Wall Street ticked quietly higher ahead of the opening bell Wednesday as markets absorbed another spate of corporate earnings reports while waiting to see what the Federal Reserve will do with its benchmark interest rate.
In premarket trading, futures for the S&P 500 were up 0.1%, while futures for the Dow Jones Industrial Average were essentially flat. Nasdaq futures rose 0.3%.
Most analysts expect the Fed to keep its benchmark borrowing rate around 4.3% and again cite uncertainty around the economic impacts of President Donald Trump‘s widespread tariff increases on imports to the U.S.
However, there have been hints of dissent from Trump-appointed Fed governors Christopher Waller and Michelle Bowman, underscoring a difference of opinion about how the U.S. economy is doing. Unemployment is low but hiring has been sluggish. Overall economic growth has been modest in the first six months of the year and inflation ticked up in June, largely because of tariffs.
Most economists, and Fed officials, think that a rate cut could make inflation worse.
Waller's position, which he has spoken about publicly, is that labor market growth is stalling and the Fed should not wait for further deterioration to cut interest rates. The government will issue its latest jobs report on Friday, with analysts forecasting that U.S. nonfarm employers added 115,000 jobs in July, down from June's surprisingly strong 147,000.
Trump has also been vocal about his desire for a rate cut, saying it would boost an already strong economy. Trump's theory runs counter to most economists, who say that a healthy, growing economy doesn’t need rate cuts.
The Fed will announce its interest rate policy decision Wednesday afternoon before markets close.
In overnight equities trading, Starbucks shares rose more than 5% after the retail coffee giant said it’s confident that improved store operations and new products — including a cold foam protein drink — will soon help turn around the company’s lagging U.S. sales. Starbucks beat Wall Street's third-quarter sales targets but missed profit forecasts as same-store sales fell 2%.
Elsewhere, global markets were mixed after the U.S. and China ended their latest round of trade talks without a deal.
Beijing’s top trade official said China and the United States agreed during two days of talks in Stockholm, Sweden, to work on extending an Aug. 12 deadline for imposing higher tariffs on each other. The U.S. side said an extension was discussed, but not decided on.
Treasury Secretary Scott Bessent said Trump would make that call. If there is no extension, tariffs could “boomerang” back to higher levels, he said.
