US futures advance ahead of Fed open policy meeting

A currency trader walks by the screen showing the foreign exchange rate between U.S. dollar and South Korean won at a foreign exchange dealing room in Seoul, South Korea, Tuesday, Nov. 1, 2022. Shares have advanced in Asia despite a retreat on Wall Street. Hong Kong jumped more than 3% and most other indexes saw strong gains. (AP Photo/Lee Jin-man)

Currency traders watch their computer monitors at a foreign exchange dealing room in Seoul, South Korea, Tuesday, Nov. 1, 2022. Shares have advanced in Asia despite a retreat on Wall Street. Hong Kong jumped more than 3% and most other indexes saw strong gains. (AP Photo/Lee Jin-man)

A currency trader stands near the screens showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and South Korean won at a foreign exchange dealing room in Seoul, South Korea, Tuesday, Nov. 1, 2022. Shares have advanced in Asia despite a retreat on Wall Street. Hong Kong jumped more than 3% and most other indexes saw strong gains. (AP Photo/Lee Jin-man)

A currency trader walks work near the screens showing the foreign exchange rates at a foreign exchange dealing room in Seoul, South Korea, Tuesday, Nov. 1, 2022. Shares have advanced in Asia despite a retreat on Wall Street. Hong Kong jumped more than 3% and most other indexes saw strong gains. (AP Photo/Lee Jin-man)

Currency traders work near the screens showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and South Korean won at a foreign exchange dealing room in Seoul, South Korea, Tuesday, Nov. 1, 2022. Shares have advanced in Asia despite a retreat on Wall Street. Hong Kong jumped more than 3% and most other indexes saw strong gains. (AP Photo/Lee Jin-man)

Wall Street pointed higher in premarket trading ahead of this week's policy meeting of the Federal Reserve with most economists expecting the sixth hike this year for the central bank's main borrowing rate.

Futures for the S&P 500 rose 0.9% Tuesday and futures for the Dow rose 0.6%.

Stubborn inflation, the likes which hasn't been seen in the U.S. since the early 1980s, has prompted the Fed to rapidly crank up its key benchmark borrowing rate in a bid to cool the economy. Analysts expect the Fed to announce at the close of its meeting Wednesday that it has raised its rate by another three-quarters of a point. It would be the central bank's fourth consecutive .75 percentage point increase.

The Fed has already raised its key short-term rate by 3 percentage points since March, the fastest pace of hikes since the early 1980s. Those increases are intended to raise borrowing costs for mortgages, auto loans and business loans and cool inflation by slowing the economy.

While investors mostly expect the rate hikes to continue through then end of this year, there has been some hope that the Fed would ease up somewhat after the government reported that the U.S. economy contracted in the first half of the year. Still, the U.S. returned to growth in the most recent quarter and broadly healthy corporate earnings reports, sparked a buying spree on Wall Street in October.

More than half of the companies within the S&P 500 have reported results and shown overall earnings growth of 2.3%, according to FactSet.

U.S. markets finished lower on Monday, but major indexes still wound up with big gains for October, including the best month for the Dow Jones Industrial Average since 1976. The broader S&P 500, the benchmark for many index funds, had its first monthly gain since July, as did the Nasdaq composite.

In Asia overnight, Hong Kong jumped more than 5% and other world markets also advanced after a survey of Chinese manufacturing showed activity has improved.

The monthly manufacturing gauge from Caixin, a Chinese business news magazine, helped to counter renewed concerns about coronavirus outbreaks. It showed activity declined in October but at a slower rate than in the previous month.

The Hang Seng index in Hong Kong surged 5.2% to 15,455.27 after a comment circulated on social media saying, without citing any source, that the ruling Communist Party might set up a “reopening committee” to look at ways to wind down anti-virus controls that have disrupted trade and business.

A foreign ministry spokesman, Zhao Lijian, told reporters he was “not aware of what you just mentioned” when asked about the rumor.

In other Asian trading, the Nikkei 225 in Tokyo added 0.3% to 27,678.92, while the Kospi in Seoul jumped 1.8% to 2,335.22. Sydney’s S&P-ASX 200 gained 1.6% to 6,976.90. India’s Sensex advanced 0.4%. The Shanghai Composite Index gained 2% to 2,940.75.

In European trading at midday, Germany's DAX added 1.3% and in Paris, the CAC40 surged 1.8%. Britain's FTSE 100 jumped 1.6%.

The European Union’s statistics agency, Eurostat, reported Monday that inflation hit 10.7% in October, another record in the 19 countries that use the euro currency, fueled by high prices for natural gas and electricity due to Russia’s war on Ukraine.

Investors are also waiting for the U.S. government's monthly employment report Friday for clues on whether the hot jobs market is cooling as inflation squeezes businesses. So far this year the labor market has remained tight, with unemployment around 50-year lows at 3.5% and companies adding jobs at a healthy clip.

Wall Street still has plenty of earnings to review from big companies this week. Pfizer shares rose 3% after it reported sales and profit that beat Wall Street targets. CVS reports on Wednesday and Starbucks releases its results on Thursday.

Shares of Abiomed jumped more than 50% in premarket after Johnson & Johnson announced it will spend $16.6 billion to buy the cardiovascular technology company.

In energy markets, benchmark U.S. crude oil gained $1.24 to $87.77 per barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the basis for pricing international oil, added $1.31 to $94.12 per barrel in London.

The dollar fell to 147.26 yen from Monday's 148.73 yen. The euro rose to 99.32 cents from 98.82.

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AP Business Writer Joe McDonald in Beijing contributed. Kurtenbach reported from Bangkok; Ott reported from Washington.