US pre-open: Stocks to nudge lower ahead of FOMC minutes

Stocks on Wall Street looked set for a slightly weaker open on Wednesday as investors awaited the release of the latest Federal Reserve minutes for more clues on the timing of the next rate hike.

At 1120 BST, Dow Jones Industrial Average, S&P 500 and Nasdaq futures were all down 0.2%.

Stocks slumped on Tuesday after aluminium giant Alcoa kicked off the third-quarter earnings season with weaker-than-expected numbers.

Oil prices were in the black, with West Texas Intermediate up 0.3% at $50.95 a barrel and Brent crude 0.6% higher at $52.73.

In currency markets, the pound was up 1.3% versus the dollar at $1.2267 following a Bloomberg report suggesting Prime Minister Theresa May has accepted to hold a parliamentary vote on her plans for taking the UK out of the European Union, raising hopes that this would help curb her push for a hard Brexit.

As well as the Fed minutes, which are at 1900 BST, investors will watch out for speeches by New York Fed President William Dudley and Kansas City Fed President Esther George.

Oanda’s Craig Erlam said: “Three of the 10 voting FOMC members dissented at the last meeting, all of whom are permanent voters, which would strongly suggest that a majority is not far away, not with a number of other policy makers appearing to lean that way, including chair Yellen herself.

“The minutes today could offer good insight into just how close others are to voting for a hike, what it is they want to see before doing so and just how many voters are currently on the fence. We tend to have quite a good idea of all this from the large number of appearances we now get from Fed officials, but more information is always welcome and could spark some volatility in the markets.”

Societe Generale said that overall, the risks were biased towards the hawkish side, keeping the door open for a December rate hike.

In corporate news, Amazon.com nudged just a touch higher in pre-market trade after announcing plans on Tuesday to introduce convenience stores

There were no earnings due, but banks will be in focus on Friday with the release of updates from JPMorgan Chase, Wells Fargo and Citigroup.