Thursday October 18th

18-10-2018

Stock futures point to a muted open as investors digest Fed minutes

U.S. stock-index futures pointed to a relatively flat open as investors digested comments from the Federal Reserve’s most recent meeting that showed the central bank was leaning toward more rate hikes moving forward. At around 7:10 a.m. ET, Dow Jones Industrial Average futures were down 71 points, indicating a decline of 28.68 points at the open. Futures on S&P 500 and Nasdaq 100 also pointed to a flat-to-negative open. The Fed minutes showed the central bank is still convinced tighter monetary policy is the best course of action for the economy to remain steady. Stocks fluctuated following the minutes’ release on Wednesday, before the major indexes closed lower. On the data front, new applications for U.S. unemployment benefits dropped last week and the number of Americans on jobless rolls fell back to levels last seen in 1973, suggesting a further tightening in labor market conditions. Initial claims for state unemployment benefits decreased 5,000 to a seasonally adjusted 210,000 for the week ended Oct. 13, the Labor Department said on Thursday. Data for the prior week was revised to show 1,000 more applications received than previously reported. Claims fell to 202,000 during the week ended Sept. 15, which was the lowest level since November 1969. Equity markets around the world have set their focus on rising interest rates and a slew of corporate earnings for the third quarter. On the earnings front, Travelers, Bank of NY Mellon and Blackstone are expected to report before the bell. Meanwhile, American Express and Paypal are expected to report after the bell. Stocks in Asia were broadly lower on Thursday, as a Fed report hinted at more rate hikes ahead. The Greater China markets were largely lower, as Hong Kong’s Hang Seng index slipped by 0.47 percent in the afternoon. Over on the mainland, the Shanghai composite dropped by 2.94 percent to close at around 2,486.42 while the Shenzhen composite fell by 2.74 percent to end the trading day at about 1,232.01, with shares of Chinese oil giant PetroChina plunged almost 8 percent. In Japan, the Nikkei 225 was lower by 0.8 percent to close at 22,658.16, while the Topix index slipped 0.54 percent to end the trading day at 1,704.64. Over in South Korea, the Kospi fell by 0.89 percent to close at 2,148.31. Oil fell $1 a barrel to below $80 on Thursday as the fourth weekly increase in U.S. crude inventories suggested ample supply, while Saudi-U.S. tension and falling Iranian exports lent support. Brent crude, the global benchmark, was down $1.25, or 1.6 percent, at $78.80 a barrel at 8:45 a.m. ET (1245 GMT). It has dropped by about $8 from a high of $86.74 reached on Oct. 3. U.S. crude was down $1.01, or 1.5 percent, at $68.74, after falling 3 percent in the previous session to settle below $70 for the first time in a month. Gold rose on Thursday, supported by an improved technical outlook after scaling key milestones as the market continued to hold out against a stronger dollar. Spot gold edged 0.1 percent higher to $1,223.02 an ounce by 1004 GMT. U.S. gold futures eased by 0.1 percent to $1,226.10.