The stock market gears up for a subdued opening on Tuesday, following a surge triggered by a disappointing jobs report, which bolstered speculations of impending interest rate cuts by the Federal Reserve this year.
Dow Jones Industrial Average futures show a modest increase of 37 points, equivalent to 0.1%, while S&P 500 futures remain nearly unchanged, rising less than 0.1%. Conversely, Nasdaq 100 futures exhibit a minor decline of 0.1% in premarket trading.
Market sentiment reflects a prevailing anticipation of a 90% likelihood that the Federal Reserve will reduce benchmark rates before the year concludes, as per assessments by CME Group.
Commenting on the market dynamics, ING analyst Chris Turner noted in a research briefing on Tuesday, “Interest rate, equity, and FX [foreign exchange] volatility are witnessing a notable decline as the prospect of diverging monetary policy trajectories diminishes. This trend could persist leading up to the crucial release of US April CPI [consumer price index data] next week.”
In early trading on Tuesday, the yield on the benchmark 10-year Treasury note edged down to 4.462% from the previous day’s level, underlining the prevailing cautious sentiment among investors.
