U.S. stock index futures were subdued Wednesday as skittish investors waited for the Federal Reserve to cut interest rates for the first time in more than four years, with most traders betting on a half-percentage-point reduction.

Borrowing costs have stayed at their highest levels in over two decades since July 2023, when the central bank last hiked interest rates by 25 basis points to between 5.25% and 5.50%.

At 04:44 a.m. ET, Dow E-minis were up 44 points, or 0.11%, S&P 500 E-minis were up 0.5 point, or 0.01%, and Nasdaq 100 E-minis were down 2.5 points, or 0.01%

Futures linked to the Russell 2000 index, tracking small caps which tend to fare better in a lower interest-rate environment, were also flat.

The benchmark S&P 500 and the blue-chip Dow both recovered from an early August rout to clinch intraday record highs in the previous session, after a batch of economic data hinted at a still-robust economy ahead of the Federal Reserve decision, expected at 2:00 p.m. ET.

However, uncertainty looms on the size of the rate cut. Following dovish commentary from present and former Fed officials, traders now see a 63% chance of a bigger 50-basis-point reduction, according to the CME Group's FedWatch tool.

Analysts, however, caution that an outsize move from the central bank could spook markets, which are already nervous about the overall health of the world's biggest economy.

Bets for a smaller 25-bps cut have now slipped to 37% from 86% a week ago. Investors will also be watching for comments from Fed Chair Jerome Powell at 2:30 p.m. ET to gauge the central bank's stance on the economy and prospects of further rate cuts this year.

"Powell would need to provide solid macro justifications for a half-point move to avoid sounding too sensitive to market rate expectations," analysts at ING Bank said.

"Incidentally, Powell would need to show the 50 bps cut isn't a 'panic' move. Failing to offer such reassurance can cause turmoil in equities."

Markets have rallied this year, with all three major indexes setting record highs on prospects of lower interest rates as inflation moderated and the jobs market showed gradual signs of cooling.

Heavyweight growth stocks were mixed in premarket trading. Apple fell 0.60%, Nvidia dipped 0.51%, while Alphabet and Microsoft inched up 0.15% and 0.31%, respectively.

Among top movers, Intuitive Machines jumped 42% after clinching a $4.8 billion navigation services contract from NASA.