U.S. Stock Futures Edge Higher Ahead of Fed Symposium and Retail Earnings

Stock futures traded modestly higher early Monday as Wall Street looked to extend recent gains, supported by optimism over potential interest rate cuts from the Federal Reserve and solid corporate earnings.

Dow Jones Industrial Average futures rose 57 points, or 0.13%, while S&P 500 futures added 0.14%. Nasdaq 100 futures gained 0.21%, continuing momentum from last week’s strong performance across major indexes.

Momentum Builds on Wall Street

The positive start to the week comes after the Dow advanced 1.7% last week, its second straight weekly gain. The S&P 500 added 0.9% and the Nasdaq Composite rose 0.8%. Both indexes have now logged gains in four of the past five weeks, reinforcing investor confidence in the resilience of U.S. markets.

Notably, small-cap Stock Futures significantly outperformed, climbing more than 3% last week. The move suggests traders are positioning for a more favorable rate environment and a potential pickup in domestic economic activity.

Ross Mayfield, investment strategist at Baird Private Wealth Management, noted that the S&P 500 Equal Weight Consumer Discretionary index recently reached an all-time high, pointing to renewed consumer strength despite concerns about inflationary pressures.
“With the market’s message quite upbeat … it raises the question of whether the conventional wisdom about a weakening U.S. consumer and potential stagflation is missing the mark,” Mayfield said in a note Friday.

Focus Turns to Federal Reserve at Jackson Hole

The Federal Reserve remains central to market sentiment this week as policymakers gather in Jackson Hole, Wyoming, for the annual economic policy symposium. Investors will watch closely for commentary on the trajectory of interest rates, particularly as inflation trends lower and growth expectations remain steady.

According to CME Group’s FedWatch tool, futures markets are pricing in nearly an 85% probability that the Fed will cut rates at its September meeting. While some investors are bracing for a cautious tone from central bank officials, the prevailing outlook suggests the Fed may be preparing to shift toward a more accommodative stance in the months ahead.

Earnings Season Winds Down with Retail in Focus

Beyond monetary policy, corporate earnings will remain a key driver this week as several major retailers report results. Home Depot, Lowe’s, Walmart, and Target are among the notable names set to release quarterly figures. Analysts expect these reports to provide valuable insight into consumer spending trends at a time when household budgets remain squeezed by higher borrowing costs.

The broader earnings season has been stronger than expected. Of the more than 92% of S&P 500 companies that have reported, nearly 82% have topped Wall Street estimates, according to data from FactSet. The performance underscores corporate resilience despite macroeconomic uncertainty and signals that U.S. businesses are adapting effectively to shifting market conditions.

Outlook for Investors

With equity benchmarks building on recent momentum, the market faces a critical juncture in the coming weeks. The Fed’s policy outlook, combined with the health of U.S. consumer spending, will likely determine whether the rally extends into the fall.

The recent outperformance of small-cap and consumer discretionary Stock Futures suggests that investors are looking past near-term headwinds and positioning for a stronger economic backdrop in late 2025. Still, concerns about inflation persistence, global trade dynamics, and the pace of monetary easing remain at the forefront of risk assessments.

For now, the prevailing tone in markets is constructive, buoyed by strong corporate earnings and growing confidence that the Federal Reserve is nearing a pivot toward rate cuts. If confirmed at Jackson Hole, that policy shift could provide further tailwinds for U.S. equities in the months ahead.