LDN - Business

Wall St. set to open lower ahead of Fed minutes

[October 08, 2015] By Abhiram Nandakumar

(Reuters) - Wall Street was set to open lower on Thursday ahead of the minutes of the Federal Reserve's September meeting that investors are counting on to provide insight into the Fed's thinking on interest rates.

A six-day rally in global stocks was checked on Thursday as weak trade from Germany and factory data out of Japan fed worries about slowing growth, a key reason the Fed did not raise interest rates in September.

U.S. stocks are likely to be on the defensive through Thursday till the Fed minutes are released said John Brady, senior vice president at R.J. O'Brien & Associates in Chicago.

"Stocks will continue to work off this oversold condition they had in late September. It will be the Fed minutes later in the day that will give us a sign one way or the other."

Investors will scrutinize the minutes of that meeting for details on the Fed's view on economic outlook and for clues on when the central bank will raise rates. The data is due at 2:00 p.m. ET (1800 GMT).

Investors are also bracing for quarterly results that will reveal how badly U.S. companies are being hit by slowing global growth.

S&P 500 companies are now expected to report a 4.4 percent fall in third-quarter profit, the biggest decline in six years, according to Thomson Reuters data.

U.S. jobless claims fell more than expected to a near 42-year low last week, providing a more upbeat view of the health of the labor market after Friday's weak monthly jobs report.

At 8:30 a.m. ET, S&P 500 e-minis were down 7.75 points, or 0.39 percent, with 204,586 contracts traded. Nasdaq 100 e-minis were down 17.25 points, or 0.4 percent, on volume of 35,557 contracts. Dow e-minis were down 61 points, or 0.36 percent, with 26,443 contracts changing hands.

U.S. stocks closed higher on Wednesday, with the S&P 500 touching it highest in three weeks, as healthcare and biotechs rebounded from a selloff the day earlier.

Crude oil prices were up 1 percent, on track for their best weekly gain since August, helped by a weaker dollar. The dollar fell on nervousness ahead of the Fed's minutes.

Shares of EMC rose 4 percent to $27.01 premarket after Reuters reported that Dell was in talks to buy the data storage company.

Fiat Chrysler rose 1.4 percent to $15.02 after the automaker struck a new deal with a workers union.

Domino's Pizza fell 3.7 percent to $104 after it reported lower-than expected results.

BioMed Realty rose 8.4 percent to $23.41 after Blackstone's $8-billion buyout offer.

Alcoa will report results after the close, considered the official start to the earnings season. Alcoa was down 0.64 percent at $10.87.

St. Louis Fed President James Bullard, Minneapolis Fed President Narayana Kocherlakota and San Francisco Fed President John Williams are scheduled to speak at separate events.

(Reporting by Abhiram Nandakumar in Bengaluru; Editing by Savio D'Souza)


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