US index futures little changed before data

Zurich - US stock-index futures were little changed, after equities fell Monday for the first time in three days, as investors awaited economic data and Thursday’s Federal Reserve announcement on interest rates.

Standard & Poor’s 500 Index Emini contracts expiring in December gained less than 0.1% to 1 944.25 as of 14:11. Futures on the Dow Jones Industrial Average lost 4 points, or less than 0.1% to 16 275. Stocks declined yesterday after their best week since July with volume falling amid the Jewish new-year holiday.

“People are waiting to see what’s going to happen,” said Konstantin Giantiroglou, head of investment advisory and research at Neue Aargauer Bank in Brugg, Switzerland.

“I don’t expect any rate increase. My best guess is that they will come with the rate increase in October, although looking at economic data, a rate increase is overdue.”

Data due today will show the pace of retail sales growth slowed in August, while industrial output contracted, economists forecast.

An index tracking manufacturing in the New York region extended its decline in September after sliding at the fastest pace since the depths of the last recession the previous month, according to estimates.

Speculation has increased that the Fed will delay raising rates as China ignited concern that its slowdown could weigh on global growth. While investors remain confident the central bank will increase borrowing costs this year, traders are pricing in just a 30% chanceof action on Thursday, down from 48% before China’s currency devaluation last month.

Odds of a move at the December gathering are about 59%, according to data compiled by Bloomberg.

Equities have been particularly volatile recently, with the Chicago Board Options Exchange Volatility Index jumping a record 135% in August amid the first 10% correction in US equities in four years.

Since 1990, the measure of market turbulence known as the VIX has averaged 16.9 when US policy makers started raising rates. It closed Monday at 24.25. If the Fed increases rates this week, it would be the first time since 1946 it has done so within a month of a correction.

The bull market that began in March 2009 is the third longest in history, but it’s the longest ever to go without an increase by the Fed, eclipsing the nearest competitor by more than eight months. Economists are evenly split on whether there will be a hike, with about half the 81 surveyed by Bloomberg predicting a rate increase.

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