U.S. stock futures drop as Irma heads toward Florida

[September 08, 2017]  By Sruthi Shankar

(Reuters) - U.S. stock index futures were lower on Friday as Hurricane Irma bore down on Florida even as Texas struggles with the devastation caused by Hurricane Harvey.

Irma was about 495 miles southeast of Miami, Florida, early in the day, having lashed the Caribbean with destructive winds and torrential rain that left 14 dead.

The hurricane, the strongest ever recorded in the Atlantic Ocean, comes on heels of Harvey, which shut a quarter of U.S. refineries and 8 percent of U.S. oil production.

Many companies had to adjust their financial expectations in the wake of Harvey's destruction, while jobless claims spiked to a two-year high last week, despite underlying strength in the labor market.

Economists said Harvey could weigh on U.S. economic growth for the third quarter, though they did not expect this to delay the U.S. Federal Reserve announcing at its meeting this month a plan to start trimming its $4.2 trillion debt portfolio.

However traders have sharply reduced the odds for another interest rate hike this year. The chances of a December move are at 26.4 percent, compared with 42 percent a week ago, according to the CME Group's FedWatch tool.

New York Fed President William Dudley on Thursday toned down his hawkish view, saying rates should continue to be raised gradually given that low inflation should rebound.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 29, 2016. REUTERS/Brendan McDermid

Philadelphia Fed President Patrick Harker, a rate-setting committee voting member, is to speak at 8:45 a.m. ET (1245 GMT).

Wall Street has been choppy of late as investors also digested an influx an information from Washington and on economic data as well as worries related to North Korea.

U.S. stocks ended little changed on Thursday as gains in healthcare shares were offset by a slump in media stocks after negative business updates from Disney and Comcast.

Among stocks, American Outdoor <AOBC.O> plunged nearly 20 percent in premarket trading after the gun maker's profit and revenue missed estimates.

Equifax <EFX.N> sank about 15 percent after the consumer credit scores provider said personal details of as many as 143 million U.S. consumers were hacked.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Savio D'Souza)

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