Markets on Wall Street were positioned to open at record highs Thursday after the Federal Reserve issued a bigger-than-usual interest rate cut intended to fortify a cooling labor market and prevent a recession.

The S&P 500 is hovering just below record territory, driven by a revived rally as bets have grown that the Federal Reserve will cut interest rates by half a percentage point.

U.S. stocks shot higher on Wednesday after the Federal Reserve cut interest rates by 50 basis points, the high side of estimates for its first cut in more than four years. Citing a "greater confidence" that inflation is moving towards the central bank's 2% target,