US pre-open: Futures point to positive start to trading ahead of Fed announcement

Wall Street futures had stocks opening higher on Wednesday, with traders preparing themselves for the outcome of the Federal Reserve's latest policy meeting later in the day.

As of 1210 BST, Dow futures had the index opening 0.22% firmer, while S&P 500 and Nasdaq futures were 0.13% and 0.30% higher, respectively.

The Dow closed 23.33 points softer on Tuesday as a fresh round of trade talks between Chinese and US officials kicked off in Shanghai.

While both sides were already looking to downplay expectations of a quick end to the trade war, Donald Trump further dampened any hopes that it would be possible after taking aim at China in a series of tweets.

On Tuesday morning, Trump said China was not keeping its promise of buying more US agricultural products and said the world's second-largest economy was "doing very badly". However, China insisted it has, in fact, purchased US agricultural products.

Looking ahead to the afternoon, the Federal Reserve was expected to make its first interstate's rate cuts since the financial crisis more than ten years ago. Investors were expecting a cut of 0.25% at 1900 BST.

Oanda's Craig Erlam said: "The stock market seems to hinge on the Fed to cut interest rates to a satisfactory degree while signalling more to come in the near future.

"While it would be easy for the Fed to deliver, I'm still not convinced they will. There has been a significant reluctance to cut rates until now, probably in part because it acknowledges that December's hike was a policy mistake and because it gives the impression that they're caving to pressure from the White House."

Erlam noted that while a rate cut was "almost guaranteed", he feared that markets would be disappointed by "the lack of a clear laid out path for more cuts in the coming months".

Elsewhere on the data front, ADP payrolls for July will be published at 1315 BST, while the Chicago Purchasing Manager index will follow at 1445 BST.

In corporate news, General Electric's second-quarter earnings came in ahead of expectations on the Street, pushing shares up in pre-market trading.

Spotify, Qualcomm and Vale were also all slated to report on Wednesday.