By Peter Nurse
Investing.com – U.S. stocks are set to open muted on Thursday, stabilizing after the previous session’s strong selloff as investors assimilate the Federal Reserve’s increasingly hawkish stance.
As of 7 a.m. ET (1200 GMT), the contract was up 100 points, or 0.3%, trading 2 points, or 0.1%, higher, while falling 60 points , or 0.4%.
Major Wall Street indexes closed sharply lower on Wednesday after the Federal Reserve’s December meeting signaled the possibility of faster-than-expected U.S. rate hikes and a withdrawal of stimulus.
The blue chip lost nearly 400 points, or 1.1%, after hitting an intraday high earlier, while the broad base fell 1.9%. The , an index that includes many growth-sensitive stocks, suffered the most, falling 3.3%, its biggest one-day loss since February.
“So now the Fed wants to end QE sooner, wants to raise rates sooner and shrink the balance sheet,” said Michael Kramer, the founder of Mott Capital Management, “The market can’t agree with that. , and it shouldn’t be.Valuations across the broader market are too high to support such monetary tightening.
Fed policymakers pointed to a “very tight” labor market as a key factor pushing them to raise rates sooner than expected. soared last month, and attention now turns to weekly data due later Thursday, ahead of Friday’s key report.
In business news, the retail sector is expected to take center stage after Reuters reported foot traffic increased to Target (NYSE:) during the recent holiday season compared to two years earlier, while visits to Walmart (NYSE:) and best buy (NYSE:) stores fell overall.
Additionally, there will be quarterly earnings reports from Walgreens Boots Alliance (NASDAQ:) and Bed Bath & Beyond (NASDAQ:) before the bell on Thursday.
Oil prices strengthened on Thursday, helped by escalating unrest at oil producer Kazakhstan and supply outages in Libya.
Russia sent paratroopers to Kazakhstan on Thursday to quell a nationwide uprising. Although there is no indication that oil production has been affected so far, the former Soviet state currently produces 1.6 million barrels of oil per day.
Additionally, oil production is down by more than 500,000 barrels per day in Libya due to pipeline maintenance and oil field closures.
Crude prices had weakened on Wednesday after data from the US Energy Information Administration showed an increase of more than 10 million barrels, the largest weekly increase since April 2020, suggesting the American public is becoming reluctant to travel as as Covid cases increase.
As of 7 a.m. ET, futures were trading up 1.2% at $78.75 a barrel, while the contract was up 1.1% at $81.72. Both contracts reached their highest level since late November.
Additionally, it fell 1.5% to $1,797.30 an ounce as it traded slightly lower at 1.1308.