Monday September 14th

14-09-2015

U.S.Futures turn mostly negative

U.S. stock index futures were tipped to open flat to slightly lower Monday, with focus turning to this week's closely-anticipated U.S. Federal Reserve meeting. There were mixed cues from global markets, with European shares opening the day higher while Asian stock markets closed mostly lower following weak data from China at the weekend. U.S. stock futures fluctuated between slight gains and losses, with Dow Jones industrial average futures last trading about 20 points lower. The U.S. central bank meets on Wednesday and Thursday amid continued debate over the timing of the first interest rate hike in almost a decade. Futures markets are pricing in about a 24 percent chance of a rate hike this week following recent volatility in markets, heightened concerns about the outlook for China's economy and low inflation expectations. "Our Fed-watcher Philip Marey maintains his long-held view that December is the most likely date for the Fed's policy rate lift-off," analysts at Rabobank said in a note. "Fasten your seatbelts, as it could be another volatile week ahead of us." This week's Fed meeting was expected to overshadow concerns about China for now. Data on Sunday showed investment and factory output in China fell short of analyst expectations in August, fueling concerns about the outlook for the world's second biggest economy. China's factory output rose 6.1 percent from a year earlier, compared with market expectations for a 6.4 percent rise. While Chinese officials said on Monday, Beijing will work to reform large state-owned companies, the news failed to shore up shares with the benchmark Shanghai Composite index closing down 2.67 percent. Nikkei tanks 1.6%. Japan's Nikkei 225 index turned significantly lower, taking its cues from a slide in Chinese shares and as telecommunication shares plunged. There are no major U.S. economic releases on the calendar for Monday, with this week's key data including retail sales and industrial output numbers for August on Tuesday. U.S. stocks closed mildly higher on Friday, with the Dow Jones industrial average closing 0.6 percent higher. Oil prices were under pressure on Monday as weaker-than-expected Chinese data weighed on markets, adding to concerns that declining global demand would exacerbate a surplus of crude. Traders are also waiting to see whether the U.S. central bank raises interest rates for the first time in nearly a decade later this week. Front-month Brent crude futures were down 64 cents at $47.50 a barrel by 7:54 a.m. EDT. U.S. crude futures were down 24 cents at $44.39 a barrel. The International Energy Agency said last week that ongoing production cuts would lead to a rebalancing of the oil market by next year. Gold edged down on Monday, just above a one-month low as European stocks rose ahead of a Federal Reserve policy meeting that will be scrutinized for clarity on when the U.S. central bank will raise interest rates. Spot gold was down about 0.22 percent at $1,104.76 an ounce. It had fallen to $1,098.35 on Friday, the lowest since Aug. 11. U.S. gold for December delivery was flat at $1,104, also close to its lowest in a month.