US pre-open: Futures mixed following FOMC minutes

(Sharecast News) - Wall Street futures were pointing to a mixed open ahead of the bell on Thursday following heavy losses in the previous session. As of 1225 GMT, Dow Jones futures were up 0.15%, while S&P 500 futures were 0.05% firmer and Nasdaq Composite futures had the index opening 0.07% weaker.

The Dow closed 284.85 points lower on Wednesday amid a broad sell-off amid ongoing speculation regarding central bankers' potential moves around monetary policy.

Yesterday's minutes from the latest Federal Open Markets Committee pointed to greater hawkishness than implied by the market reaction to its December meeting, indicating that policymakers had viewed the policy rate as likely to be "at or near its peak" for this tightening cycle. However, they also noted that the path ahead will depend on "how the economy evolves" and reaffirmed that it "would be appropriate" for policy to remain at "a restrictive stance for some time" until inflation was clearly moving down "sustainably".

Finalto's Neil Wilson said: "This was no surprise. The dot plot only ever implied one additional rate cut in 2024 from previous iterations of the projections, and this was to be brought forward from 2025, implying monetary policy would not be any more restrictive in the long term. The market really latched onto a couple of remarks from Jay Powell in the presser - the minutes reveal a more cautious bunch of policymakers. They don't want to say they've won and the mindset is naturally more cautious now - too loose on the way in and too tight on the way out.

"Markets currently price in a cut by March but this seems way too optimistic, and it looks like June may be a better bet. Stocks are priced for perfection - soft landing and multiple rate cuts - but you cannot have both surely? I think instead the Fed stays higher for longer, mindful of pulling the cord too early and risk setting off inflation again. Investors will probably see this as being too restrictive and raising the risk of recession."

On the macro front, December employment change figures from ADP will be out at 1315 GMT, while jobless claims data will follow at 1330 GMT, and S&P Global's composite and services PMIs were slated for release at 1445 GMT.

In the corporate space, Walgreens Boots Alliance almost cut its dividend in half on Thursday despite reporting a significantly improved loss per share of $0.08, up from $4.31 at the same time a year earlier, and a 10% sales jump to $36.7bn, while Apple traded lower in pre-market after analysts at Piper Sandler downgraded the tech behemoth just days after Barclays did the same as a result of overstretched valuations and uncertainty regarding future interest rate cuts from the Federal Reserve and fears that investors may have grown overly optimistic.

Reporting by Iain Gilbert at Sharecast.com