US pre-open: Futures point to open in the red ad Fed hints at December hike

US stock futures turned south on Thursday, after the Federal Reserve hinted at a possible interest rates hike in December and investors awaited some important economic reports.

The Dow Jones Industrial Average is expected to open approximately down 78 points, while the S&P 500 and the Nasdaq are set to begin the session nine and 27 points lower respectively.

On Wednesday, the Fed decided to keep interest rates unchanged at 0.25%, as most analysts' expected, and left the door open to an increase in December.

The US central bank downplayed global economic headwinds in its statement on the decision, which was made after a two-day policy meeting, saying that it was monitoring developments abroad.

“The fact that last night’s FOMC policy statement left the door wide open for a December rate hike is consistent with the rhetoric that has been flowing from Fed officials,” said analysts at Rabobank.

With the US central bank opening the door to a potential rate hike for as early as December, economic data released over the next two months will be of even greater significance.

Key data ahead

On Thursday, investors will analyse a series of key economic reports, starting with a reading on third quarter GDP and personal consumption released at 1230 GMT.

“There is still a lot of bullishness in markets after the strong run during October but the Fed has put that at risk,” said CMC Markets’ analyst Jasper Lawler.

“The central bank’s renewed focus on domestic data rather than international developments adds to the importance of the third quarter US GDP report in determining the Fed’s next move in December.”

A report on initial jobless claims is also scheduled for 1230 GMT and is expected to show the number of people filing for unemployment last week grew from 259,000 to 265,000.

Meanwhile, at 1400 GMT market participants will analyse a reading on pending home sales for September.

GoPro slumps

In company news, GoPro tumbled 18.2% in pre-market trading after the maker of action cameras said late on Wednesday its earnings and sales missed estimates.

There was better news for botox-treatment maker Allergan, which surged 11.3% after it revealed it was recently approached Pfizer over a potential takeover.

ConocoPhilips, MasterCard and Time Warner Cable will report quarterly earnings before the bell, while Starbucks and LinkedIn will report after the close.

Elsewhere, European stocks pulled back slightly, while Asian markets struggled for direction and oil prices declined, with West Texas Intermediate losing 1.41% to $45.32 a barrel and Brent losing 1.59% to $48.28 a barrel.

The dollar was broadly flat against the yen and the pound but lost 0.33% against the euro, while gold futures edged 0.14% higher to $1,157.74.