U.S. stock futures steady after Nasdaq hits record on reduced Fed hike bets

Investing.com-- U.S. stock futures were little changed on Monday evening after the Nasdaq Composite closed at a record high, aided by reduced expectations for a Federal Reserve interest-rate hike this month, while investors turned their attention to the start of the quarterly earnings season.

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S&P 500 Futures inched 0.1% higher to 7,837.25 points, while Nasdaq 100 Futures rose 0.2% to 31,393.75 points by 21:10 ET (01:10 GMT). Dow Jones Futures traded 0.1% higher at 51,644.0 points.

In Monday's regular session, the NASDAQ Composite rose 1.1% to a record 27,477.31, while the S&P 500 gained 0.7%, bringing it close to its record high. The Dow Jones Industrial Average added 0.2%.

Technology shares led the advance, with Nvidia rising 2.1% to a record market value of about $5.76 trillion, while Microsoft, Meta Platforms and Tesla also gained.

The gains extended a rally that began after Friday's employment report showed U.S. job growth slowed more than expected in September, prompting investors to sharply scale back expectations for a rate increase at the Fed's October meeting.

Traders now see about a 20% chance of an October rate hike, down from roughly 70% a week earlier, according to CME FedWatch data. A December increase remains largely priced in.

The softer rate outlook has supported equities even as borrowing costs remain elevated.

The 10-year Treasury yield rose to 5.31% on Monday, near 2002 highs, as investors continued to assess heavy government debt issuance and persistent inflation risks.

Oil prices provided some relief to equity investors. Brent crude held steady after settling down 2% on Monday.

Prices declined after Middle East crude exports increased and Group of Seven nations pledged to boost supplies, although concerns over disruptions linked to the U.S.-Israeli conflict with Iran limited the decline.

Investors are now looking toward corporate earnings for the next catalyst. Third-quarter results from major U.S. banks are due to begin next week, while PepsiCo and Delta Air Lines are among companies scheduled to report this week.

The Federal Reserve's minutes from its September meeting, due Wednesday, will also be closely watched for clues on how policymakers view inflation and the softer labor market.

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