U.S. index futures are down in premarket trading this Friday, following a strong rally the previous day, fueled by the Federal Reserve’s interest rate cut and encouraging unemployment data. With no major economic events on the calendar, traders expect light trading activity today.

As of 5:11 AM, Dow Jones futures (DOWI:DJI) fell 14 points, or 0.03%. S&P 500 futures lost 0.19%, and Nasdaq-100 futures dropped 0.29%. The 10-year Treasury yield stood at 3.707%.

In the commodities market, oil prices fell on Friday but are on track to close a second consecutive week of gains, driven by the U.S. rate cut and declining global inventories. Prices recovered after three-year lows, although demand remains a concern due to economic slowdown in China and Middle East tensions.

West Texas Intermediate crude for October fell 0.35%, to $71.70 per barrel, while Brent for November dropped 0.19%, to $74.74 per barrel.

The lack of rainfall in Western Australia is expected to negatively impact wheat production, lowering the estimate to 9.3 million tons, a 7% drop from the previous month. Reduced exports could exacerbate the already tight global supply, with grain prices rising.

Asia-Pacific markets continued higher on Friday, boosted by the U.S. rate cut, while the Bank of Japan kept rates steady.

Japan’s Nikkei 225 closed up 1.53%, finishing at 37,723.91, while the Topix rose 0.97%. Hong Kong’s Hang Seng gained 1.27% in the final hour of trading. China’s CSI 300 rose 0.16%, South Korea’s Kospi gained 0.49%, and Australia’s S&P/ASX 200 advanced 0.21%.

The Bank of Japan held interest rates steady at 0.25% and revised its consumption assessment, highlighting a moderate increase in private consumption despite inflation. Core inflation rose to 2.8% in August, marking the fourth consecutive month of acceleration. Japan’s annualized GDP growth was 2.9% between April and June, and real wages increased for two consecutive months in July.

As another rate hike is expected in December, economists were disappointed by Kazuo Ueda’s tone, after the decision to keep rates unchanged. Instead of taking an aggressive stance, Ueda indicated little urgency to raise rates, reducing expectations for a yen recovery and affecting its performance against other currencies. The yen depreciated as Ueda suggested that inflation risks linked to the weak yen are diminishing, allowing for a more cautious approach to monetary policy.

Tokyo Metro, the Tokyo subway operator, announced it would list its shares on the Tokyo Stock Exchange on October 23, forecasting a $2.25 billion IPO, the largest in Japan in six years. Additionally, Rigaku, a company specializing in X-ray and spectroscopy technologies, plans an IPO on October 25, potentially raising up to $888 million.

China decided to keep its benchmark interest rates unchanged, surprising the market, which had expected a move following the Federal Reserve’s rate cut. Despite this, analysts believe more stimulus is needed to support the economy. China’s one-year and five-year benchmark lending rates remain at 3.35% and 3.85%, respectively.

China also issued its third and likely final batch of fuel export quotas for 2024, keeping levels similar to the previous year. Seven refiners were allowed to export 8 million tons, totaling 41 million tons this year. This decision reflects Beijing’s desire to control production and encourage consolidation in the refining sector.

Economists polled by Reuters expect the Reserve Bank of Australia to keep its interest rate at 4.35% at Tuesday’s meeting and throughout the rest of the year, despite inflation at 3.5%. Most expect cuts early next year.

European markets are trading lower on Friday, reflecting the impact of central bank interest rate decisions. The automotive sector led the losses, with Mercedes (TG:MBG) shares falling 2.3% after citing weak demand in China. Burberry (LSE:BRBY) also declined, down 4.7%, after being downgraded from “Hold” to “Underperform” by Jefferies.

Despite this, UK retail sales rose 1% in August, beating expectations, while European consumer confidence data will be released later.

U.S. stocks soared on Thursday, driven by optimism after the Federal Reserve’s 50 basis point rate cut. The Dow Jones rose 1.26%, the S&P 500 gained 1.70%, and the Nasdaq surged 2.51%.

The Federal Reserve’s decision to cut rates by 50 basis points to the 4.75% to 5.00% range generated market optimism. Additionally, jobless claims unexpectedly fell to 219,000, a drop of 12,000, signaling a stronger economy.

BMO Capital Markets raised its target for the S&P 500 from 5,600 to 6,100 for 2024, citing market strength.

On the quarterly reports front, Tamboran Resources (NYSE:TBN) numbers are expected before the opening.