Wall Street Poised for Strong Open as Robust Jobs Data Dents Fed Cut Bets

U.S. stock futures pointed to a solid start on Wednesday after stronger-than-expected employment data signaled resilience in the world’s largest economy, prompting investors to reassess the outlook for Federal Reserve interest rate cuts.

Nonfarm payrolls rose by 130,000 in January, comfortably beating economists’ expectations for a 70,000 increase, while the unemployment rate edged down to 4.3%, compared with forecasts of 4.4%. The data reinforced the view that the U.S. labor market remains stable despite signs of slowing momentum elsewhere in the economy.

The upbeat jobs report tempered expectations for near-term monetary easing. Following weaker-than-expected retail sales data in December, market pricing had briefly lifted the probability of an April rate cut to 35.5% from 32.2%, according to CME Group’s FedWatch tool. That optimism faded after the jobs figures, with traders now fully pricing in the first 25-basis-point rate cut in July. Expectations for a second cut of similar size in 2026 eased slightly, according to LSEG data.

Attention now turns to the U.S. inflation report due on Friday, which could further reshape expectations for the Fed’s policy path.

At 08:43 a.m. ET, Dow Jones E-mini futures were up 203 points, or 0.4%, S&P 500 E-minis gained 26.5 points, or 0.38%, and Nasdaq 100 E-minis rose 107.75 points, or 0.43%.

Corporate earnings continued to drive individual stock moves. Cloudflare shares surged 13.8% after the cloud and network security firm delivered stronger-than-expected guidance for annual and first-quarter revenue. In contrast, Robinhood fell 9.6% after the online brokerage reported fourth-quarter revenue that missed Wall Street estimates.

Healthcare stocks were also under pressure, with Humana sliding 6.5% after forecasting 2026 profit below analysts’ expectations. U.S.-listed shares of Shopify jumped 11.3% after the e-commerce platform projected first-quarter revenue above consensus estimates.

Elsewhere, Kraft Heinz dropped 7.4% after the company said it had paused work on plans to split the business into two entities.

In the previous session, the S&P 500 and Nasdaq closed lower, while the Dow Jones Industrial Average notched its third consecutive record close. The broader benchmark, however, remains within striking distance of its late-January all-time high.

AI-driven disruption continued to weigh on sentiment in certain sectors, with investors quick to penalize companies perceived to be vulnerable. After software stocks sold off sharply last week, brokerage shares came under pressure on Tuesday amid concerns sparked by startup Altruist’s AI-powered tax-planning tools.

Among other notable movers, Moderna shares sank 10.5% after the U.S. Food and Drug Administration opted not to review the drugmaker’s application for approval of its influenza vaccine. Lyft plunged 15.7% after the ride-hailing firm issued a weaker-than-expected profit outlook and reported annual ride volumes that fell short of forecasts.

Overall, markets opened the day balancing signs of economic resilience against lingering uncertainty around inflation, monetary policy, and the pace of technological disruption across key industries.