After roaring almost 500 points higher on Wednesday, the Dow Jones Industrial Average is set for a softer start on Thursday, December 11, 2025, as U.S. stock futures edge lower in early premarket trading. A fresh Federal Reserve rate cut initially ignited a powerful risk rally, but disappointing earnings and heavier AI-related spending from Oracle have quickly cooled the mood overnight. [1]
Investors heading into the U.S. trading day now face a tricky combination: a Dow hovering just below record territory, renewed questions about an AI bubble, and key economic data on jobs and trade due within hours that could influence the Fed’s next move. [2]
Dow Jones Today at 5:00 a.m. EST: Futures Point to a Lower Open
Shortly before 5:00 a.m. EST, U.S. index futures were in the red, signaling a modest pullback after Wednesday’s post-Fed surge.
- Dow Jones Industrial Average futures were recently trading near 47,957, down about 150 points (-0.31%) as of 4:28 a.m. EST, suggesting the blue-chip index could give back part of yesterday’s nearly 500‑point gain at the open. [3]
- S&P 500 futures were off roughly 0.6–0.9%, while Nasdaq 100 futures were down about 0.8–1.2%, reflecting heavier selling pressure in technology shares. [4]
If these levels persist into the opening bell, the Dow would still start Thursday very close to its all-time highs, but with investors clearly more cautious than they were immediately after the Fed’s decision.
Recap: Dow Soars Nearly 500 Points After Fed’s Final Rate Cut of 2025
On Wednesday, the Dow Jones Industrial Average (DJIA) jumped 497.46 points, or 1.05%, to close at 48,057.75, marking the second-highest close in its history and leaving the index just shy of a fresh record. [5]
The broader market also rallied:
- The S&P 500 climbed 0.67% to 6,886.68, ending just a few points below its record closing high. [6]
- The Nasdaq Composite gained 0.33% to 23,654.16, while the small‑cap Russell 2000 rose about 1.3%, punching out a new record close as investors rotated into more economically sensitive names. [7]
The catalyst was the Federal Reserve’s third rate cut of 2025. Policymakers lowered the federal funds rate by 25 basis points to a range of 3.50%–3.75%, as widely expected. [8]
Key takeaways from the Fed meeting:
- The vote was unusually split, with three dissents, highlighting internal tensions over how aggressively to support a cooling labor market while inflation remains above the 2% target. [9]
- Chair Jerome Powell described the new range as near “neutral” and emphasized that a rate hike is not the Fed’s base case, but he stopped short of promising further cuts in the near term. [10]
- Updated projections show Fed officials expecting only one more quarter‑point cut in 2026, while futures markets still price in roughly two cuts, underscoring a gap between investor hopes and official guidance. [11]
For the Dow, the message was initially bullish: lower borrowing costs, a softer tone on future hikes, and an economy that the Fed still expects to grow at about 2.3% in 2026 all helped push the index toward record territory. [12]
Oracle Earnings Revive AI Bubble Jitters and Hit Nasdaq Futures
What changed between the closing bell and Thursday’s early hours was Oracle’s earnings report.
The cloud and database giant delivered a profit and revenue outlook that missed Wall Street estimates and simultaneously said it would increase capital spending by around $15 billion versus earlier plans to fund massive AI‑focused data center projects. [13]
The reaction was swift:
- Oracle shares plunged more than 11% in after-hours trading, erasing part of their prior Fed‑day gains. [14]
- The company’s results are viewed as an important barometer for AI infrastructure demand and profitability. The miss and heavy capex plans rekindled worries that AI spending is outpacing near‑term returns, a concern that has surfaced periodically throughout 2025 as valuations in AI‑linked names soared. [15]
Futures markets reflected the shift in mood:
- Overseas, S&P 500 futures fell about 0.9% and Nasdaq 100 futures dropped roughly 1.3% in Asia trade, with AI‑linked stocks in Japan and Europe underperforming. [16]
- By early U.S. premarket, futures losses moderated somewhat, but tech still led the downside, keeping Dow futures in negative territory as investors reassessed the durability of the post‑Fed rally. [17]
Analysts quoted by Reuters and other outlets framed Oracle’s report as a “reality check” for the AI trade: spending is immense, but the path from huge infrastructure outlays to profits is not as smooth as many bulls had hoped. [18]
Because the Dow is less tech‑heavy than the Nasdaq, it’s cushioned somewhat from the immediate blow, but AI‑related volatility is still rippling across the entire U.S. equity complex.
Key Economic Data Today: Jobless Claims and Trade Deficit
Macro data will take center stage later this morning and could quickly change the tone for the Dow and the broader market.
Weekly Initial Jobless Claims (8:30 a.m. EST)
According to the economic calendar, the U.S. initial jobless claims report for the week ended December 6 is due at 8:30 a.m. EST. Economists expect new claims to rise to around 220,000, up from 191,000 last week. [19]
Why it matters for the Dow:
- Claims remain low by historical standards, but any upward trend could confirm the Fed’s worries that the labor market is losing momentum. [20]
- A weaker‑than‑expected number (higher claims) might reinforce expectations for further easing in 2026, which could be supportive for equities over time—but it could also raise fears of a sharper slowdown.
- A stronger‑than‑expected read (lower claims) could push bond yields higher as investors question how many cuts the Fed will actually deliver, potentially pressuring rate‑sensitive Dow components.
