Dow futures exhibit a decline, suggesting a potential reversal from the gains recorded in the previous session. Analysts are meticulously examining the ramifications of a Federal Reserve interest rate cut and striving to discern the trajectory for borrowing costs moving forward. Cloud-computing giant Oracle experiences a decline in its stock price during extended hours trading, attributed to a less-than-optimistic outlook for the current quarter. In contrast, Photoshop-owner Adobe surpasses expectations with its annual forecast.

Dow futures indicated a downward trajectory on Thursday, as investors evaluated the implications of the Federal Reserve’s recent decision to reduce borrowing costs for the third time since September, alongside the earnings report from cloud leader Oracle. As of 02:04, the Dow futures contract experienced a decline of 213 points, representing a decrease of 0.4%. Meanwhile, S&P 500 futures saw a reduction of 59 points, equating to a 0.9% drop, and Nasdaq 100 futures fell by 308 points, which corresponds to a 1.2% decrease. The primary indices experienced an uptick in the previous session, supported by the Federal Reserve’s decision to reduce rates by 25 basis points. Additionally, Chair Jerome Powell conveyed a message during his post-meeting news conference that was more measured than many had expected. At the conclusion of trading, the benchmark S&P 500 experienced an increase of 0.67%, reaching a level of 6,886.68, approaching a record closing high achieved in late October. The blue-chip Dow Jones Industrial Average experienced an increase of 1.05%, reaching 48,057.75, while the Nasdaq Composite saw a modest gain of 0.33%, climbing to 23,654.16.

The U.S. dollar continued to experience downward pressure after reaching a seven-week low overnight, as Powell indicated that he does not consider a “rate hike is anyone’s base case” in the upcoming months. Interest rate futures indicated an expectation for additional rate reductions in 2026, which exerted downward pressure on the greenback. At 03:13, the U.S. dollar index, which monitors the currency relative to a selection of its international counterparts, experienced a decline of 0.1%, settling at 98.65. On Wednesday, the Federal Reserve reduced interest rates by a quarter-point, bringing them to a range of 3.50% to 3.75%. However, there were significant disagreements among central bank members regarding this decision. Policymakers had earlier implemented comparable reductions in borrowing costs during the months of September and October. The prospect of a further drawdown at the beginning of next year appears improbable, as many Federal Reserve officials are inclined to assess the trajectory of a softening labor market alongside “somewhat elevated” inflation levels. Economic projections suggest that the Fed anticipates U.S. growth to accelerate in 2026. These predictions highlight significant divergences in the outlook of rate-setters regarding the future path of interest rates, particularly as President Donald Trump embarks on a transformative agenda for global trade and the rise of artificial intelligence has catalyzed a notable increase in investment. Significant focus is currently directed towards Trump’s selection for the position to succeed Powell following the conclusion of his tenure at the Federal Reserve in May. The leading candidate appears to be White House economic adviser Kevin Hassett, prompting analysts to indicate that he may support the aggressive and swift rate cuts that the president has long advocated. “Current Fed members suggest just one further cut is their 2026 central projection, but with changes coming and the jobs market cooling, the risks are skewed towards them cutting by more,” analysts noted.

Oracle’s shares fell over 12% in after-hours trading following the cloud-computing company’s sales and profit forecast, which did not meet expectations. The Texas-based company indicated that expenditures would rise by $15 billion compared to previous forecasts, intensifying concerns that substantial investments in AI may not yield the anticipated immediate returns for investors. For the current quarter, adjusted profit is projected to be in the range of $1.64 to $1.68 per share, which falls short of analysts’ expectations of $1.72, as reported. Revenue for the period is projected to increase by 16% to 18%, which is below the anticipated growth rate of 19.4%. In Oracle’s recently concluded fiscal second-quarter, both revenue and adjusted operating income, as well as a metric related to forthcoming cloud contracts, fell short of expectations. As the results approached, apprehensions emerged regarding the company’s substantial, frequently debt-fueled, investments in AI. The concerns were sufficient to dampen a significant portion of the optimism generated by its recent impressive earnings report in September. Oracle’s stock price, which initially experienced a surge following those results, has since retreated.

In the interim, Adobe provided an annual revenue and profit forecast that surpassed expectations, indicating that the company may be capitalizing on efforts to monetize its AI-enhanced products. Full-year revenue is projected to range from $25.90 billion to $26.10 billion, surpassing the anticipated figure of $25.87 billion. Adjusted earnings are projected at $23.30 and $23.50 per share, exceeding the midpoint estimate of $23.34 per share. Adobe, a steadfast presence in the creative sector, has initiated a multi-year strategy to integrate AI into a broader range of its tools, aiming to assist users in efficiently producing images and videos. Adobe’s freemium products experienced a 35% increase in monthly active users compared to the previous year, surpassing 70 million, as reported by CFO Dan Durn to Reuters. However, the increasing competition for contracts, driven in part by the broad adoption of AI by enterprises, poses a risk to returns.

In a recent development that has captured the attention of both Hollywood and financial markets, President Trump asserted that CNN should be included in any transaction concerning the acquisition of its parent company, Warner Bros Discovery. During a discussion with reporters at the White House, Trump asserted that CNN, a longstanding focus of the president’s criticism, ought to alter its ownership irrespective of who acquires Warner. Trump stated, “It is imperative that CNN be sold.” The remarks follow the entertainment behemoth Paramount’s initiation of a $77.9 billion hostile takeover attempt for Warner, encompassing the conglomerate’s cable networks, including CNN. A prior agreement between Warner and Netflix, revealed earlier this month, will exclusively involve Warner’s studio and streaming offerings.