U.S. stock index futures edged higher Monday, with investors looking past the prolonged government shutdown and focusing instead on growing expectations for Federal Reserve rate cuts this month.
By 06:12 ET (10:12 GMT):
- Dow Jones Futures: up 88 points (+0.2%)
- S&P 500 Futures: up 24 points (+0.4%)
- Nasdaq 100 Futures: up 142 points (+0.6%)
The S&P 500 and Dow Jones Industrial Average closed at record highs on Friday, while the Nasdaq Composite dipped 0.3%. Despite the shutdown, markets remain buoyed by optimism that lower borrowing costs could sustain momentum in equities through the fourth quarter.
The absence of government data—particularly the nonfarm payrolls report, delayed due to the shutdown—has placed more weight on private sector indicators. Analysts at Vital Knowledge said recent employment and business surveys showed “darkening storm clouds” for growth but also hinted that easing inflation pressures could justify further Fed cuts.
Investors Eye October Fed Decision
The Federal Reserve’s next policy meeting in October looms large as traders increasingly price in another rate reduction. According to CME FedWatch, markets see a nearly 100% probability of a 25-basis-point cut this month.
Analysts note that despite delayed data, weak private payroll numbers and softening job openings have reinforced the case for easing.
Key data points shaping expectations:
- ADP Employment (Sept): –32,000 jobs; annual pay growth 4.5%
- Job Openings: rose slightly to 7.23 million, but hiring slowed to a 15-month low
- Challenger layoffs: showed mild improvement after summer job cuts
Meanwhile, political tensions continue to cloud the outlook. The White House warned Sunday that mass layoffs of federal workers could begin if budget talks between President Donald Trump and congressional Democrats remain stalled.
Earnings and Commodities in Focus
In corporate news, Constellation Brands (NYSE: STZ) will report its August-quarter results after Monday’s close. The beverage group missed both sales and profit forecasts last quarter, pressured by aluminum tariffs and softer consumer spending on beer and wine.
Separately, Critical Metals Corp. (NASDAQ: CRML) shares surged over 75% in premarket trading amid reports the U.S. government may convert a $50 million Defense Production Act grant into an 8% equity stake in the Greenland rare earth developer. The move would give Washington direct exposure to one of the world’s largest untapped rare earth deposits.
Oil also rebounded sharply after OPEC+ announced a modest 137,000 bpd output hike for November—well below market fears of a larger increase. Brent crude rose 1.9% to $65.76, while WTI gained 2.0% to $62.09.
