US stock futures rose on optimism that the Federal Reserve will cut interest rates next month, after the S&P 500 and Nasdaq closed at record highs. A softer July inflation reading increased expectations for a September rate cut, with market tools showing a 94% probability of a 0.25% reduction—up from 85% before the data release.
Some market voices, including Treasury Secretary Scott Bessent, suggested the Fed should consider a larger 0.50% cut to support economic momentum, especially in light of recent revisions showing weaker job growth in May and June. Analysts believe earlier access to this data might have prompted the Fed to lower rates sooner.
Ahead of the market open, Dow futures rose 0.24%, S&P 500 futures added 0.17%, and Nasdaq futures gained 0.24%. Investors are also awaiting the latest producer price index report, offering insight into inflation from a business cost perspective.