© Reuters
By Peter Nurse
Investing.com -- U.S. stocks are seen opening lower Wednesday, continuing the previous session’s selloff on concerns that the Federal Reserve will have to maintain its aggressive monetary tightening stance for a longer period.
At 07:00 ET (12:00 GMT), the Dow Futures contract was down 70 points or 0.2%, S&P 500 Futures traded 15 points or 0.4% lower, and Nasdaq 100 Futures dropped 70 points or 0.6%.
The major averages closed lower Tuesday on fears the U.S. central bank will not be able to engineer a soft landing, sending the U.S. economy into recession.
The blue-chip Dow Jones Industrial Average dropped 350 points or 1%, while the broad-based S&P 500 fell 1.4%, and the tech-heavy Nasdaq Composite ended 2% lower.
The Fed meets next week for its last meeting of the year, and policymakers are widely expected to agree to a half-percentage point increase.
However, stronger-than-expected services data and a solid jobs report last week have raised fears that the central bank will have to keep interest rates at these elevated levels for longer than previously expected.
Investors will also digest the ramifications of U.S. Senator Raphael Warnock winning the Georgia runoff election, strengthening the Democrats' Senate majority and handing the Republican Party another loss in a disappointing midterm election season.
In the corporate sector, quarterly earnings are due from drinks maker Brown-Forman (NYSE:BFb), Campbell Soup (NYSE:CPB), and troubled video game retailer GameStop (NYSE:GME).
Additionally, MongoDB (NASDAQ:MDB) stock soared 27% premarket after the cloud database company surprisingly posted a quarterly profit and raised its forecast for the full year on the back of an increase in customers.
Dave & Buster’s Entertainment (NASDAQ:PLAY) stock fell 3.9% premarket after comparable store sales fell at the restaurant and video arcade operator, while Toll Brothers (NYSE:TOL) stock rose over 1% premarket after the luxury housebuilder shone in a difficult climate.
Crude oil prices edged higher Wednesday, helped by China easing a range of COVID mobility restrictions as well as a sharp fall in U.S. crude inventories.
The American Petroleum Institute, an industry body, estimated a drawdown in U.S. crude stockpiles of around 6.4 million barrels last week, according to data released Tuesday, suggesting demand remained strong in the world’s largest consumer.
The official numbers from the Energy Information Administration are due later Wednesday.
Trading has been volatile as the ramifications of the EU import ban and Group of Seven's $60-a-barrel price cap on seaborne Russian oil remain unclear.
By 07:00 ET, U.S. crude futures traded 0.2% higher at $74.38 a barrel, while the Brent contract traded 0.1% higher at $79.45, falling below $80 for the second time in 2022 during the previous trading session.
Additionally, gold futures rose 0.1% to $1,783.65/oz, while EUR/USD traded 0.2% higher at 1.0494.
