Wednesday December 13th

13-12-2017

US futures pause for breath ahead of Fed rate decision

U.S. stocks futures are set for a relatively flat open on Wednesday as a monetary policy decision from the Federal Reserve looms. Dow Jones industrial average rose just 22 points, while Nasdaq 100 futures gained 12points. S&P 500 futures traded 1 point higher. While politics and individual stock news may move markets somewhat during today's session, investors will be placing most of their attention on a rate decision and policy announcements by the U.S. Federal Reserve, all due out at 2 p.m. ET. Market-watchers expect the U.S. central bank to raise rates for one last time this year during its December meeting, after it announced in October that despite inflation, a rate hike was all but certain. Aside from an interest rate decision, traders will be paying close attention to what the Fed will say in regards to tax reform and the state of the U.S. economy. In earnings, Nordson, ABM Industries and Pier 1 Imports are all set to report after the bell. The consumer price index (CPI) rose 0.4 percent in November, as expected. In the previous session, U.S. equities closed higher amid growing optimism that Republican lawmakers could overhaul the corporate tax system. While tax reform is expected to keep investors on edge Wednesday, another area of domestic politics is set to shake up sentiment. Democrat Doug Jones is projected to be the apparent winner of a Senate election in Alabama, beating scandal-ridden Republican Roy Moore in one of America's deepest conservative states, according to NBC News. The result is expected to trigger ramifications for U.S. politics, with this win marking the first time in a quarter-of-a-century that a Democrat has been elected to the Senate from Alabama. Elsewhere, investors will be paying close attention to the latest moves in Bitcoin, after it launched on the Cboe Futures Exchange last weekend. Crude futures pointed higher Wednesday on the back of a larger-than-expected drawdown in U.S. crude stockpiles. Brent crude was up 27 cents at $63.61 a barrel by 9 a.m. ET (1400 GMT). It had settled down $1.35, or 2.1 percent, on Tuesday on a wave of profit-taking after news of a key North Sea pipeline shutdown helped send the global benchmark above $65 for the first time since mid-2015. U.S. West Texas Intermediate crude was up 39 cents, or 0.7 percent,at $57.53 a barrel, having settled the previous session down 85 cents. Overseas, European markets treaded water, while markets in Asia finished on a mixed-to-mostly positive note. Though the Nikkei 225 closed down 0.47 percent, or 108.10 points, at 22,758.07, there were gains among some automakers and most financial stocks. Across the Korean Strait, the benchmark Kospi index tacked on 0.79 percent to close at 2,480.55 as South Korean President Moon Jae-in began a four-day trip to China. Hong Kong's Hang Seng Index rose 1.65 percent by 3:23 p.m. HK/SIN. Mainland markets reversed early losses to finish the session higher. The Shanghai Composite tacked on 0.7 percent to close at 3,303.66 and the Shenzhen Composite advanced 0.77 percent to end at 1,915.77. Gold prices on Wednesday held near their lowest in nearly five months as investors looked ahead to an expected U.S. interest rate increase and clues from the U.S. Federal Reserve on its plans for further rises next year. Spot gold was down 0.2 percent at $1,241.53 an ounce. On Tuesday, it touched $1,235.92, the lowest since July 20. U.S. gold futures were up 0.1 percent at $1,243.40 an ounce.