U.S. stock futures showed a positive trend on Monday as investors prepared for the Federal Reserve's final policy decision of the year later this week.
Nasdaq 100 futures rose approximately 0.3%, following a record high for the tech-heavy index.
Futures for the S&P 500 and Dow both increased by 0.1%, recovering slightly after a challenging week for these major indices.
Bitcoin reached a new all-time high, surpassing $105,000, driven by optimism surrounding a potential crypto-friendly administration under Donald Trump.
This surge was reflected in the pre-market trading of MicroStrategy, a software company known for its significant Bitcoin holdings, which saw its stock rise over 4% as it prepared to join the Nasdaq 100.
However, Bitcoin's price later eased back to around $104,000, indicating some volatility in the market.
The Federal Reserve's interest rate decision scheduled for Wednesday is a significant focus for Wall Street, with traders currently pricing in a 97% likelihood of a 25 basis point cut.
The bigger question looms over whether the Fed will adjust its "dot plot," which previously indicated four additional small cuts in 2025, amid ongoing concerns about persistent inflation and potential challenges from a Trump administration.
This week is pivotal not only for the Fed but also for broader economic indicators, with an update to the Personal Consumption Expenditures (PCE) index and a report on U.S. retail sales for November expected.
These data points will provide critical insights into consumer resilience and spending patterns, shaping future monetary policy.
The upcoming Fed decision is part of a busy week for central banks worldwide, with the Bank of Japan also set to announce its rate-setting decision.
Recent data from China revealed that retail sales fell short of expectations, contributing to a downturn in regional stock markets.
The Chinese government refrained from implementing anticipated stimulus measures over the weekend, raising concerns about the country's economic recovery.
Additionally, official figures indicated a continued decline in housing prices, although industrial production showed signs of growth, highlighting a mixed economic landscape.
On the corporate front, Super Micro Computer Inc. faced significant challenges as its shares plummeted by 14% in pre-market trading.
The server maker was removed from the Nasdaq 100 amid allegations of accounting malpractice, underscoring the volatility and risks present in the tech sector.
The interplay between corporate performance, economic indicators, and central bank decisions will be crucial in shaping market sentiment.
The upcoming Fed meeting, coupled with key economic data releases, is likely to influence trading strategies and investment decisions in the days ahead.
The convergence of traditional finance and digital assets continues to create a dynamic environment, where both sectors are increasingly intertwined and responsive to broader economic trends.