S&P Futures Tick Higher Ahead of FOMC Meeting Minutes

December S&P 500 E-Mini futures (ESZ25) are trending up +0.15% this morning, signaling a partial rebound from yesterday’s losses, while investors await the Federal Reserve’s September meeting minutes and remarks from central bank officials.

In yesterday’s trading session, Wall Street’s three main equity benchmarks closed in the red. Chip stocks retreated, with Lam Research (LRCX) and Applied Materials (AMAT) sliding more than -5%. Also, homebuilder stocks slumped after Evercore ISI downgraded the sector to In-Line from Outperform, with D.R. Horton (DHI) falling more than -6% and PulteGroup (PHM) dropping over -4%. In addition, Aehr Test Systems (AEHR) plunged more than -17% after the maker of semiconductor equipment swung to a quarterly loss on a GAAP basis and declined to reinstate its formal guidance. On the bullish side, Applovin (APP) climbed over +7% and was the top percentage gainer on the S&P 500 and Nasdaq 100 after Citigroup advised buying the stock following a sell-off triggered by a report of an SEC probe into the company’s data-collection practices.

“A period of consolidation would not come as a surprise after such a strong recent run, but we believe the equity rally is underpinned by solid fundamentals that should continue to support the market,” said Ulrike Hoffmann-Burchardi at UBS Global Wealth Management.

Economic data released on Tuesday showed that U.S. consumer credit rose by just $0.36 billion in August, weaker than expectations of $12.90 billion.

Fed Governor Stephen Miran reiterated on Tuesday that his view of tariffs having only a limited impact on inflation supports the case for the Fed to continue easing policy. At the same time, Minneapolis Fed President Neel Kashkari warned that sharp interest rate cuts would risk fueling inflation. He also noted that “some of the data that we’re looking at is sending some stagflationary signals.”

U.S. rate futures have priced in a 94.6% chance of a 25 basis point rate cut and a 5.4% chance of no rate change at the October FOMC meeting.

The World Trade Organization on Tuesday slashed its 2026 forecast for global merchandise trade volume growth to 0.5% from 1.8%, citing the anticipated lagged effects of U.S. President Donald Trump’s tariffs. “The outlook for next year is bleaker...I am very concerned,” Director-General Ngozi Okonjo-Iweala told reporters in Geneva.

Meanwhile, the U.S. government shutdown has entered its eighth day, with no resolution in sight. JPMorgan CEO Jamie Dimon said on Tuesday that while the shutdown is a poor way to manage the federal government, it is unlikely to hurt the stock market in the long term.

Today, market watchers will pay close attention to the publication of the Fed’s minutes from the September 16-17 meeting for insights into policymakers’ appetite for another rate cut. The FOMC cut interest rates last month for the first time this year, though subsequent public comments from various officials suggest there is division over how urgently further action should be taken.

“Any insights on the future policy rate path and views [on] the double-sided risks to employment and inflation will be closely watched by market participants,” HSBC economists said in a note.

Also, market participants will hear perspectives from St. Louis Fed President Alberto Musalem, Fed Governor Michael Barr, Chicago Fed President Austan Goolsbee, Dallas Fed President Lorie Logan, and Minneapolis Fed President Neel Kashkari throughout the day.

On the economic data front, investors will focus on U.S. Crude Oil Inventories data, set to be released in a couple of hours. Economists expect this figure to be 0.4 million, compared to last week’s value of 1.8 million.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.117%, down -0.34%.

