What’s Driving the Markets Today

Futures on major U.S. indices are slightly higher as investors focus on a series of tech company earnings reports and a Federal Reserve policy announcement. The U.S. central bank kept interest rates unchanged, highlighting the strength of the American economy, while Meta and Microsoft announced plans to continue major investments in artificial intelligence. Tesla reported it will invest in Elon Musk’s private AI project, and gold hit a new record.

1. Futures on the Rise

Futures on major U.S. indices moved slightly higher on Thursday as investors digested the Federal Reserve’s interest rate decision and a string of reports from major tech companies.

As of 03:02 ET (08:02 GMT), the Dow futures were nearly flat, S&P 500 futures rose 13 points or 0.2%, and Nasdaq 100 futures jumped 85 points or 0.3%.

On Wednesday, the S&P 500 benchmark crossed the 7,000-point mark for the first time, supported by optimism around artificial intelligence and expectations for future rate cuts by the Federal Reserve.

“Analysis shows the main focus was on technology, as companies in the sector almost all reported solid results and provided favorable guidance,” analysts at Vital Knowledge commented.

Supported by relative economic resilience amid geopolitical and trade uncertainty, the S&P 500 has risen roughly 1,000 points since November 2024.

2. Fed Holds Rates Steady

The Federal Reserve left interest rates unchanged in the 3.5%–3.75% range, as expected, highlighting signs of stability in the economy and a stabilized labor market.

Most of the 12 members of the rate-setting committee preferred to maintain current levels, though Stephen Muir and Christopher Waller supported a 0.25-point cut.

Former President Trump had long pushed for aggressive rate cuts to stimulate the economy, putting current Fed Chair Jerome Powell under pressure. Earlier this month, the Department of Justice opened an investigation into Powell, raising concerns about political influence over Fed independence.

In the post-decision press conference, Powell focused on the strength of the U.S. economy and predicted that the effects of Trump’s broad tariffs on inflation could soon dissipate.

Analysts at ING noted that the Fed’s more optimistic assessment suggests that last year’s policy easing cycle with multiple rate cuts is “near its end.”

3. Meta and Microsoft Earnings

Large AI investments remained a key theme in Meta and Microsoft’s Wednesday reports, with both companies reaffirming their ambitions in the sector.

The AI race has led to massive spending on infrastructure and equipment such as data centers and chips needed for advanced AI models. However, analysts warn that companies will be under pressure to demonstrate returns on these investments.

Meta announced that its capital expenditures would reach $135 billion for the year, nearly doubling the 2025 figure, alongside record fourth-quarter sales.

Microsoft shares, however, fell after the company reported higher-than-expected AI expenses and a slight slowdown in Azure growth.

After market close, investors will also be able to review Apple’s earnings report.

4. Tesla Investment in xAI

Tesla reported fourth-quarter results above expectations, signaling a pivot toward AI despite pressure on its automotive business.

Tesla shares rose 2.7% in the afternoon after the company announced a $2 billion investment in xAI — Elon Musk’s private AI project.

In 2025, Tesla defined itself as a “physical AI company,” shifting focus from hardware to integrating digital intelligence with physical products.

Vehicle sales fell 11% year-on-year, but the energy division reached a record 14.2 GWh.

5. Gold Continues Its Ascent

Gold prices reached a record high near $5,600 per ounce on Thursday following news of a potential Trump action against Iran.

Silver also hit a peak above $119/ounce, benefiting from demand for safe-haven assets.

The record gains in metals continue, supported by a weak dollar and global geopolitical tensions, with copper also reaching historic highs.