (SIG), TWFG (TWFG), Worthington Steel (WS), Liquidia Technologies (LQDA), Capricor Therapeutics (CAPR), North American Construction (NOA), FrontView REIT (FVR), J.Jill (JILL), Gold Royalty (GROY), Mediwound (MDWD), SWK Holdings (SWKH), Epsilon Energy (EPSN), Scpharmaceuticals (SCPH), Sera Prognostics (SERA), Lument Finance Trust (LFT).