Monday April 4th

4-04-2016

US futures higher; Street eyes oil prices

U.S. stock index futures indicated a higher open Monday with investors closely watching the price of oil and awaiting more comments from U.S. Federal Reserve members. The oil price has led to volatility in equity markets in recent months and traded in a range ahead of the U.S. open. WTI futures traded at around $36.95 a barrel after dipping close to the $36-a-barrel mark. European markets gained ground on the spike, after a choppy start to the trading day, and global sentiment recovered after a mixed session overnight in Asia. Back in the U.S., investors will be monitoring factory orders data due at 10 a.m. ET. Meanwhile, there's more Fed speak for traders to look out for. This after a better-than-expected nonfarm payrolls figure on Friday and some dovish comments from Chair Janet Yellen last week. Boston Fed President Eric Rosengren is due to speak at 10:15 a.m. ET on Monday, while Minneapolis Fed President Neel Kashkari and Dallas Fed President Rob Kaplan are both due to speak after the closing bell. U.S. stocks closed higher Friday, shaking off pressure from low oil prices. The Dow Jones industrial average closed up about 107 points at its highest since December 4, 2015. Asian markets were mixed Monday, not getting much of a boost from the better-than-expected U.S. jobs data last week, while Japanese shares lost ground on the back of a stronger yen. Japan's Nikkei 225 gave up early gains to finish down 40.89 points, or 0.25 percent, at 16,123.27. The Kospi in South Korea closed up 5.4 points, or 0.27 percent, at 1,978.97. Markets in China, Hong Kong and Taiwan are closed today. Oil seesawed on Monday as investors ditched some of their bullish bets on another price rise and the chances that top exporters will agree to rein in overproduction appeared to fade. Iran will continue increasing oil production and exports until it reaches the market position it enjoyed before the imposition of sanctions, Oil Minister Bijan Zanganeh was quoted by the semi-official Mehr news agency as saying. Saudi Arabia, which spearheaded an initial proposal in February for producers to limit output, said last week it would not join any effort to do so unless Iran were on board, while Russia reported its highest oil production in 30 years. This has cast doubt on the ability of the world's largest exporters to reach any such agreement when they meet this month in Doha to discuss how best to align global supply and demand. Hedge funds last week cut their bullish holdings of crude oil futures for the first time in six weeks. Brent crude futures were up 16 cents at $38.83 a barrel by 8:23 a.m. ET (1223 GMT), having risen by at least 40 percent since mid-February. U.S. crude futures rebounded from negative territory and were up 25 cents at $37.04 a barrel. Gold fell on Monday after a strong U.S. labor report boosted investor risk sentiment and the dollar stabilized, while uncertainty continued about the Federal Reserve's interest rates path. Spot gold eased 0.3 percent to $1,218.81 an ounce, while U.S. gold for June delivery slipped $3.50 to $1,220 an ounce.