U.S. stock futures hovered near the flatline Thursday night after the S&P 500 and Nasdaq Composite hit records in a post-election rally, as investors assessed the Federal Reserve's latest interest rate cut.

Navigating the Shifting Landscape: Investors Brace for Potential Inflation Risks

Postelection Surge Fuels Market Optimism

The market rally that began on Wednesday following President-elect Donald Trump's victory continued on Thursday, with the Dow and S&P 500 reaching their best days since November 2022. The S&P 500 gained 0.7% to close at a new record, while the tech-heavy Nasdaq jumped 1.5% and ended the session above 19,000 for the first time. The 30-stock Dow, however, was marginally lower.Investors generally view a Republican-controlled government as more favorable, with expectations of deregulation, potential for more mergers and acquisitions, and proposed tax cuts. However, concerns over the large federal deficit and increased tariffs have also sparked worries about an uptick in inflation.

The Fed's Balancing Act: Weighing Growth and Inflation Risks

The Federal Reserve's decision to lower interest rates by a quarter point, in line with traders' expectations, was a key focus for investors. Fed Chair Jerome Powell noted that he is "feeling good" about the economy during a press conference.However, the path of future Fed cuts has become less clear in the wake of the election. Scott Helfstein, head of investment strategy at Global X ETFs, said, "The market is signaling that a Trump administration would be good for growth and risk assets, but the combination of faster growth with new tariffs would be inflationary."This delicate balance between growth and inflation could pose challenges for the Fed as it seeks to maintain price stability and maximum employment. Helfstein added, "While the Fed feels the risks are balanced between stable prices and maximum employment, this could shift quickly, increasing the risk to reaccelerating inflation."

Sector Spotlight: Stocks Making Waves After Hours

In extended trading, several companies made headlines with their financial results and guidance:Airbnb saw its shares slip nearly 3% after the online homestays company reported third-quarter earnings that fell short of the consensus forecast by one cent per share. However, its quarterly revenue of $3.73 billion slightly exceeded analysts' estimates.Akamai Technologies, a cloud computing company, saw its shares slide 6% as it issued disappointing full-year guidance. Akamai said its adjusted earnings for the period will range between $6.31 and $6.38 per share on revenue of $3.966 billion to $3.991 billion, which fell short of analysts' expectations.Block, the fintech firm, also saw its shares dip 2% after reporting a third-quarter revenue miss. The company posted sales of $5.98 billion, while analysts had anticipated $6.24 billion. On the other hand, Block's adjusted earnings of 88 cents per share beat analysts' estimates by one cent.These post-market moves highlight the ongoing volatility and the need for investors to closely monitor the performance of individual companies, even as the broader market continues to navigate the shifting landscape.