Skip navigation
Newswire

US STOCKS-Futures gain ahead of Fed policy decision

* Fed expected to continue stimulus amid lackluster data

* U.S. private sector adds 130,000 jobs in Oct-ADP

* Futures up: Dow 46 pts, S&P 2.8 pts, Nasdaq 14.75 pts

By Angela Moon

NEW YORK, Oct 30 (Reuters) - U.S. stock index futures edged higher on Wednesday, a day after the Dow and the S&P 500 indexes hit a new closing record, on expectations that the Federal Reserve's monthly bond purchases of $85 billion will be extended into next year.

Shares of General Motors Co rose 1.5 percent in premarket trading in the wake of better-than-expected quarterly profit, thanks to strength in its core North American market and a smaller-than-anticipated loss in Europe.

The Federal Reserve is expected to maintain its massive bond-buying campaign when it concludes a two-day policy-making meeting on Wednesday, and may indicate that its stimulus measures will be extended into 2014 amid softer readings on the U.S. economy.

A report by a payrolls processor showed early Wednesday that U.S. private-sector employers added 130,000 jobs in October, fewer than economists expected.

So far in this earnings season, 296 companies representing 66 percent of S&P 500's market capitalization have reported.

"All of the 10 sectors have beaten their earnings-per-share expectations and the aggregate earnings surprise is 4.5 percent," said Jonathan Golub, chief U.S. market strategist at RBC Capital Markets in New York.

S&P 500 futures rose 2.8 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures rose 46 points and Nasdaq 100 futures added 14.75 points.

Shares of Yelp Inc fell nearly 10 percent in premarket trading a day after the business-search service firm reported a wider third-quarter loss.

LinkedIn Corp shares dropped 3 percent in premarket trading in the wake of the company's conservative forecast Tuesday for revenue for the rest of the year.

Companies due to report Wednesday include Comcast, Visa, Starbucks, MetLife and Kraft .

The U.S. central bank, which will announce its policy decision at 2:00 p.m. EDT (1800 GMT), has held interest rates near zero since late 2008 and has quadrupled the size of its balance sheet to more than $3.7 trillion through three rounds of bond buying. The purchases are aimed at holding down longer-term borrowing costs.

The Fed shocked markets in September by opting to maintain its bond-buying program, after raising expectations over the summer that it was ready to start scaling back the purchases. The central bank's caution has since been vindicated.