Dow futures are little changed after index posts best day since June 2023: Live updates

Dow futures are expected to rise on Wednesday after the 30-stock index posted its best day since June 2023.

Futures tied to the Dow Jones Industrial Average gained 0.03%. S&P 500 futures inched lower by 0.21%, while Nasdaq 100 futures ticked down by 0.41%.

In after-hours trading, Five Below lost 10% after announcing the departure of its chief executive officer Joel Anderson and the appointment of chief operating officer Kenneth Bull as its new interim president and CEO. J.B. Hunt Transportation Services dipped more than 2% after reporting worse-than-expected second-quarter results.

In Tuesday’s session, the Dow rallied more than 700 points and closed at a record, while also posting its best session since June 2023. The S&P 500 added 0.64%, while the tech-heavy Nasdaq Composite ended the day just 0.2% higher.

Small-cap stocks have also seen a resurgence since last week’s June consumer price index report, with some investors now rotating out of megacap technology and popular artificial intelligence leaders into small caps and cyclical stocks. On Tuesday, the Russell 2000 added 3.5%, notching its fifth straight day of gains. The small-cap index has jumped more than 10% this month.

“The Dow has spent most of the past two years lagging the S&P 500 index, but it has new wind in its sails this summer on the hopes that the market rally will broaden from a narrow set of technology companies into a broader array of companies throughout the economy,” said Chris Zaccarelli, chief investment officer of Independent Advisor Alliance.

This broadening market rally is underway as traders have become more optimistic on interest rate cuts, which should benefit small caps and companies with higher financing costs. Fed funds futures trading implies a 100% likelihood the Federal Reserve will lower rates in September, according to the CME FedWatch tool.

Looking ahead to Wednesday, United Airlines, Discover Financial Services, Johnson & Johnson and U.S. Bancorp are some of the names set to release quarterly earnings results.

On the economic front, the Fed’s Beige Book will also be released, as will housing starts and building permits data for June.