US stock futures were mostly flat on Tuesday as Wall Street prepared for the Federal Reserve’s final policy meeting of the year. With many investors expecting an interest-rate cut this week, the market’s attention is shifting toward what the Fed might signal about rate moves in 2026.

Futures Hold Steady After Monday’s Losses

Contracts tied to the Dow Jones Industrial Average, S&P 500, and the Nasdaq 100 hovered near unchanged levels in early trading. This comes after modest declines across major indexes on Monday.

Even with the slow start, one notable mover was Nvidia, whose shares gained up to 2%. The boost followed President Trump’s approval allowing the company to resume limited shipments of its H200 AI chips to China, a key development for the chipmaker.

All Eyes on the Federal Reserve

The Federal Reserve begins its two-day meeting on Tuesday, with the policy decision scheduled for Wednesday. Markets are largely convinced the Fed will cut rates by 0.25%, matching rate reductions seen in September and October. Current projections show 89% odds of another cut.

Because the rate cut is mostly expected, investors are now watching for any hints about the Fed’s outlook for 2026. However, the path ahead remains unclear. White House economic adviser Kevin Hassett, seen as a leading candidate for the next Fed chair, warned that outlining long-term plans would be “irresponsible” given current economic uncertainties. Analysts have labeled the Fed’s recent stance a “hawkish cut” easing policy while maintaining a cautious tone.

Treasury Yields Ease After Hitting Two-Month Highs

The 10-year Treasury yield climbed to its highest level in more than two months on Monday. By Tuesday, yields pulled back slightly, moving in line with the broader bond market. Rising yields often signal concerns about inflation or future rate expectations, so investors are watching bond movements closely.

Labor Market Data Arrives Before the Decision

Before the Fed announces its decision, policymakers and traders will get one more look at the job market. The delayed JOLTS report for October which includes job openings, quit rates, and layoffs is set to be released on Tuesday. Labor conditions will play a big role in shaping the Fed’s tone for next year.

Major Corporate Earnings Also in Focus

Alongside the Fed meeting, several major companies are set to report earnings this week. Updates from Oracle, Broadcom, Costco, and Lululemon may provide fresh insight into:

• AI-driven enterprise spending
• Consumer demand heading into the holiday season
• Retail trends among major US brands

These results could add another layer of direction for the market during an already significant week.

Disclaimer

This article is for informational and educational purposes only. It is not financial advice. Always do your own research or consult a licensed financial professional before making investment decisions.