Futures point to higher open after GDP data

NEW YORK (Reuters) - U.S. stock index futures pointed to a higher open on Wednesday after the first read on second-quarter economic growth came in much stronger than expected, overshadowing a weak report on the labor market.

Gross domestic product grew at a 4 percent annual rate in the second quarter, above the 3 percent rate that had been expected and a sharp reversal from the weather-impacted first quarter, when the economy contracted 2.9 percent.

Futures added to gains following the report, but had already been on track to open higher as investors sought bargains following a period of weakness.

Market participants shrugged off the ADP National Employment Report, which showed that companies hired 218,000 workers in July, a level that was below analysts' projections and was also down from June.

Twitter Inc surged 25 percent to $48.25 in heavy premarket trading a day after reporting that monthly active users had risen a better-than-expected 24 percent in the second quarter. The social networking company also gave a revenue outlook that was above forecasts.

The results could bolster support for Internet and other social media stocks, assuaging concerns the group is overpriced. Facebook Inc , which also posted strong results this quarter and is up almost 35 percent this year, rose 0.9 percent to $74.37 before the bell.

Among other earnings, American Express Co late Tuesday reported adjusted earnings that were in line with expectations, while WellPoint Inc's earnings beat expectations.

S&P 500 e-mini futures rose 8.75 points and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average e-mini futures gained 66 points and Nasdaq 100 e-mini futures rose 23 points.

The S&P 500 has slipped 0.9 percent over the past three sessions, and on Tuesday it closed below its 14-day moving average for the first time since July 17. That level had served as support of late, and staying decisively below it would be a sign that near-term momentum is weakening.

While this earnings season has been positive in aggregate, with more companies than usual beating expectations for both earnings and revenue, there have been some high-profile disappointments that worry investors about the state of the economy. On Tuesday, UPS gave a weak outlook that weighed on the broader markets, and last week Amazon.com Inc and Boeing Co disappointed.

At 2:00 p.m., the Federal Open Market Committee will release a statement as it concludes its latest policymaking meeting. The central bank is widely expected to trim its monthly asset purchases to $25 billion from $35 billion, which would leave it on course to shutter the program this fall. Investors are looking for any hint on whether officials are growing more anxious to start to reverse their monetary accommodation.

(Editing by Bernadette Baum)

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