By Shubham Batra and Amruta Khandekar
(Reuters) -U.S. stock indexes were set to open lower on Wednesday after data showed private payrolls rose more than expected in October, adding to recent fears that the Federal Reserve will not have enough reason to tone down its aggressive policy approach.
The ADP (NASDAQ:ADP) National Employment report showed private payrolls rose by 239,000 jobs last month. Economists polled by Reuters had expected an increase of 195,000 jobs.
The report follows data on Tuesday that showed a jump in U.S. monthly job openings, signaling strong labor demand and providing further evidence that the central bank's rapid interest rate hikes have yet to significantly slow the economy.
The Fed is expected to deliver a fourth straight 75 basis point (bps) hike at the end of its policy meeting on Wednesday. The decision is due at 2:00 p.m. ET (1800 GMT), but focus will be on commentary from Fed Chair Jerome Powell later.
"The Fed has said they're going to be data dependent and that is not good because the inflation numbers are still high and unemployment is low," said Fall Ainina, director of research at James Investments.
"The numbers are still not there for the Fed to really pivot."
Still, traders are split on the odds of a 50 bps or 75 bps rate hike in December, according to CME Group's (NASDAQ:CME) Fedwatch tool.
The non-farm payrolls report due on Friday will offer further clues on the outlook for interest rates.
Hopes of a less hawkish Fed and better-than-expected earnings reports lifted Wall Street's main indexes in October, with the Dow notching its biggest monthly percentage gain since 1976.
Advanced Micro Devices (NASDAQ:AMD) Inc rose 6% premarket after it forecast some strength in its data center business, while Airbnb (NASDAQ:ABNB) Inc tumbled 6.4% on a bleak holiday-quarter revenue forecast.
At 8:46 a.m. ET, Dow e-minis were down 99 points, or 0.3%, S&P 500 e-minis were down 7.75 points, or 0.2%, and Nasdaq 100 e-minis were down 8.25 points, or 0.07%.
Among other stocks, Estee Lauder (NYSE:EL) cut its full-year sales outlook, sending the cosmetics maker's shares down 9.5%.
U.S.-listed shares of Chinese firms Alibaba (NYSE:BABA), JD.com and Baidu (NASDAQ:BIDU) rose between 0.9% and 3%, tracking a second straight session of gains on hopes about easing of strict COVID-19 measures in the world's second largest economy. [.SS]