Wall Street set for sharply lower open as selloff continues

NEW YORK (Reuters) - U.S. stocks index futures were poised to open sharply lower on Thursday, after the S&P 500 closed at its lowest in six months, amid concerns about weak global demand and its potential impact on the U.S. economy and businesses.

The S&P 500 <.SPX> and Nasdaq <.IXIC> briefly fell into negative territory for the year on Wednesday, as the S&P tumbled more than 3 percent to a session low before rallying late in the session. The drop also came on worries over the spread of Ebola and its possible impact on the travel industry.

The benchmark S&P index has dropped in six of the past eight sessions and is down 7.4 percent from a record closing high Sept. 18. The CBOE Volatility index <.VIX> is up 118 percent since the S&P record, and closed Wednesday at its highest since June 2012. The VelocityShares Daily 2x VIX Short Term exchange-traded note jumped 28.7 percent to $6.28 in premarket.

Recent earnings reports have done little to stem the tide of the equity rout. Netflix shares plunged 26.1 percent to $331.52 in premarket after it reported quarterly results and said it signed up fewer video-streaming subscribers than forecast for the quarter.

Goldman Sachs shares were off 3.7 percent to $173.25 in premarket after posting quarterly results.

Futures briefly pared losses after labor market data showed initial jobless claims data dropped 23,000 to a seasonally adjusted 264,000, its lowest since 2000, but the market quickly moved back to prior levels.

"The challenge with earnings is it's all backward looking and the market is always forward looking," said Randy Frederick, managing director of trading and derivatives for Charles Schwab in Austin, Texas.

"When you get in a mode like we are in now, where the market is clearly bearish, investors are somewhat fearful, they tend to focus more on the negatives than the positives, which is why they are ignoring this jobless claims number."

S&P 500 e-mini futures were down 20.75 points and fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract, indicated a sharply lower open. Dow Jones industrial average e-mini futures <1YMc1> fell 138 points and Nasdaq 100 e-mini futures lost 44.75 points.

The earnings of S&P 500 companies are expected to grow 6.7 percent in the third quarter, according to Thomson Reuters data through Wednesday, on revenue growth of 4 percent. Google is expected to report earnings after the closing bell on Thursday.

Shortly after the open, at 10:00 a.m. (1400 GMT), the NAHB/Wells Fargo Housing Market index and Philadelphia Fed's manufacturing business outlook for October are due.

Baker Hughes shares tumbled 10.6 percent to $47.95 after the world's No.3 oilfield services provider reported a lower-than-expected profit for the first time in five quarters.

(Editing by Bernadette Baum)

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