© Reuters. FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 29, 2022. REUTERS/Brendan McDermid
By Ankika Biswas
(Reuters) – U.S. stock index futures were little changed on Thursday after a strong Wall Street rally in the previous session on hopes of a potential downshift in the Fed’s policy on aggressive rate hikes, while Salesforce (NYSE:) fell on news of its co-CEO to step down.
Federal Reserve Chair Jerome Powell said on Wednesday it was time to slow down coming interest rate hikes, while also signaling a protracted economic adjustment amid high borrowing costs.
The closed above its 200-day moving average for the first time since April in the previous session, while the ended over 4% higher.
“Seeing a little bit of profit taking,” said Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey. “I wouldn’t be surprised at all to see market continue its rally.”
Powell, however, cautioned that the fight against inflation was far from over and indicated that the terminal rate will be “somewhat higher” than the 4.6% indicated by policymakers in their September projections.
Traders are now seeing a 91% chance that the Fed will increase its key benchmark rate by 50 basis points in December, with the terminal rate expected to peak under 5% in May 2023. [FEDWATCH]
Due later in the day, the Commerce Department’s personal consumption expenditure (PCE) index, the Fed’s preferred inflation metric, likely rose 0.8% in October from 0.6% in the previous month.
The core PCE, excluding volatile items, is seen easing to 0.3% from 0.5% in September.
Investors also await nonfarm payrolls data on Friday, with the ADP report on Wednesday suggesting cooling demand for labor.
At 7:19 a.m. ET, were down 56 points, or 0.16%, were down 2 points, or 0.05%, and were down 13.25 points, or 0.11%.
Salesforce Inc lost 7.3% in premarket trading on Thursday after the software maker said Bret Taylor would step down as co-chief executive officer in January and that co-founder Marc Benioff will become the sole CEO.
Most megacap technology and growth stocks like Alphabet (NASDAQ:) Inc, Apple Inc (NASDAQ:), Microsoft Corp (NASDAQ:), Tesla (NASDAQ:) Inc and Meta Platforms Inc (NASDAQ:) were down between and 0.1% and 0.2%.
Costco Wholesale Corp (NASDAQ:) fell 2.8% after the membership-only retail chain reported slower sales growth in November.
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