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Stock futures are little changed ahead of the Federal Reserve’s interest rate decision expected Wednesday.
Futures tied to the Dow Jones Industrial Average fell 19 points, or 0.03%. S&P futures and Nasdaq 100 futures hovered below the flatline.
Stocks have been teetering between slight gains and losses in recent sessions as investors await this week’s key Fed meeting, which is the final one of the year. The Fed is widely expected to deliver its third straight interest rate cut of a quarter percentage point, with fed funds futures suggesting a roughly 87% chance of a decrease, according to CME’s FedWatch tool.
Sentiment among members of the rate-setting Federal Open Market Committee remains divided, however, as some favor cuts to stave off further labor market weakness and others believe another cut could worsen inflation. Investors are looking to gauge members’ sentiment from the post-meeting statement and Chair Jerome Powell’s highly anticipated news conference Wednesday afternoon.
The previous session saw lackluster moves in the broader market. The S&P 500 closed down 0.1% on Tuesday while the Dow Jones Industrial Average lost nearly 0.4%, weighed down by losses in JPMorgan shares. The tech-heavy Nasdaq Composite added about 0.1%, lifted by gains in Broadcom, Tesla and Google parent Alphabet.
A sector rotation has emerged, however. The Russell 2000 index of small-cap companies hit a fresh all-time intraday high on Tuesday, strengthened by the prospect of upcoming rate cuts. Smaller companies tend to benefit from rate cuts because their borrowing costs are more linked to market rates, and could therefore boost their profit margins.
Wells Fargo Investment Institute global equity strategist Doug Beath noted that the Russell 2000 is underperforming the S&P 500 this year, but has rallied since Nov. 21 and outperformed the broad-market index since that date.
“The favorable change for small-cap equities is consistent with our view that equity market breadth is widening,” Beath said. “We believe investors are looking beyond the current economic soft patch in anticipation of accelerating economic growth through 2026 because of positive secular trends already in place — tax cuts that will deliver what should be the largest refunds since 2021, deregulation, more Fed rate cuts, and continued technology capex growth.”
Oracle’s AI-fueled debt load has investors on edge ahead of quarterly earnings
It’s been a rollercoaster year for Oracle investors, as they try to assess the strength of the software giant’s position in the artificial intelligence boom.
Heading into the company’s fiscal second-quarter earnings report on Wednesday, pressure is building on management — and newly installed CEOs Clay Magouyrk and Mike Sicilia — to show that Oracle can continue to finance the company’s aggressive infrastructure plans while simultaneously convincing Wall Street that the AI-fueled hypergrowth story remains intact.
“There is something inherently uncomfortable as a credit investor about the transformation of the sort we’re facing that is going to require an enormous amount of capital,” Daniel Sorid, head of U.S. investment grade credit strategy at Citi, said on a video call to investors on Friday, a replay of which was provided to reporters.
Shares of Oracle are up nearly 33% year to date even its double-digit losses in October, which was its worst month since 2001. More here.
—Seema Mody
AeroVironment, GE Vernova and Cracker Barrel are among the stocks moving Tuesday night
Check out the companies making headlines in after-hours trading:
AeroVironment — Shares of the defense technology provider slid more than 4% after its second-quarter earnings missed analyst expectations, coming in at 44 cents per share on an adjusted basis. That’s well below the 78 cents per share that analysts surveyed by LSEG estimated. The company’s revenue of $473 million, however, beat the consensus estimate of $468 million.
Cracker Barrel Old Country Store — Shares of the restaurant company dropped about 9% in extended trading after Cracker Barrel’s first-quarter revenue came out worse than Wall Street had expected. Cracker Barrel reported $797.2 million in revenue for the period, while analysts’ polled by FactSet expected $800.3 million. The company reported a narrower-than-expected adjusted loss, meanwhile.
GE Vernova — The energy giant saw shares climb roughly 7% after it raised its 2026 revenue forecast to a range of $41 billion to $42 billion for 2026, compared with expectations of between $36 billion and $37 billion for this year. The company, which has benefited from strong power demand this year, also doubled its quarterly dividend to 50 cents from 25 cents per share and authorized the buyback of $10 billion of stock.
For the full list, read here.
— Pia Singh
U.S. stock futures open little changed
Shortly after 6 p.m. ET on Tuesday, futures tied to the S&P 500 and Nasdaq-100 futures each hovered near the flatline. Futures tied to the Dow Jones Industrial Average shed 10 points, or less than 0.1%.
— Pia Singh
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