NEW YORK (CNNfn) - U.S. stocks are poised to beat a hasty retreat Thursday morning, as investors step back from record gains inspired by a surprise cut in interest rates by the Federal Reserve.
While not an unusual reaction to a day of such sharp advances, the expected sell-off calls into question whether the market will eventually continue to rally or revert to its recent gloominess, which was powered by corporate result warnings in a slowing economy.
While pleased with the rate cut, done to help save the economy from a profit-sapping slowdown, experts note that the move does not erase the facts that manufacturing has slowed, companies have reduced capital spending and consumers have reined in their buying plans.
The  Nasdaq 100 futures fell 41.50 points to 2,488 in early trading. That put the futures 70.28 points below fair value, a benchmark set daily by traders based on future contracts and their underlying stocks, meaning traders expect a lower open for the Nasdaq market.
S&P futures, the most widely watched futures contract, lost 2.20 points to 1,357 on the Globex trading system. That left futures 3.16 points below fair value, suggesting a lower open for the S&P 500 index. With each S&P futures point seen as equivalent to eight points of Dow Jones industrial average movement, the early loss indicated a 25-point drop for the blue chip measure.
On Wednesday, U.S. stocks finished sharply higher after the surprise Federal Reserve interest rate cut.
 The Nasdaq composite index skyrocketed 324.83 points, a one-day record 14 percent gain, to close at 2,616.69. The rally came just one day after concerns of a weakening economy sent the index down 7.2 percent.
The Dow climbed 299.60 points, or 2.8 percent, to close at 10,945.75, while the S&P 500, a broad measure of the nation's largest stocks, soared 64.29 points, or 5 percent, to 1,347.56.
Experts suggested that the Federal Reserve retained its bias toward more rate cuts, which could further stimulate stocks.
"(The cut is) the beginning of several shots in the arm," Robert Stovall, market strategist for Prudential Securities, told CNNfn's Ahead of the Curve. "I think the Fed acted early in the new year so to give themselves the opportunity in the end of the month to cut again, if things don't kick in as they like." (465K WAV) (465K AIFF)
In Asia Thursday, most markets rose in reaction to the gains in the U.S. -- except in Tokyo, where domestic concerns outweighed the external factors. In morning trading in Europe, stocks rose, led by recently beleaguered technology stocks.
In the Treasury market, which was sharply lower after the Fed action Wednesday, the 30-year bond rebounded 18/32 of a point in price in early trading. That sent its yield, which moves in the opposite direction, down to 5.45 percent from 5.48 percent in trading late Wednesday. The 10-year note gained 22/32 of a point, lowering its yield to 5.06 percent from 5.14 percent.
In the currency market, the dollar weakened versus the euro but gained against the yen in early trading. The euro rose to 94.70 cents from 92.75 cents in late trading Wednesday, while the dollar rose to 114.40 yen from 113.70 yen.
Oil prices fell in London trading Thursday. The price for Brent crude for March delivery fell 25 cents to $24.71 a barrel.
In company news, Inktomi (INKT: Research, Estimates), whose software helps manage the flow of data over the Internet, warned late Wednesday that its fiscal first-quarter revenue and earnings will come in below its previous expectations. The stock lost 23 percent in Wednesday's after hours trade to $14.25, after ending the regular session at $18.50, up $3.94.
BMC Software (BMCS: Research, Estimates) said it expects earnings in the range of 20 to 22 cents a share, greater than analysts' forecasts of 16 cents a share. The Houston-based company's stock jumped 32 percent in after-hours trade on Wednesday to $20.70, after closing he regular session at $15.63, up $2.
Web auction company eBay (EBAY: Research, Estimates) said its site was back in business early Thursday after being down for nearly 11 hours due to primary and back-up system failures. The company, whose shares closed up $9.17 at $39.36 in Wednesday trading, said it expects to incur no material financial impact as a result.
Federal regulators are taking a tough look at News Corp.'s (NWS: Research, Estimates) planned acquisition of Chris-Craft Industries' 10 television stations, and have voiced concern that the deal violate laws limiting foreign ownership of TV stations, according to the Washington Post. American depository receipts of the Australia-based company closed Wednesday at $35.81.
Investors got a further glimpse Thursday into how retailers performed during the just-concluded holiday season. Wal-Mart Stores (WMT: Research, Estimates), the world's largest retailer, showed a measly 0.3 percent gain at stores open a year or more -- a low figure for the discount chain. Wal-Mart closed Wednesday at $58.44, up $4.56.
Home furnishings retailer Pier 1 Imports (PIR: Research, Estimates) said its same-store sales for December were flat due to difficult retail conditions. Pier 1 rose 25 cents to $9.75 Wednesday.
Clothier The Limited (LTD: Research, Estimates) said its December sales were flat, and warned that fourth quarter profits would fall short of expectations. Its shares ended Wednesday at $17.94, up $1.50.
In economic data being released Thursday, the Labor Department reports initial jobless claims for the final full week of 2000, and the Department of Commerce delivers its figures on factory orders for November. 
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