Dow Jones futures fall as Fed decision and big tech earnings approach

• Rates are set to remain at 3.75% to 4.0%, with attention on Fed Chair Kevin Warsh's outlook.
• Alphabet and Microsoft report after Wednesday's close, giving Wall Street a measure of momentum in the AI trade.
• Tuesday's stock market advance was driven by technology shares, supported by Broadcom's $63B financing deal, Meta's offering and Oracle's partnership.

A 0.22% fall leaves Dow Jones futures trading near 52,460 during Wednesday's European session. By contrast, S&P 500 futures are up 0.08% at around 7,760, and Nasdaq 100 futures have added 0.45% to stand near 29,950.

Ahead of the Federal Reserve (Fed) policy announcement and closely watched earnings from megacap technology companies, US equity futures were mixed. Corporate performance is a particular focus: Alphabet and Microsoft are due to release results after Wednesday's market close. Investors will scrutinise the figures for evidence of the underlying strength and direction of the artificial intelligence trade.

A 90.6% probability of unchanged rates at this meeting is currently implied by the CME FedWatch tool, while pricing puts the likelihood of a December rate increase at 84.3%. The Federal Reserve is widely expected to leave its benchmark interest rate in the existing 3.75% to 4.0% target range, keeping monetary policy firmly in focus. Investors will also listen closely to Federal Reserve Chair Kevin Warsh's forthcoming press conference for nuances in the central bank's wider economic assessment.

Tuesday's regular session had ended higher as strength in technology shares supported the main indices, before giving way to the current cautious positioning. Gains of 0.6% for the S&P 500 and 1.18% for the Nasdaq Composite accompanied a modest 0.03% rise in the Dow Jones Industrial Average. Chipmakers provided the main impetus after Broadcom announced that a consortium of banks would supply $63 billion in financing associated with Anthropic's deployment of its technology. In other technology developments, strong demand left Meta's $25 billion share offering five times oversubscribed, while Oracle extended its strategic partnership with OpenAI.

Technology shares lead gains as US equities show resilience

Resilient US equities benefited from both economic figures and technology sentiment, according to Deutsche Bank analysts, who observe that “the strong data yesterday also added to the resilience of US equities, which were already advancing amidst a continuing buoyant tech mood.” Chipmakers headed the advance: the analysts describe “the Philly semiconductor index (+3.60%)” as recording “a big gain,” adding that “the Nasdaq (+1.18%) and the Mag-7 (+0.94%) also marched higher.” Highlighting “notable tech moves” in “CoreWeave (+7.94%), Nvidia (+0.90%), and Broadcom (+4.00%),” Deutsche Bank's assessment underlines the continuing prominence of AI and semiconductor shares in the latest market advance.