By Saumya Vaishampayan
U.S. stock futures pared losses Thursday after a
stronger-than-expected reading economic growth in the third
quarter.
Dow Jones Industrial Average futures declined 23 points, or
0.1%, to 16901. S&P 500 futures fell four points, or 0.2%, to
1968 and Nasdaq-100 futures lost 12 points, or 0.3%, to 4061.
Changes in stock futures don't always accurately predict stock
moves after the opening bell.
Futures reduced their declines after data showed that U.S. gross
domestic product, the broadest measure of goods and services
produced across the economy, rose at an annual rate of 3.5% in the
third quarter. Economists surveyed by The Wall Street Journal had
expected 3.1% growth.
In other economic news, jobless claims rose 3,000 to 287,000 in
the week ended Oct. 25, the Labor Department said. Economists had
expected 285,000 claims. Still, the number of claims remained at
historically low levels.
The data came a day after the Federal Reserve announced the end
of its bond-buying program and brightened its economic outlook,
causing some jitters about when the central bank could begin to
raise short-term interest rates. Still, the Fed maintained its
pledge to keep rates low for a considerable time.
Stocks ended lower Wednesday after the Fed decision. The Dow
lost 0.2% to 16974.31 and the S&P 500 fell 0.1% to 1982.30.
The Dow is down 0.4% in October, through Wednesday's close. At
its lowest point in October, the blue-chip index was down 5.4%. The
rebound came as investors began to focus on third-quarter corporate
earnings. Companies in the S&P 500 are on track to grow
earnings 6.6% in the third quarter, according to FactSet, above the
4.5% expected before the start of the reporting season.
Investors said the speed of the recovery in stocks over the last
two weeks helped contribute to Wednesday's slight pullback after
the Fed and the spillover into Thursday's premarket trading.
"It's more of a short-term trading thing," said Colin
Cieszynski, chief market strategist at CMC Markets. "Markets had
been going almost straight up for two weeks."
In the long run, the Fed's more optimistic view on the U.S.
labor market and broader economy, as well as corporate earnings,
should lift stocks, he said.
Eurozone confidence picked up in October. The European
Commission's economic sentiment indicator rose to 100.7 from 99.9
in September, beating expectations. The Stoxx Europe 600 fell
0.6%.
In commodity markets, crude-oil futures fell 1.1% to $81.33 a
barrel. Gold futures dropped 1.7% to $1204.10 an ounce. The yield
on the benchmark 10-year Treasury note fell to 2.299% from 2.325%
on Wednesday.
In corporate news, Visa Inc. reported fiscal fourth-quarter
earnings that topped expectations and announced a $5 billion
share-buyback program. Shares rose 4.7% premarket.
Kraft Foods Group Inc. said third-quarter earnings fell 11% and
reported revenue that slightly missed expectations. Shares fell 3%
premarket.
Write to Saumya Vaishampayan at saumya.vaishampayan@wsj.com