Thursday, October 28

Futures rise as taper fears fade


Article content

US stock index futures rose on Thursday, indicating Wall Street was set to jump further from recent lows after investors largely brushed off concerns over the Federal Reserve’s plans for tapering.

The Fed said on Wednesday it could begin reducing its monthly bond purchases by as soon as November, and that interest rates could rise quicker than expected by next year. The bank also projected inflation at 4.2% by the year-end, more than twice its target rate of 2%.

The November deadline had been largely priced in by markets. Relief over the Fed, along with easing concerns of a default by Chinese property developer Evergrande, saw all three Wall Street indexes jump around 1% on Wednesday.

Article content

The Dow and the S&P had marked their best day in two months, as they staged a strong recovery from two-month lows hit earlier in the week.

On Thursday, major banks rose in premarket trade on expectations of an eventual rise in interest rates.

US S&P 500 E-minis were up 26.5 points, or 0.6%, at 6:29 am ET. Dow E-minis were up 185 points, or 0.54%, while Nasdaq 100 E-minis were up 98.75 points, or 0.65%.

Major Wall Street indexes are still trading lower for the month, owing to seasonally weak trends, as well as concerns over fiscal spending and a slowdown in economic growth. (Reporting by Ambar Warrick in Bengaluru; Editing by Maju Samuel)



financialpost.com