CaliToday (14/11/2025): Wall Street braces for another 'sea of red' after yesterday's worst sell-off in a month, as Fed data 'blindness' and sticky inflation fuel an exodus from Big Tech.
NEW YORK – U.S. stock futures plunged sharply in early Friday trading, signaling that Wall Street's newfound anxiety is far from over. The rout is set to extend Thursday's steep sell-off as investor faith in a December interest-rate cut from the Federal Reserve rapidly evaporates, putting immense pressure on riskier, high-growth assets.
Here’s a snapshot of the pre-market damage as of 6:00 AM ET:
Contracts on the tech-heavy Nasdaq 100 (NQ=F) tumbled approximately 1.5%.
S&P 500 futures (ES=F) dropped nearly 1%.
Dow Jones Industrial Average futures (YM=F) slid roughly 0.6%.
This points to another "sea of red" at the opening bell, piling onto the losses from Thursday's bruising session, which saw the major indexes log their steepest one-day declines in over a month.
Big Tech Leads the Exodus
The pain is once again concentrated in the market's biggest winners. Growing fears about artificial intelligence valuations and higher interest rates are driving an exodus from "hotly valued" sectors.
Tesla (TSLA): Shares fell another 4% in pre-market trading, set to break below the critical $400 level. This follows the stock's worst single-day performance since July.
Nvidia (NVDA): The AI bellwether, which also tanked on Thursday, moved 3% lower as investors rethink the high price of growth.
Fed Rate-Cut Hopes Collapse
The market's mood has soured dramatically as worries grow that the Federal Reserve will slow, or even halt, its pace of policy easing.
The catalyst is a one-two punch: an increasingly hawkish tone from Fed officials and a critical lack of new data.
1. The Hawkish Pivot: Traders, who just one month ago saw a December rate cut as a near-certainty, have been forced into a stunning reversal. Market-implied odds for a quarter-point cut next month have collapsed from about 95% a month ago to less than 50% today.
Minneapolis Fed President Neel Kashkari became the latest official to lose his appetite for rate cuts, flagging "resilience" in the U.S. economy and his continued concerns over inflation.
2. Data "Blindness": Complicating the Fed's decisions and destroying market certainty is the data blackout caused by the record six-week federal shutdown. Now that the government has reopened, policymakers admit they lack clear insight into the true state of price pressures or the jobs market. It remains unclear what data will be released and in what form, leaving both the Fed and investors flying blind.
White House Scrambles on Inflation
In a clear nod to these persistent price pressures, the Trump administration is reportedly preparing its own measures. President Trump is said to be readying substantial cuts to tariffs in an effort to bring down high food costs a major concern for voters in recent state and local elections.
The plan reportedly includes several new trade deals with Argentina, Brazil, and other Latin American countries, aimed specifically at making imports like bananas and coffee more affordable for American consumers.