On Wednesday, US stocks found themselves paused near record highs as investors awaited a crucial reading on the Federal Reserve's preferred inflation gauge. This awaited data was expected to offer valuable clues regarding the path of interest rates. S&P 500 futures (ES=F) and Dow Jones Industrial Average futures (YM=F) remained relatively unchanged, having recently reached fresh all-time highs. However, contracts on the tech-heavy Nasdaq 100 (NQ=F) experienced a slight decline of 0.3%.

Thanksgiving Holiday Impact and Fed's Resurgence

During the wind-down to the Thanksgiving holiday, market sentiment was somewhat muted. Markets will be closed on Thursday and close early on Friday. Despite this, the Fed has once again taken the forefront, after being overshadowed by discussions about the impact of Donald Trump's tariff plans and cabinet choices. The October print of the Fed's preferred inflation gauge, the Personal Consumption Expenditures index, is scheduled for release on Wednesday morning. The focus now is on whether inflation has stalled, as some officials suggest, and the minutes from the Fed's last meeting hinted at a cautious stance on interest-rate cuts.Economists anticipate that the annual "core" PCE, which excludes food and energy, will show a growth of 2.8% in October, up from the 2.7% seen in September. A print in line with these expectations is likely to have an impact on bets for a rate cut in December. Currently, traders estimate a roughly 34% chance that the Fed will hold rates steady at that meeting, an increase from approximately 24% a month earlier, according to the CME FedWatch Tool.