US pre-open: Futures pointing lower as investors digest OPEC+ production cut

Stocks on Wall Street were set for a modestly lower start to trading on Thursday as investors digested the surprisingly big production cut announced by OPEC+ the day before.

The day before, the cartel of producer nations and its Russian-led allies had announced an imminent reduction in their combined production quotas of 2.0m barrels a day, twice the size of the cut anticipated by analysts.

The announcement had stoked concern regarding the drag that would have on demand and of its potential impact on inflation and interest rates.

Some investors were likely also loathe to chase the bear market rally any further until the monthly non-farm payrolls report was out of the way.

On Friday, consensus expected the Department of Labor to report that hiring in the US rose at a pace of 250,000 people in September.

As of 1040 BST, futures tracking the Dow Jones Industrials were falling by 97.0 points to 30,213.0, alongside a 45.25 point decline for those linked to the Nasdaq-100 which were trading at 11,578.50.

Front-dated West Texas Intermediate crude oil futures were little changed, edging up by 0.11% to $87,87 a barrel on the ICE.

The US dollar spot index was flat at 111.1970.

On the back of the latest OPEC+ decision, analysts at Morgan Stanley bumped up their Brent oil price forecast for the first quarter of 2023 from $95 a barrel to $100 a barrel but continued to expect that oil would trade at $95 in the last quarter of 2022 and at $100 over the three months to June 2023.

A key assumption was that the European Union's looming oil import embargo would result in a 1.0-1.15m barrel a day reduction in Russian output when it came into force.

On the economic calendar for Thursday, at 1330 BST the Department of Labor was scheduled to publish initial weekly unemployment figures for the week ending on 1 October (Barclays Research: 210,000).

At least four top Federal Reserve were set to take to the podium, starting from 1800 BST with Chicago Fed chief, Charles Evans.