Uncertain Federal Reserve interest rate outlook, US stock futures steady; Walmart earnings report coming soon

Investing.com - On Wednesday evening Eastern Time in the United States, U.S. stock index futures were nearly unchanged, as the Federal Reserve’s January meeting minutes sent mixed signals on interest rates, intensifying market uncertainty about long-term monetary policy.

The market is currently focused on retail giant Walmart (NASDAQ:WMT) ahead of its upcoming earnings report, seeking more clues about the U.S. economy.

Concerns over escalating geopolitical tensions with Iran also exerted pressure, with reports indicating that despite ongoing dialogue between Tehran and Washington, U.S. military presence in the Middle East has increased.

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As of 8:00 p.m. Eastern Time (1:00 a.m. Beijing Time), S&P 500 futures slightly declined to 6,892.0 points. Nasdaq 100 futures fell nearly 0.1% to 24,942.75 points, while Dow futures declined 0.1% to 49,685.0 points.

Futures stabilized after major Wall Street stock indexes rose, mainly driven by a continued rebound in technology stocks, with data reflecting some resilience in the U.S. economy. However, cautious sentiment toward the Federal Reserve prevented the indices from reaching intraday highs.

Federal Reserve Minutes Show Disagreement Among Officials on Inflation and Rate Hikes

The January Federal Reserve meeting minutes show that policymakers unanimously supported keeping interest rates unchanged at 3.50% to 3.75%.

However, there was significant disagreement among policymakers about the next steps, with several members warning that inflation might take longer to fall below the Fed’s 2% annual target.

“Several” policymakers also indicated that if inflation remains above the target for an extended period, it may be necessary to raise rates further. This stance contrasts sharply with the market consensus that inflation and interest rates will decline further this year.

Artificial intelligence remains a major uncertainty for the Fed, with policymakers divided on whether this rapidly growing industry will push inflation higher or lower.

Walmart to Announce Q4 Earnings, Outlook in Focus

Walmart (NASDAQ:WMT) will release its fourth-quarter earnings on Thursday, with market attention centered on the company’s outlook for 2026—potentially providing more clues about U.S. consumer spending and economic health.

According to Investing.com, Walmart is expected to report earnings of $0.7269 per share and revenue of $190.4 billion.

As the world’s largest retailer by market value, Walmart is widely seen as a barometer of American consumers. As its Q4 earnings are released, increasing signs suggest that stubborn inflation is putting pressure on U.S. retail spending.

In addition to Walmart, U.S. trade data for December and weekly initial jobless claims will also be released on Thursday.

Wall Street Overcomes Rate Uncertainty, Tech Stocks Lead Gains

On Wednesday, Wall Street stock indexes rose, led by a rally in technology stocks, which further rebounded from recent declines.

However, the indexes retreated from intraday highs by the close, and tech stocks remained fragile amid growing concerns about AI’s impact on the sector.

Worries about artificial intelligence have been a primary driver of recent declines in tech stocks, especially in software and logistics sectors. Concerns over excessive AI-related spending have also pressured broader tech stocks, particularly companies involved in data centers.

The S&P 500 rose 0.6% to 6,881.32 points. The Nasdaq Composite increased 0.8% to 22,753.64 points, while the Dow Jones Industrial Average gained 0.3% to 49,662.66 points.

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