U.S. Trade Deficit (8:30 a.m. EST)
The U.S. international trade balance is also slated for release at 8:30 a.m. EST. Market calendars point to a wider deficit, from roughly $59.6 billion to the low‑$60 billion range, reflecting softer global demand and ongoing trade friction. [21]
While the trade data typically has a smaller immediate impact on the Dow than jobs or inflation figures, it feeds into GDP estimates and can affect the outlook for multinational blue chips that dominate the index.
A Data‑Light but Data‑Important Phase
Because a long government shutdown delayed several major reports in October and November, the Fed is now steering policy with patchier data than usual, a point policymakers and strategists have repeatedly highlighted. [22]
That makes every incremental release—from weekly jobless claims to trade figures—more potent than usual for markets. A number that might have been shrugged off in a “normal” year could now swing expectations for 2026 rate cuts and, with them, the path of the Dow.
Global Market Reaction Overnight
The reverberations from the Fed’s cut and Oracle’s warning have played out across global markets and are feeding back into sentiment around the Dow today.
Asia: Tech‑Heavy Indices Under Pressure
- Japan’s Nikkei 225 fell nearly 0.9%, weighed down by a sharp drop in SoftBank, which slid around 7.5% amid renewed anxiety over AI‑linked investments. [23]
- A broad Asia‑Pacific index excluding Japan slipped about 0.5%, and Chinese benchmarks were mostly lower, though Hong Kong’s Hang Seng was close to flat. [24]
Oracle’s guidance was a common thread: its gloomy outlook and higher capex plans heightened fears that returns on AI infrastructure may lag the hype, prompting investors to trim exposure to richly valued tech stocks across the region. [25]
Europe: Fed Relief vs. Tech Drag
By early European trade on Thursday:
- The pan‑European STOXX 600 was down about 0.3%, with major indices in London and Paris also modestly lower. [26]
- European technology stocks fell roughly 0.9%, led by a 2.5% drop in SAP, which was hit by read‑across from Oracle’s disappointing earnings and revived anxiety over AI valuations. [27]
This weakness in European and Asian tech has helped pull U.S. futures lower, even as many investors still see the Fed’s tone as less hawkish than feared, a net positive for risk assets over a multi‑month horizon. [28]
What Strategists Are Saying About the Dow’s Outlook
Opinion is increasingly divided on what comes next for the Dow Jones as 2025 draws to a close.
Reasons Bulls Remain Confident
Analysts and wealth managers highlight several supportive factors:
- Near‑record levels and strong 2025 gains: The Dow is up in the low‑teens percentage range for the year and recently notched a record closing high in November, reflecting broad participation beyond just mega‑cap tech. [29]
- A Fed that is easing, but not panicking: Although policymakers signaled a pause, the policy rate is lower than it was a few months ago, and markets still expect additional cuts in 2026 if growth slows. [30]
- Improving fiscal optics: The U.S. budget deficit for November came in at $173 billion, well below economists’ expectations of about $205 billion, helping to calm some near‑term worries about runaway borrowing and supporting Treasurys. [31]
Commentary from investment firms’ December outlooks notes that equity markets entered the month already buoyed by prior AI‑driven gains and optimism about a December Fed cut, and that many investors are still positioning for a traditional “Santa Claus rally” into year‑end. [32]
Reasons for Caution
At the same time, strategists stress that the backdrop is far from risk‑free:
- AI profit doubts: Oracle’s results have become a focal point for fears that AI infrastructure spending could be overextended, with profitability lagging. If those worries spread to other AI bellwethers, they could weigh on sentiment for months. [33]
- Fed uncertainty and leadership change: Reuters analysis underscores that investors now face a more opaque policy path, exacerbated by delayed economic data and an impending change at the top of the Fed next year. [34]
- Global growth and political risk: The end of the lengthy government shutdown, ongoing trade tensions, and a coming U.S. election cycle all add layers of unpredictability that could spur bouts of volatility in the Dow. [35]
Taken together, the picture that emerges is one of a market near its highs but navigating a narrower path, where good news on growth must walk a tightrope with persistent inflation and late‑cycle AI exuberance.
What to Watch for the Dow Jones Today
For traders and longer‑term investors alike, several catalysts will shape how the Dow trades through the rest of the session:
- 8:30 a.m. EST Data Dump
- AI and Tech Sentiment
- Follow‑through moves in Oracle and other AI‑linked names will be crucial, even if they’re not all part of the Dow, because they heavily influence overall risk appetite and Nasdaq‑led momentum. [38]
- Treasury Yields and the U.S. Dollar
- Ten‑year Treasury yields slipped to around 4.13% after the Fed cut and its plan to buy short‑term Treasuries, easing some pressure on equity valuations. Any rebound in yields could quickly pressure rate‑sensitive Dow components. [39]
- Corporate Earnings: Broadcom, Costco, Lululemon
- Tonight’s results from Broadcom, Costco and Lululemon will offer further clues about consumer health, enterprise tech spending, and the strength of AI‑related chip demand—factors that can reshape expectations for 2026 earnings and the Dow’s trajectory. [40]
Bottom Line: A Softer Open for a Still‑Strong Dow
As of around 5:00 a.m. EST, Dow futures are pointing to a modestly lower open, trimming but not erasing Wednesday’s powerful Fed‑driven rally. [41]
The index remains within touching distance of record highs, but markets are now grappling with:
- Fresh doubts about the profitability of massive AI investments,
- A Fed that has cut rates but signaled a pause amid patchy economic data, and
- Upcoming jobless claims and trade numbers that could either validate or challenge the current optimism. [42]
For now, the message from futures is clear: Wall Street is still optimistic—but no longer on autopilot.
References
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