Stocks Gain as Fed Delivers Quarter-Point Cut, Signals More Easing – Asia Market Wrap

US and European stock-index futures advanced, signaling renewed sentiment after the Federal Reserve’s interest-rate cut, even as questions lingered over the pace of future policy easing.

Contracts for the S&P 500 advanced 0.5% while those for the Nasdaq 100 gained 0.7%, after the underlying benchmarks posted minor declines following the Fed’s decision. Europe was also set for a stronger open with equities in Japan and China also climbing. Treasuries recouped some of their losses, while a gauge of the dollar rose for a second day as Fed Chair Jerome Powell termed the move a “risk-management cut.”

New Zealand’s bonds gained and the currency fell after softer economic data fueled speculation of an outsized rate cut.

An index of global stocks climbed to a record high this week as investors priced in a 25-basis-point cut ahead of the Fed meeting. While the central bank followed through with a cut, officials stressed future policy will be decided “meeting by meeting” and warned “there’s no risk-free path.” Even so, policymakers now see two additional quarter-point cuts this year, one more than was projected in June.

The Fed cut its benchmark interest rate by a quarter percentage point and penciled in two more reductions this year following months of intense pressure from the White House to slash borrowing costs. The Federal Open Market Committee voted 11-1 to lower the target range for the federal funds rate to a range of 4% to 4.25%.

The lone dissent came from Fed Governor Stephen Miran, a close ally of Donald Trump who favored a larger reduction. Governors Christopher Waller and Michelle Bowman, who in July dissented in favor of a rate cut, supported this week’s move.