© Reuters. Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., March 7, 2024. REUTERS/Brendan McDermid/File Photo
By Bansari Mayur Kamdar and Shashwat Chauhan
(Reuters) -Wall Street’s main stock indexes were set to open higher on Thursday as chip stocks rallied following Micron Technology (NASDAQ:)’s upbeat forecast, while investors took comfort in the Federal Reserve sticking to its three-rate-cut view for this year.
Wall Street rallied on Wednesday, with the notching a record high after U.S. central bankers kept borrowing costs unchanged and indicated they still expect to ease interest rates by three-quarters of a percentage point by the end of 2024.
“The tone was very much expected, it was basically saying that yes, we’re getting closer to the point where we can cut rates, but we still need more data,” said Mohit Kumar, chief European economist at Jefferies.
Inflation reports “haven’t really changed the overall story, which is that of inflation moving down gradually on a sometimes bumpy road to 2%,” Fed Chair Jerome Powell said in a press conference after the policy meeting.
The CME FedWatch tool showed the market is now pricing in a 70% chance of a Fed rate cut in June, compared with around 56% at the beginning of the week.
UBS Global Research said that it now expects the first cut in June, compared with its prior forecast of a cut in May.
Chipmaker Micron Technology jumped 17.3% in trading before the bell after posting a surprise quarterly profit and forecasting third-quarter revenue above estimates.
Peers such as Intel (NASDAQ:) and Nvidia (NASDAQ:) added more than 1% each, while Western Digital (NASDAQ:) jumped 7.2%.
Broadcom (NASDAQ:) gained 2.9% as TD Cowen upgraded its rating to “outperform”.
A report from the Labor Department showed initial claims for state unemployment benefits dropped 2,000 to a seasonally adjusted 210,000 for the week ended March 16, compared to economists’ forecast of 215,000 claims.
Investors awaited business activity data due later in the day.
At 8:30 a.m. ET, were up 117 points, or 0.29%, were up 26.25 points, or 0.5%, and were up 186 points, or 1.01%.
Most rate-sensitive megacap growth and technology stocks also advanced in premarket trading.
Apple (NASDAQ:), however, eased 0.7% on a report that the U.S. Department of Justice is preparing to sue the company as soon as Thursday for allegedly violating antitrust laws.
IT services provider Accenture (NYSE:) fell 6.8% after it cut its fiscal-year 2024 revenue forecast, as an uncertain economy prompts clients to cut spending on its consulting services
Reddit’s shares are expected to start trading on the New York Stock Exchange later in the day under the ticker ‘RDDT’ after the social media platform priced its initial public offering at the top end of its targeted range of $31 to $34 per share.
