US pre-open: Futures point to modest gains following Fed announcement

Wall Street futures pointed to some small gains ahead of the first full session since the Federal Reserve cut its target interest rates for the first time in more than a decade.

As of 1230 BST, Dow futures were up 0.20%, while S&P 500 and Nasdaq futures had the indices opening 0.14% and 0.25% firmer, respectively.

At the closing bell, the Dow had shed 333.75 points after the Fed voted to reduce its benchmark interest rate by 25 basis points to a target range of between 2% and 2.25% - the central bank's first cut since December 2008.

Investors, who had largely been expecting such a move, appeared more interested in the comments from chairman Jerome Powell, who said the cut was part of its ongoing work to keep in line with economic conditions and was no guarantee of future cuts.

“We're thinking of it essentially as a mid-cycle adjustment to policy," Powell said, warning markets not to consider the move as the start of rate-cutting cycles as in the past.

"That refers back to other times when the FOMC has cut rates in the middle of a cycle and I'm contrasting it there with the beginning of a lengthy cutting cycle.

"That is not what we're seeing now, that's not our perspective now."

Donald Trump took aim at Powell via Twitter, saying the chairman had "let us down" by not clearly signalling more rate cuts.

Powell said the Fed, which operates independently of the White House, would never move rates because of political factors.

Nonetheless, later during his presser, Powell said: "I didn't say this was one and done", prompting some traders to reportedly grumble that they had been wrong-footed by his initial remarks.

Elsewhere, the US and China ended a brief round of trade talks, achieving no real progress towards ending their protracted dispute, as expected.

Chinese Foreign Minister Wang Yi stressed the importance of cooperation with the US following talks with Secretary of State Michael Pompeo.

On the data front, weekly jobless claims will be released at around 1330 BST, while July's ISM manufacturing index will be posted at 1500 BST, just behind the manufacturing PMI data at 1445 BST. Construction spending figures for June will also be published at 1500 BST.

On the corporate front, General Motors, DuPont, Verizon, Petrobas, Western Union and Pinterest will all publish their latest quarterly figures throughout the course of the day.