U.S. stock futures retreated Thursday as disappointing results from Oracle reignited concerns about the pace of artificial intelligence spending. The pullback offset optimism from the Federal Reserve’s latest rate cut, signaling renewed caution across equity markets. At 06:10 ET (11:10 GMT), Dow futures dropped 90 points (0.2%), S&P 500 futures fell 38 points (0.5%), and Nasdaq 100 futures declined 205 points (0.8%).
The sentiment shift comes after major indexes advanced in the previous session. The S&P 500 closed 0.7% higher at 6,886.68, the Dow gained 1.1% to 48,057.75, and the Nasdaq Composite added 0.3%, edging closer to its recent highs. Markets initially welcomed the Fed’s 25-basis-point rate cut—its third in the current easing cycle—but investor enthusiasm cooled as earnings concerns resurfaced.
Fed Signals More Easing Ahead
The Federal Reserve lowered its benchmark rate by 25 basis points, aligning with market expectations. Chair Jerome Powell delivered a more balanced tone, emphasizing that future cuts will require clearer signs of economic softening. The central bank also announced an immediate plan to purchase $40 billion in short-term Treasury bills per month to support market liquidity.
Fed officials projected one additional rate cut next year, though internal divisions around December’s move highlighted ongoing uncertainty. Analysts at ING noted that cooling labor market conditions could prompt more cuts than currently forecast.
Key Fed takeaways:
- Third rate cut of the cycle
- Monthly $40B Treasury bill purchases
- Officials forecast one more cut next year
These policy moves provided temporary tailwinds to markets, though concerns from the corporate sector soon overshadowed them.
Oracle’s Outlook Weighs on Tech Sector
Shares of Oracle slumped after the company sharply increased its capital spending guidance for fiscal 2026, raising broader doubts about the profitability of its expanding AI infrastructure. The firm’s growing debt load—after issuing billions in bonds this year—added another layer of investor concern.
Meanwhile, Adobe delivered upbeat revenue and profit forecasts, suggesting stronger momentum in AI-driven product offerings. More earnings are due from Broadcom, Costco, and Micron, giving investors additional data to parse in the coming days.
In commodities, oil prices slipped as markets reassessed supply risks. Brent crude fell 1.4% to $61.36, and WTI dropped 1.4% to $57.66, retracing gains from the prior session following the U.S. seizure of a sanctioned Venezuelan tanker. The International Energy Agency added a marginally supportive note by upgrading its global demand outlook for next year while trimming supply projections.