US STOCKS-Futures edge higher in bounce after Fed-triggered swoon
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* Futures up: Dow 0.25 pct, S&P 0.28 pct, Nasdaq 0.40 pct
By Medha Singh
The Fed raised interest rates on Wednesday and projected twohikes next year, instead of three, but what spooked the marketswas Fed Chairman Jerome Powell saying the central bank wouldkeep its balance sheet reduction on autopilot.
The specter of rising borrowing costs only added to concernsof slowing corporate profit growth next year amid slackeningeconomic growth, with growing fears of a recession in thebackdrop of the China-U.S. trade war and a host of othergeopolitical concerns.
"Investors were expecting a more dovish tone from Powellgiven the sharp fall in equity markets and challenging globalmacroeconomic conditions. All they got was a less hawkish tone,"said Hussein Sayed, chief market strategist at FXTM.
U.S. stocks swooned on the news, with the Dow JonesIndustrial Average .DJI closing at its lowest since Novemberlast year and the Dow Jones Transport .DJT closing nearly 21percent below its record high, confirming bear territory.
The benchmark S&P 500 index .SPX was 14.5 percent lowerfrom its record closing high on Sept. 20, with 298 componentsnow down 20 percent or more from their 52-week highs.
While futures ticked higher on Thursday, it remains to beseen if the gains will hold. In what has been a turbulent monthfor U.S. stocks, the market has more often than not failed tobuild on an uptick in early trading.
At 7:09 a.m. ET, Dow e-minis 1YMc1 were up 59 points, or0.25 percent. S&P 500 e-minis ESc1 were up 7 points, or 0.28percent and Nasdaq 100 e-minis NQc1 were up 25.5 points, or0.4 percent.
The rate hike along with worries about an oversupply sentoil prices down more than 3 percent. Oil major Exxon Mobil CorpXOM.N fell 0.2 percent.
Altria Group IncMO.N slipped 0.3 percent after thetobacco giant said it would pay $12.8 billion for a 35 percentstake in e-cigarette startup Juul Labs Inc.urn:newsml:reuters.com:*:nL3N1YP380
On the economic front, initial claims for state unemploymentbenefits for the week ended Dec. 15 are expected to rise to216,000 from 206,000 in the week before. The data is due to 8:30a.m. ET. (Reporting by Medha Singh in Bengaluru; Editing by ShounakDasgupta) ((Medha.Singh@thomsonreuters.com; within U.S. +1646 223 8780,outside U.S. +91 80 6749 1130; Reuters Messaging:email@example.com))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.