Stock Futures Point Higher to Begin Holiday-Shortened Week

Stock futures pointed higher Monday to begin a holiday-shortened week, with investors increasingly confident the Federal Reserve will cut interest rates at its December meeting.

Futures associated with the tech-heavy Nasdaq, benchmark S&P 500, and blue-chip Dow Jones Industrial Average were up a respectively 0.7%, 0.5%, and 0.2%.

Stock and bond markets will be closed Thursday for the Thanksgiving holiday, and will be closing early on Friday.

The CME FedWatch tool now is predicting a roughly 75% likelihood that the Federal Reserve will cut interest rates at its meeting next month after New York Fed President John Williams signaled Friday that he could support an additional rate cut by the central bank “in the near term.” 

On Friday, the three indexes all rose roughly 1% following Williams’ comments but nevertheless finished sharply lower for the week, with the Nasdaq dropping 2.7% and the Dow and S&P down 1.9% apiece.

Indexes sank on concerns about AI spending and valuations of big tech firms. Shares of AI darling Nvidia (NVDA) fell about 6% over the five sessions even though the world’s most valuable company reported blockbuster third-quarter results and issued a rosy outlook Wednesday. Nvidia shares were up 0.6% in premarket trading Monday.

Shares of Google parent Alphabet (GOOG, GOOGL) continued their recent ascent after the company last Tuesday unveiled Gemini 3, the latest iteration of its flagship AI model. The stock added more than 8% of its value last week and was up a further 3.5% before the bell. Meanwhile, shares of fellow Magnificent Seven firm Tesla (TSLA) rose 2% after CEO Elon Musk wrote in a post on his X network that the EV maker expects “to build chips at higher volumes ultimately than all other AI chips combined.”

U.S.-listed shares of Novo Nordisk (NVO) sank 10% as a trial to see whether the active ingredient in the Danish firm’s blockbuster weight-loss drugs Ozempic and Wegovy could help slow the progression of Alzheimer’s disease “did not confirm superiority of semaglutide versus placebo.”

Also, shares of Performance Food Group (PFGC) dropped more than 4% and those of fellow food-distribution firm US Foods Holdings (USFD) rose 2.5% after the companies called off a proposed merger.

Bitcoin, which is coming off its worst week since February, recently was trading around $86,000, up from its weekend low of below $83,500. The yield on the 10-year Treasury note ticked lower to 4.05%. The U.S. dollar index, which tracks the performance of the dollar against a basket of foreign currencies, slipped 0.2% to 100.02.

WTI crude futures, the U.S. oil benchmark, ticked higher to $58.10 per barrel. Gold futures were little changed at $4,075 per ounce.