Stock futures pointed to a higher open, recovering from a
decline yesterday as investors may have been convinced that the
U.S. Federal Reserve will maintain its $85 billion-a-month asset
purchasing program after Boston Fed President Eric Rosengren said
the Fed is in no hurry to raise short-term rates and that the
decision to taper is dependent on data.
Later today, Fed President Sandra Pianalto will speak on the
housing sector and the economic outlook. Tomorrow the advance Q3
GDP report is due out while the October jobs report is due out
Meanwhile, Goldman Sachs economist Jan Hatzius said in a report
yesterday that he expects the Fed to change its baseline for
determining interest rates. Currently, the central bank follows the
Evans Rule, under which it won't hike rates until either
unemployment falls to 6.5% or inflation rises to 2.5%. Hatzius
believes the Fed will lower the unemployment threshold to 6.0%.
Hatzius reportedly cited papers by Fed staff economists William
English and David Wilcox that support such a move.
In equities, Tesla Motors (
) dropped 11.20% in pre-market trade after setting a Q4 guidance
below expectations while Time Warner (
) rose 2.23% after reaffirming its 2013 outlook.
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