Stock futures erase losses as Wall Street shakes off fears of higher rates

A trader works on the floor of the New York Stock Exchange (NYSE) in New York.
Michael Nagle | Bloomberg | Getty Images
A trader works on the floor of the New York Stock Exchange (NYSE) in New York.

U.S. stock index futures rose slightly on Thursday as investors shook off fears of rising interest rates.

Around 7:40 a.m. ET, Dow Jones industrial average futures were up 31 points, indicating a gain of 27 points at the open. Earlier, Dow futures pointed to a drop of more than 100 points. The Nasdaq and S&P 500 futures also pointed to slight gains for their respective markets.

Investor anxiety was brought back to the surface Wednesday, after minutes from the Federal Reserve's latest meeting revealed that members saw an uptick in inflation and increased economic growth as reasons for the central bank to continue its path on raising interest rates gradually.

The news consequently put investors on edge, with U.S. government debt yields rising sharply following the document's release, and Wall Street reversing gains, to finish the session lower. In terms of inflation, the Fed said it still saw it reaching its 2 percent objective, adding that inflation didn't look like it was getting out of control.

In economic data, initial jobless claims will be released at 8:30 a.m. ET, followed by The Conference Board's Leading Economic Index at 10 a.m. ET and the Kansas City Fed manufacturing index, due out at 11 a.m. ET.

Speaking of the economy, Fed Governor Randal Quarles, New York Fed President William Dudley, Atlanta Fed President Raphael Bostic, and Dallas Fed President Rob Kaplan are all due to deliver remarks at separate engagements Thursday — with investors waiting to see if they provide further comments on the central bank's minutes release.

St. Louis Fed President James Bullard, meanwhile, told CNBC's "Squawk Box" that too many rate hikes could slow down the economy too much.

"The idea that we need to go 100 basis points in 2018, that seems like a lot to me," he said. "Everything would have to go just right. The economy would have to surprise on the upside a bunch of times during the year. I'm not sure that's a good way to think about 2018."

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Elsewhere, investors will be paying close attention to the U.S. political space for any developments surrounding Russia's alleged involvement in the 2016 U.S. presidential election or the Donald Trump administration's response to gun control. When it comes to the latter, on Wednesday the U.S. president showed support for background checks and arming teachers to prevent school shootings.

—CNBC's Jeff Cox contributed to this report