US futures remain subdued so far today

US futures steady as traders bet on December Fed cut; AI valuation jitters cap Nasdaq

S&P 500 futures were little changed early Thursday, with Nasdaq futures slightly softer and Dow futures marginally higher, as investors weigh a resilient rebound in equities against persistent nerves over stretched AI valuations and a Federal Reserve decision that arrives without fresh CPI or payrolls data.

Market snapshot

The relief rally from last week remains intact, leaving the S&P 500 within roughly 1% of record territory, even as megacap tech—especially AI-linked leaders—faces renewed scrutiny. The tone is calm rather than exuberant: risk appetite is steady, liquidity conditions are orderly, and equity volatility gauges remain subdued.

Key Points

• US equity futures flat to slightly mixed as AI valuation concerns restrain the Nasdaq.
• S&P 500 sits about 1% from record highs, underscoring resilient risk appetite.
• Challenger job cuts and weekly jobless claims in focus; neither is likely to trump the Fed narrative.
• Market pricing still leans toward a December rate cut, with few catalysts to shift the Fed’s path.
• No new CPI or non-farm payrolls data before the Fed meeting, reinforcing a “wait-and-see” trade.
• Dollar and Treasury yields are steady in tight ranges, keeping FX volatility contained.

Macro focus: labor signals without the big two

Investors get a look at US Challenger job cuts and initial jobless claims, incremental reads on labor demand and churn. Without CPI or non-farm payrolls before the Fed convenes, these prints are unlikely to swing policy expectations materially. Barring a shock, the bar to dissuade the Fed from delivering a December rate cut remains high.

Policy watch: December cut seen as base case

Rates markets continue to price a near-term reduction in the policy rate, emphasizing the debate over the 2026 path rather than the December outcome itself. The question for investors has shifted to the speed and depth of easing next year, how quickly wage disinflation progresses, and where the “new neutral” settles for real rates.

Cross-asset moves: FX and yields stay range-bound

Treasury yields are subdued in early trading, keeping the US dollar broadly stable against major peers. EUR/USD is holding in a tight range while USD/JPY consolidates as rate differentials show little intraday impulse. FX volatility remains muted, consistent with steadier equity sentiment and a data-light calendar. Commodity currencies are treading water, with sentiment tethered more to risk proxies than to fresh macro surprises.

Tech-led sentiment: AI premium under review

Nerves around AI-linked valuations persist, with Nvidia and the broader chip complex still the temperature check for momentum. A modest de-risking in AI-heavy exposures could spark a shallow pullback, but the broader market’s constructive tone—underpinned by easing prospects and contained inflation uncertainty—continues to temper downside.

What could break the calm?

A surprise spike in layoff announcements or a jump in jobless claims would challenge the “soft landing” narrative and could weigh on cyclicals and high-beta FX. Conversely, signs of resilient labor demand could nudge yields higher at the margin, supporting the dollar and pressuring duration-sensitive tech. For now, the base case is quiet trading ahead of the Fed, with traders focused on the 2026 policy glide path rather than December.

FAQ

Why are US futures flat despite record-high proximity for the S&P 500?

Positioning is already constructive and the calendar is light. With no CPI or payrolls before the Fed, many are waiting for policy clarity. AI valuation worries are capping upside in growth-heavy indices like the Nasdaq.

How important are today’s jobless claims and Challenger job cuts?

They matter at the margin for labor-market tone but are unlikely to change the near-term policy path. Markets see a high bar to derail a December cut without a major surprise.

What does this mean for the US dollar?

Range-bound trading. Stable Treasury yields and a data-light backdrop are keeping the dollar contained. A surprise in labor data could shift yields and nudge FX, but big moves likely await the Fed decision.

Is the AI trade at risk of a deeper correction?

Valuation sensitivity is elevated, especially for megacaps. A modest pullback is possible if earnings revisions stall or yields pop. However, broader risk appetite remains supported by easing expectations and restrained volatility.

What should traders watch next?

Weekly claims for any inflection, sector breadth in US equities, and the tone of the Fed statement and press conference. Forward guidance on the 2026 rate path will be key for stocks, yields, and FX. For more market analysis, follow BPayNews.