Wall St futures rise as Fed rate hike lifts long-standing overhang

U.S. stock index futures surged on Thursday after the Federal Reserve raised interest rates, reaffirming its focus on taming inflation and removing a long-standing source of market anxiety.

With the rate hike behind them, investors returned to their favorite themes. Tech shares gained, with Alphabet and Meta rising more than 1% each before the bell.

The policy decision will be crucial in determining investor sentiment in the second half of September, historically a weak month for equities. So far this month, the benchmark S&P 500 has lost 1.7%.

At 4:45 a.m. ET, Dow E-minis were up 340 points, or 0.66%, S&P 500 E-minis rose 56.25 points, or 0.74%, and Nasdaq 100 E-minis gained 277.75 points, or 0.96%.

Meanwhile, oil prices dropped for a second consecutive day, with Brent crude futures down over 1% to $104.43. U.S. West Texas Intermediate crude futures also fell 1% to $101.35.

Shares of neocloud firms rose premarket. CoreWeave, Nebius and IREN gained 6%, 9% and 5%, respectively.

Fluence Energy tumbled 18% after it lowered its revenue forecast for fiscal year 2026.

The central bank also flagged that more hikes may be needed in coming months to control price pressures. This could lead to volatility in the weeks ahead.

Traders see a 51% chance of another increase when the central bankers meet next in October, compared with nearly 44% a day ago, according to the CME FedWatch tool.

"The history is clear that once the Fed begins raising rates, they do it multiple times; but the pattern is less clear about whether they will raise rates at consecutive meetings or leave rates unchanged at some of the meetings in between," Zaccarelli said.