US stock futures faltered on Wednesday as investors awaited notes from the latest Federal Reserve policy meeting for clues as to how officials view inflation and the pace of the economic recovery.
Futures tied to the S&P 500 index and the Dow Jones Industrial Average have staggered between gains and losses. Technology-heavy Nasdaq-100 futures have also been relatively flat. On Tuesday, the indexes pulled back slightly after closing at record highs early in the week.
Signs that the economy is recovering from the coronavirus-induced slump has bolstered investors and helped drive major indices to unprecedented levels this week. The rapidly advancing roll-out of vaccinations, combined with both financial and fiscal support, is contributing to the recovery of the labor market and the manufacturing sector. Money managers are betting that more of the economy will soon return to normal and boost travel and leisure businesses.
“We expected the data to improve around this time, and the first signs are that the recovery is absolutely on track,” said Hugh Gimber, global market strategist at JP Morgan Asset Management. “This is the period when the forecast of a strong growth recovery is more like the fact of a strong growth recovery.”
Some investors remain nervous that the easing of restrictions, coupled with pent-up consumer demand, could drive up inflation and prompt the Fed to raise interest rates earlier than expected.