(Reuters) – U.S. stock index futures inched higher on Wednesday ahead of a widely expected interest rate hike from the Federal Reserve, with investors looking for signs the central bank could tone down its aggressive stance on future rate hikes.
Wall Street’s three main indexes closed lower on Tuesday after a jump in U.S. monthly job openings pointed to strong labor demand, indicating that the effect of the rapid rate hikes are yet to be felt.
The U.S. central bank is widely expected to lift interest rates by 75 basis points to a range of 3.75% to 4.00% at the end of a two-day meeting on Wednesday. The decision is due at 2:00 p.m. ET (1800 GMT), followed by Fed Chair Jerome Powell’s news conference.
However, traders are split on the odds of a 50 bps or 75 bps rate hike in December, according to CME Group’s Fedwatch tool.
The ADP National Employment report, due at 8:15 a.m. ET, is expected to show private payrolls rose by 195,000 jobs in October, according to a Reuters poll of economists, after gains of 208,000 in September.
The more comprehensive nonfarm payrolls report is due on Friday and will likely offer more clues about the health of the labor market.
Hopes of a less hawkish stance from the Fed and better-than-expected earnings reports boosted Wall Street’s main indexes in October, with the Dow notching its biggest monthly percentage gain since 1976.
Of the 307 S&P 500 companies that have reported so far, 72.3% have topped analysts’ profit estimates, according to Refinitiv IBES data. In a typical quarter, about 66% beat estimates.
Advanced Micro Devices Inc rose 4.2% in premarket trading after it forecast some strength in its data center business and said it would be careful with spending.
Airbnb Inc fell 5.8% after the vacation rental company forecast holiday-quarter revenue that fell short of market expectations and warned that bookings would moderate.
At 5:34 a.m. ET, Dow e-minis were up 1 point, S&P 500 e-minis were up 2.25 points, or 0.06%, and Nasdaq 100 e-minis were up 12.25 points, or 0.11%.
U.S.-listed shares of Chinese firms Alibaba, JD.com and Baidu rose between 3.4% and 6.0%, looking to extend their gains for a second session on rising expectations about easing of strict COVID-19 measures in China. [.SS]
(Reporting by Shubham Batra in Bengaluru; Editing by Shounak Dasgupta)
