Tech mega-caps lift US futures as crypto stumbles; Fed ‘neutral rate’ split clouds rate-cut path
A tech-led bid in US stock futures contrasts with risk-off in digital assets, as debate over the Federal Reserve’s true neutral rate keeps Treasury yields and the dollar underpinned. Traders are weighing strong earnings from select growth names against stretched valuations and a shaky crypto tape.
Equities: Big tech leads, earnings spark selective momentum
Apple, Broadcom, Nvidia and Shopify were early leaders in US futures, reinforcing the market’s reliance on mega-cap growth to support headline indices. Credo and MongoDB jumped more than 20% after upbeat results, though traders are flagging valuation risk as rates stay elevated and growth multiples remain rich.
Monster Beverage continued its renaissance, up 21.7% quarter-to-date after a 16.7% earnings-per-share beat in Q3. The stock is trading above its 50- and 200-day moving averages, with the sell-side skewed to “Moderate Buy,” underscoring the market’s preference for resilient cash-generative growth.
In Europe, Bayer shares surged about 11% following indications of US support at the Supreme Court related to Roundup litigation—fueling hopes for a path to reduced legal overhang. The rally provided a tailwind to German benchmarks and improved sentiment toward beaten-down continental healthcare names.
Crypto: Risk appetite frays as privacy coins tumble
Bitcoin slipped toward $65,000, dragging majors including Ether, Cardano and XRP, while crypto equities like Coinbase came under pressure. Privacy tokens bore the brunt: Zcash fell 8.5%, Monero 5.4% and Dash 3.9%, with the broader privacy cohort down roughly 15.4%. Once billed as “digital havens,” these coins are trading more like high-beta risk assets.
MicroStrategy saw volumes spike to about 42.9 million shares as its stock dropped 3.25%, with traders reassessing its profit outlook amid Bitcoin’s slump and scrutinizing the sensitivity of its crypto-heavy treasury to price drawdowns and funding costs.
Macro and FX: Neutral-rate rift keeps dollar bid
Fed officials’ estimates for the economy’s neutral rate—where policy is neither restrictive nor stimulative—remain wide, reportedly spanning 2.6% to 3.9%. That dispersion complicates the rate-cut calculus for 2025, especially as artificial intelligence-driven productivity and potential tariff shifts cloud the growth-inflation mix.
For FX, an uncertain r-star and sticky US real yields tend to support the dollar on dips, cap risk currencies and pressure emerging-market FX with higher external funding needs. The cross-asset message: while equities can rally on micro beats, the macro backdrop still argues for patience on aggressive Fed easing.
Market snapshot
- US stock futures firmer on mega-cap leadership; selective earnings beats stoke momentum.
- Credo and MongoDB surge 20%+, but stretched valuations draw caution.
- Bitcoin slips near $65k; privacy coins drop 3.9%–8.5% as the sector slides ~15.4%.
- Bayer jumps ~11% on hopes for US Supreme Court support easing Roundup litigation risk.
- Monster Beverage up 21.7% QTD after a 16.7% EPS beat; above 50/200-DMAs.
- MicroStrategy volume swells to ~42.9m shares on a 3.25% decline; crypto-treasury under scrutiny.
- Fed neutral-rate estimates (2.6%–3.9%) keep Treasury yields sticky and the dollar supported.
What traders are watching
Stock leadership breadth
Concentration risk remains elevated: a handful of mega-caps are doing the heavy lifting. Broader participation will be crucial if the rally is to extend without multiple expansion.
Valuation vs. rates
With real yields still positive, high-growth names face a thin margin for error. Any pushback from the Fed on the easing timeline could force a re-rating.
Crypto liquidity and spillovers
Tighter liquidity in digital assets is amplifying moves. Stress in Bitcoin and privacy coins is feeding into crypto-exposed equities and could spill into broader risk if volatility persists.
Policy signals
The r-star debate, AI-driven productivity uncertainty and tariff risks all complicate the macro map. For FX, that mix favors the dollar on dips and keeps carry trades sensitive to US data surprises.
As always, liquidity around key data releases can swing FX and equity volatility quickly. Traders told BPayNews they’re keeping risk tight into macro catalysts.
FAQ
Why are US stock futures higher today?
Stronger sentiment toward mega-cap tech and upbeat earnings from select growth names are lifting futures. However, gains remain narrowly led, and higher real yields limit multiple expansion.
How does the Fed’s neutral-rate debate affect FX?
A higher or uncertain r-star implies policy may stay relatively tight for longer, supporting US yields and the dollar. That can weigh on risk-sensitive and emerging-market currencies.
What’s behind the crypto selloff?
Bitcoin’s drift toward $65,000, thin liquidity and fading haven narratives for privacy tokens have pressured the complex. Crypto equities are reacting to the same risk-off tone.
Why did Bayer rally?
Reports of US support at the Supreme Court related to Roundup cases raised hopes of reduced litigation risk. That eased a major overhang on the shares and buoyed sentiment in European healthcare.
Are earnings still a catalyst for stocks?
Yes—names like Credo, MongoDB and Monster Beverage show micro drivers matter. But with rates elevated and valuations full, disappointments can trigger outsized downside moves.
