Microsoft brightens Wall Street mood as rate cut hopes rise

US stock futures inched higher today as strong results for Microsoft’s cloud business fed into a bullish mood following signs from New York Fed President John Williams that the US central bank was set to cut interest rates this month. — Reuters pic
US stock futures inched higher today as strong results for Microsoft’s cloud business fed into a bullish mood following signs from New York Fed President John Williams that the US central bank was set to cut interest rates this month. — Reuters pic

NEW YORK, July 19 — US stock futures inched higher today as strong results for Microsoft’s cloud business fed into a bullish mood following signs from New York Fed President John Williams that the US central bank was set to cut interest rates this month.

Microsoft Corp, how America’s most valuable company, gained 3.5 per cent premarket, after it topped analysts’ estimates at the end of a week of mixed corporate results in the United States and Europe.

Williams’ comments that the Fed cannot wait for economic disaster to unfold on Thursday afternoon were behind the previous session’s positive close and they helped drive a raft of market moves on Friday.

Traders raised bets for a larger, half-percentage point cut in rates at the July 30-31 policy meeting to 46 per cent, from a 23 per cent chance a week ago, according to CME Group’s FedWatch programme.

At 6.54am ET, Dow e-minis were up 36 points, or 0.13 per cent. S&P 500 e-minis were up 1 point, or 0.03 per cent and Nasdaq 100 e-minis were up 9.5 points, or 0.12 per cent.

The main indexes have eased off all-time highs hit at the start of this week as some of the first batches of second quarter earnings releases pointed to a slowdown in growth under the shadow of US-China trade talks.

Boeing Co rose 1.7 per cent after disclosing it would take a US$4.9 billion (RM20.1 billion) after-tax hit in the second quarter on estimated disruptions from the grounding of its 737 MAX passenger jets.

Morgan Stanley analyst Rajeev Lalwani said that was a sign that investors were comfortable with the size of the charge and Boeing’s production plans ahead of its results next week.

Shares of the world’s largest oilfield services provider Schlumberger NV also rose 1 per cent as it announced better-than-expected revenue numbers and named company insider Olivier Le Peuch as new Chief Executive Officer.

American Express Co had gained 1.2 per cent ahead of its own results release. — Reuters