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Fears of aggressive interest rate hikes by the Federal Reserve
have returned to the forefront after a report on Wednesday
showed strong U.S. labor demand.
Rate-sensitive growth stocks fell as the yields on the 10-year
Treasury note rose for the second day. Twitter Inc, Nvidia Corp
and Microsoft Corp were down between 0.7% to 1.2% in premarket
trading.
Tesla Inc slipped 1.1% after Apollo Global Management Inc and
Sixth Street Partners, which had been looking to provide
financing for Musk's $44 billion Twitter deal, are no longer in
talks with the billionaire.
Meanwhile, oil prices held near three-week highs after the OPEC+
group of nations' largest supply cut since 2020 ahead of
European Union embargoes on Russian energy is set to tighten
global oil supply.
This comes a day after data showed increased monthly hiring by
private employers in America and a rise in ISM's services
industry employment gauge, suggesting the Fed will keep interest
rates higher for longer.
Money markets are pricing in a more than 80% chance of a fourth
straight 75-basis-point rate hike at the upcoming Fed meet on
November 1-2.
After Fed's San Francisco President Mary Daly on Wednesday
underscored the central bank's commitment to curb inflation with
more interest rate hikes, other officials including Cleveland
President Loretta Mester, Fed Board Governor Lisa Cook, Board
Governor Christopher Waller and Chicago President Charles Evans
will be on the watch-list.
An initial jobless report is due at 8:30 a.m. ET, where in
203,000 Americans are expected to have filed for unemployment
claims for the week-ended Oct. 1, rising by 10,000 from the
previous week.
Growing fears of a looming recession in corporate leadership is
expected to weigh on capital spending and job openings, Goldman
Sachs said in a note.
At 6:39 a.m. ET, Dow e-minis were down 172 points, or 0.57%, S&P
500 e-minis were down 25.25 points, or 0.67%, and Nasdaq 100
e-minis were down 79.75 points, or 0.69%.
(Reporting by Ankika Biswas in Bengaluru)
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