U.S. stock futures drifted a little lower (later a little higher) Thursday morning following Wednesday's Federal Reserve's statement that it was keeping rates at record low levels. However, earnings from tech giant Cisco accompanied by an upbeat outlook could give a boost to tech. Also this morning, investors will watch as retail chain-stores report October sales.[Update: Futures now point to a higher open following retail sales data, earnings and lower claims numbers.]
On Wednesday, Wall Street ended mixed and relatively flat after the Federal Reserve decided to keep rates steady. While conceding the economy has picked up, policymakers said this was not enough to hike interest rates, saying an increase will instead depend on when the labor market and inflation pickup. Given that there have been no inflationary pressures and that unemployment is expected to rise, the dollar weakened yesterday and short-term Treasury yields fell. The Fed also cautioned consumer spending would remain strained. Of course, the market would have liked to see a stronger show of confidence.
Not much on the economic docket this morning, ahead of tomorrow's Nonfarm Payroll report. At 8:30 a.m. Eastern, weekly initial and continuing claim is due out and is expected to further decline. At the same time, third quarter productivity will be released and is expected to rise.
Retail chains same-store sales results for October will likely take the spotlight this morning. In general, these are expected to be positive. Sales are expected to have risen 1.2 percent overall, according to Thomson Reuters data.
Overseas, world stock markets fell Thursday after the U.S. Federal Reserve cautioned about the wider economic impact of rising unemployment. Investors awaited interest rate decisions in Europe later in the day.
In earnings news, Cisco (NASDAQ: CSCO) late Wednesday posted a stronger-than-expected profit for its fiscal first quarter and said business was recovering as customers are buying more network equipment again. And this morning, Toyota (NYSE: TM) posted a surprise profit last quarter and trimmed its projected losses for the year.
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