U.S. stock futures edged higher on Thursday morning after the major indexes fell sharply as traders weighed another sharp rate hike from the Federal Reserve.
Dow Jones Industrial Average futures rose 83 points, or 0.3%. S&P 500 futures and Nasdaq 100 futures rose about 0.2% each.
On Wednesday, the Dow Jones Industrial Average fell 522 points, or 1.70%. The S&P 500 fell 1.71% and the Nasdaq Composite fell 1.79%. The sharp drop came at a time of turmoil after the Fed raised rates for the third time in a row by 0.75 percentage point. The Dow Jones rose more than 300 points at one point.
But stocks ended lower, extending a recent sell-off as investors assessed the Fed’s latest comments. Policymakers pledged to continue raising interest rates by as much as 4.6 percent in 2023 before pulling back on the fight against inflation, stoking Wall Street’s fears that the economy could slip into recession.
The central bank is expected to raise its year-end interest rate to 4.4% in 2022, continuing to take aggressive action against rising prices for the rest of the year.
“I think they should slow down,” DoubleLine Capital CEO Jeffrey Gundlach said Wednesday on CNBC’s “Closing Bell: Overtime.” “Monetary policy has a long and volatile lag, but we have tightened for a while now,” he added, noting that the impact of tightening could lead to a recession.
On the economic front, the latest data on weekly jobless claims is expected at 8:30 a.m. ET on Thursday.