The Euro Stoxx 50 Index is up +0.36% this morning, resuming the recent rally. Mining stocks led the gains on Wednesday as gold surged above $4,000 for the first time. Bank stocks also advanced. In addition, steel stocks gained ground after the European Commission proposed cutting tariff-free steel import quotas by nearly half as part of efforts to safeguard the European Union’s steel industry. The benchmark index was also buoyed by efforts to resolve France’s budget deadlock. Limiting gains, automobile stocks tumbled, with Bayerische Motoren Werke AG (BMW.D.DX) slumping over -7% after the German luxury automaker cut its full-year earnings guidance, citing weak sales in China and higher costs linked to tariffs. Technology stocks also retreated, with ASML and ASMI leading declines after U.S. lawmakers urged broader restrictions on chipmaking equipment sales to China. Meanwhile, Bloomberg reported on Wednesday that earlier this month, U.S. President Donald Trump’s administration sent the EU a proposal outlining new U.S. demands for concessions and other measures to implement “reciprocal, fair, and balanced” trade, which EU officials see as maximalist and potentially undermining the recently reached trade deal. On the economic front, data released on Wednesday showed that Germany’s monthly industrial production fell far more than expected in August, reflecting the uncertainty caused by rising U.S. tariffs on the sector.

European Central Bank Governing Council member Jose Luis Escriva said on Wednesday that interest rates in Europe are currently at an “appropriate level,” with no need for additional guidance. 

Germany’s Industrial Production data was released today.

The German August Industrial Production fell -4.3% m/m, weaker than expectations of -1.0% m/m.

Japan’s Nikkei 225 Stock Index (NIK) closed down -0.45%, while mainland China’s financial markets were closed for a holiday.

Japan’s Nikkei 225 Stock Index closed lower today, snapping a 4-session winning streak as investors took profits following the recent rally. Electronics and automobile stocks retreated on Wednesday. Nomura Securities strategist Maki Sawada said, “Given this rapid pace of ascent, we believe conditions are ripe for profit-taking.” Government data released on Wednesday showed that Japanese workers’ real wages declined for the eighth consecutive month in August, underscoring a key challenge for newly elected ruling party leader Sanae Takaichi, who has vowed to tackle rising living costs. Real wages, a key gauge of Japanese households’ purchasing power, dropped 1.4% in August from a year earlier, according to data from the Ministry of Health, Labour and Welfare. Meanwhile, the yen weakened to its lowest level against the dollar since February as prospects for an early Bank of Japan rate hike diminished following Takaichi’s election as leader of the ruling party. She is expected to be voted in as prime minister next week and has signaled support for a more cautious stance from the central bank. Still, former BOJ executive Kazuo Momma said on Wednesday that the yen’s recent sharp decline could push the central bank to raise interest rates as early as this month. In other news, Pictet Asset Management boosted its holdings of Japanese equities after Takaichi’s victory, with exposure in its Dynamic Allocation fund rising to 10% from 6%. In corporate news, SoftBank Group fell -2% after agreeing to buy ABB’s robotic business in a $5.38 billion deal, including debt. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed up +6.75% to 28.78.

The Japanese August Current Account n.s.a. stood at 3.776T yen, stronger than expectations of 3.540T yen.

The Japanese September Economy Watchers Current Index came in at 47.1, stronger than expectations of 47.0.

China’s Shanghai Composite Index was closed today for the Mid-Autumn Festival holiday. Mainland China’s financial markets will reopen tomorrow.

Pre-Market U.S. Stock Movers

Advanced Micro Devices (AMD) rose over +1% in pre-market trading after DZ Bank upgraded the stock to Buy from Hold with a $250 price target.

Rocket Lab USA (RKLB) climbed over +6% in pre-market trading after signing a new multi-launch deal with Japan’s Institute for Q-shu Pioneers of Space.

Confluent (CFLT) jumped more than +19% in pre-market trading after Reuters reported that the company was exploring a sale.

Penguin Solutions (PENG) tumbled over -22% in pre-market trading after the semiconductor company posted weaker-than-expected FQ4 revenue and issued below-consensus FY26 guidance.

FedEx (FDX) fell more than -2% in pre-market trading after JPMorgan downgraded the stock to Neutral from Overweight.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Wednesday - October 8th

AZZ (AZZ), Resources Connection (RGP), Richardson Electronics (RELL), Bassett (BSET).