US pre-open: Stocks seen flat ahead of Yellen speech

US futures pointed to a muted open on Wall Street, where all eyes will be on Federal Reserve Chair Janet Yellen’s speech at Jackson Hole.

At 1100 BST, Dow Jones Industrial Average, S&P 500 and Nasdaq futures were all flat.

At the same time, oil prices edged lower. West Texas Intermediate was down 0.3% at $47.18 and Brent crude was down 0.7% at $49.31.

Yellen’s speech will provide the main focus on Friday as investors look for clues on the timing of an interest rate hike.

Mike van Dulken, head of research at Accendo Markets, said: “The sway the US Federal Reserve has over global markets is as evident as ever with investors holding fire on taking on too much risk before knowing the latest views on US rate-hike timing from a key-note speech by Chair Janet Yellen this afternoon. It's by no means a given that she'll pepper her talk with hints about when another US rate rise is coming; that's not how the game is played. However, an easing of USD strength suggests some receding of recent hawkish fears.

“Many believe she is almost cornered into taking the opportunity to deliver a clear message before September's FOMC policy update. Whether that message helps or hinders markets remains to be seen; does hawkishness equate to a signal of US recovery or another step towards the end of easy monetary policy? Markets can be fickle.”

Meanwhile, Societe Generale said it was doubtful Yellen will signal the timing of the next hike and more likely she will strike a balance between an improved economic outlook requiring a normalisation of rates and ongoing caution given uncertainties on inflation, global economic and financial trends

In corporate news, Herbalife was in the black in pre-market trade on news that billionaire investor Carl Icahn has discussed selling his stake in the company.

Elsewhere, software company Splunk, beauty products retailer Ulta Salon Cosmetics and video game retailer GameStop all looked set for losses at the open following disappointing earnings late on Thursday.

Yellen’s speech is due at 1500 BST. On the macroeconomic calendar, the second release of second-quarter US gross domestic product is at 1330 BST, while University of Michigan consumer sentiment is at 1500 BST.