Off The Wire
Futures on back foot before Fed policy decision
(Reuters) - U.S. stock index futures dipped on Wednesday as investors waited for the Federal Reserve’s decision on interest rates in what has been a rocky week for global markets.
The central bank is expected to lower interest rates by a quarter percentage point for the second time in three months, but a deep divide among policymakers has seen traders abandon all bets on a third reduction this year.
The Fed’s policy statement is due at 2:00 p.m. ET (1800 GMT) followed by Chair Jerome Powell’s address a half hour later.
Rate-sensitive banks were little changed in premarket trading after the banking index .SPXBK closed 0.6% lower on Tuesday following an unexpected squeeze on short-term money market borrowing costs.
Central banks around the world have been taking steps to cushion the impact of a prolonged U.S.-China trade war and other geopolitical risks. Last week, the European Central Bank cut interest rates further and said it would buy back bonds indefinitely.
Expectations of lower rates have spurred a Wall Street rally this year, with the benchmark S&P 500 .SPX now less than 1% below its all-time high.
At 7:00 a.m. ET, Dow e-minis 1YMcv1 were down 18 points, or 0.07%. S&P 500 e-minis EScv1 were down 3.25 points, or 0.11% and Nasdaq 100 e-minis NQcv1 were down 9.25 points, or 0.12%.
Markets had come under pressure earlier this week after attacks on Saudi Arabia’s oil facilities caused a spike in oil prices and fueled geopolitical tensions.
Package delivery company FedEx Corp (FDX.N) warned its full-year earnings would miss analysts’ estimates, sending its shares 11.7% lower premarket.
Adobe Inc (ADBE.O) fell 2.3% after the Photoshop software maker forecast tepid revenue for the current quarter.
General Mills Inc (GIS.N) dropped 4% after missing quarterly sales expectations, hit by weak demand for its yogurt and snacks in the U.S domestic market.
Data expected at 8:30 a.m. ET (1230 GMT) is expected to show U.S. housing starts rising about 5% to 1.25 million in August from a month earlier.
Reporting by Medha Singh in Bengaluru; Editing by Anil D'Silva