Fed’s decision to maintain interest rates drops single stock futures

Fed’s Hold on Rates Impacts Single-Stock Futures

Single-stock futures have been mostly trading sideways with a slight dip. This move followed the Fed’s decision this Wednesday to not touch interest rates. When looking at several indices, you can see the impact as no hot futures that relied on them lowered. So futures with links to the Dow Jones lowered by 0.04%, going 0.10% down for the S&P 500 and 0.20% down for the NASDAQ. So Wall Street has taken a minor hit, it seems.

If we look directly at some stocks, we see a mixture of movements. Homebuilder KB Home dropped down by 2.00% even though analysts expected a more positive outcome. Klaviyo, a company that automates marketing material, also dropped, going down by 2.00% this Wednesday. Meanwhile, FedEx rose up by 5.00%. This likely is due to the release of their recent earnings report, with their adjusted earnings standing at $4.55 for each share.

Overall though, the change is in the negative for the day, although not excessively so for managed futures.

As we stated earlier, the Fed has decided to skip on shifting interest rates. This is likely the source of the drop in stocks. However, this is only for now. The Fed has strongly implied that it will still be raising rates by the end of the year. The economy might be able to take this interest hike well, but there is no guarantee, according to the Fed.

Many analysts feel surprised at the move and how well the economy is doing in general. They have seen GDP going up over the course of this year. The main indicator for the positive projection is the 10-year treasury yields. It has reached a 16-year high, with a similar story for the 2-year treasury yields. Employment data this Thursday will likely cause further movements on single-stock futures in the near future.

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