All eyes are on Fed Chair Powell's rhetoric, and the vaunted "dot plot"
Stock futures are trading quietly ahead of the Federal Reserve's final interest rate decision of 2025. CME's FedWatch tool is pricing in an 89.6% chance of a 25 basis-point cut, which will be announced at 2 p.m. ET today, followed by highly-anticipated comments from Fed Chair Jerome Powell. The "dot plot" concerning future rate cuts will also be a hot-button issue.
Bond yields are spiking ahead of the event, with the 10-year Treasury yield last seen at 4.2%, four-month highs. Elsewhere, the employment cost index rose 0.8% in the third quarter, just below analysts' estimated 0.9%, matching the smallest gain since the same quarter in 2020.
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5 Things You Need to Know Today
- The Cboe Options Exchange saw over 1.7 million call contracts and more than 1.1 million put contracts exchanged on Tuesday. The single-session equity put/call ratio fell to 0.52, while the 21-day moving average remained at 0.58.
- GameStop Corp (NYSE:GME) stock is down 5.8% premarket, despite the video game retailer's third-quarter earnings beat, as revenue missed expectations. Heading into today, the former meme stock is down 26.3% year to date.
- Blue Owl Capital Inc (NYSE:OWL) is 2.3% higher before the bell, after Raymond James upgraded the asset management company to "strong buy" from "market perform," suggesting the stock is currently undervalued. BofA Global Research also cut its price target to $23 from $27, however. Since the start of 2025, OWL is down 28.3%.
- EchoStar Corp (NASDAQ:SATS) is up 3.7% in electronic trading, after an upgrade from Morgan Stanley to "overweight" from "equal weight," with a price-target hike to $110 from $82. A potential SpaceX initial public offering (IPO) has been lifting the shares as well, as the company holds significant stake. Should these gains hold, SATS will extend last sessions record highs.
- See what's coming up this week aside from rate-cut buzz.
Global Markets Unpack Data, Eye Stateside Fed Buzz
Asian markets finished mostly lower, with eyes on China’s consumer price index (CPI), which rose 0.7% year-on-year in November, coming in line with estimates. Meanwhile, factory-gate prices for the country fell more than expected, down 2.2% for the previous month amid continued deflation. For the day, Hong Kong’s Hang Seng was the only gainer, adding 0.4%. China’s Shanghai Composite and South Korea’s Kospi each fell 0.2%, while Japan’s Nikkei lost 0.1%.
With the interest rate decision in focus, European markets are mixed. At last check, France’s CAC 40 is off 0.3%, Germany’s DAX is 0.5% lower, and London’s FTSE 100 is up 0.3%.