Futures fall on FedEx warning, recession fears

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(Reuters) – U.S. stock index futures slipped on Friday, extending falls from overnight, after logistics industry bellwether FedEx withdrew its financial forecast and recession warnings from the World Bank and the International Monetary Fund.

Shares of FedEx Corp plunged 19% in premarket deals after it said a global demand slowdown accelerated at the end of August and predicted that it would worsen in the November quarter.

United Parcel Service Inc slid 6.8%, while Amazon.com Inc dropped 2.7% to lead declines among mega-cap peers.

Meanwhile, the World Bank said the global economy might be inching toward a recession as central banks across the world simultaneously hike interest rates to combat persistent inflation, while the International Monetary Fund said it expected a slowdown in the third quarter.

The warnings come ahead of the Federal Reserve’s meeting next week, where the central bank is widely expected to deliver its third straight 75 basis point interest rate hike.

At 04:31 a.m. ET, Dow e-minis were down 260 points, or 0.84%, S&P 500 e-minis were down 38 points, or 0.97%, and Nasdaq 100 e-minis were down 144 points, or 1.2%.

Futures signaled that the S&P 500 index would open below 3,900 points, a level that traders considered as a key support level for the benchmark.

(Reporting by Shreyashi Sanyal in Bengaluru; Editing by Sriraj Kalluvila)