US stocks looked poised to pare some of their losses on Thursday after Federal Reserve Chairman Jerome Powell put a lump in the markets' Christmas stocking by pointing out that sticky inflation meant investors he should not expect deep rate cuts next year.
Futures tracking the Dow Jones Industrial Average climbed 321 points, or 0.8%. S&P 500 futures rose 0.8%, and contracts linked to the tech-heavy Nasdaq 100 rose 0.7%. All three indexes plunged on Wednesday, with Powell hawkish sinking the Dow 1,100 points to end his longest losing streak in half a century.
The mini-rebound will do little to ease Wall Street's somber mood. The Fed stuck to the script by cutting interest rates a quarter point, but Powell delivered a message no one wanted to hear: Because inflation is still running above the central bank's 2% target, investors should expect it to cut only twice borrowing costs. next year.