At around 9:17 a.m. ET, Dow Jones Industrial Average futures indicated a opening loss of about 100 points. Meanwhile, S&P 500 and Nasdaq futures were also lower.
The moves in premarket trade come after the Fed decided to hike its benchmark overnight lending rate by one quarter point on Wednesday. The Dow fell more than 350 points following the Fed’s decision and pushed the major indexes to new lows for the year.
The Dow, S&P 500, and Nasdaq Composite all notched new closing and intraday lows for 2018 in the previous session.
For traders, the Fed’s statement and Chairman Jerome Powell’s subsequent press conference did not suggest that the central bank would slow its pace of rate hikes as quickly as some had hoped.
Commenting on the central bank’s decision, renowned hedge fund manager David Tepper said in an email to CNBC’s Joe Kernan that Powell “basically told you the Fed put is dead ” and that “cash is not so bad” as an investment.
“The Fed doesn’t care about the stock market within 400 SPX (S&P 500) points,” Tepper added in the email. “It’s the real economy, stupid.”
Markets also took a leg lower on comments the central bank would continue to reduce the size of its balance sheet at the same rate.
The Fed currently is allowing $50 billion a month to run off its massive debt balance sheet as its securities mature. The balance sheet is mostly a collection of bonds the central bank purchased to vitalize the economy during and after the financial crisis.
“I think that the run-off of the balance sheet has been smooth and has served its purpose,” Powell said during a news conference, before adding: “I don’t see us changing that.”
The Dow and S&P 500, which are both in correction territory, are on track for their worst December performance since the Great Depression in 1931, down more than 8 percent and 9 percent, respectively. The S&P 500 is now in the red for 2018 by 6.3 percent.
The Dow has lost over 1,250 points this week.
“We, too, were very vocal in recommending heavily that the Fed not hike yesterday,” said Julian Emanuel, chief equity strategist at BTIG.
“This is all about the speed of things,” Emanuel added. “The problem with ignoring the consequences of the balance sheet reduction really tells you that the Fed is not paying attention to that fact that financial markets correct much more rapidly on the downside than they do in bull markets to the upside.”
On the data front, investors are likely to closely monitor Philly Fed manufacturing figures for December at around 8:30 a.m. ET, with the latest jobless claims data scheduled for publication at the same time.
In corporate news, Accenture, Walgreens Boots Alliance and Carnival are among the major companies expected to release their latest quarterly earnings before the opening bell. Nike and Cintas are both scheduled to publish their latest results shortly after Thursday’s trading sessions ends.