Wednesday March 2nd

2-03-2016

Futures slightly lower; oil, data eyed

U.S. stock index futures pointed to a flat to slightly lower open Wednesday as investors digested a global rally in risk assets and a big night for U.S. politics. In economic news, the ADP employment report showed U.S. private employers added 214,000 jobs in February. Futures temporarily came off session lows, while the 2-year yield briefly ticked higher to 0.88 percent. U.S. crude oil futures traded about 1 percent lower near $34 a barrel, giving back Tuesday's gains after a late-day industry report said U.S. crude inventories jumped by 9.9 million barrels last week. The U.S. Energy Information Administration oil inventory data is due at 10:30 a.m. ET. Investors will also be watching for more hints on future policy at the U.S. Federal Reserve and whether it will continue its tightening process this year. San Francisco Fed President John Williams is due to speak at 11 a.m. ET. The Fed's Beige Book is scheduled for release at 2 p.m. Results are still emerging from the biggest day of U.S. presidential primary contests, or Super Tuesday, where Hillary Clinton and Donald Trump looked set to win the majority of states. Trump walked away from the contest with a strengthened claim to the GOP nomination, but both of his chief national rivals notched wins that will most likely propel them onto the next series of contests. Elsewhere on Wednesday, there are just a few earnings, including Abercrombie & Fitch, Brown-Forman, Costco, American Eagle Outfitters, Pure Storage and Semtech. European and Asian markets pushed higher after a stellar rally on Wall Street on Tuesday. Stocks surged in the U.S. Tuesday, in the best start to a month in more than three years. The Dow closed up 2.1 percent at 16,865 and the S&P 500 bounced 2.4 percent to 1,978. Equities were boosted by a few factors, including February ISM manufacturing data and oil, which rallied to close near the key $35 per barrel area. But investors are set to pause for breath on Wednesday. Asian markets rose Wednesday, with China leading advances after a strong finish on Wall Street overnight. The Japanese benchmark Nikkei 225 index closed at a three-week high, up 661.04 points, or 4.11 percent, at 16,746.55. The yen hovered at the 114 handle against the dollar, after falling overnight. The dollar/yen pair traded at 114.37 as of 4:37 p.m. HK/SIN time. Chinese markets also rallied, shrugging off news that ratings agency Moody's changed the country's credit rating outlook to negative from stable. The Shanghai composite finished up 115.93 points, or 4.24 percent, at 2,849.10, while the smaller Shenzhen composite added 79.10 points, or 4.7 percent, to 1,760.58. Oil prices pared losses on Wednesday morning, but Brent remained below $37 a barrel as an industry report showing a rise in U.S. crude stockpiles to a new record countered support from producer efforts to tackle a supply glut. U.S. crude inventories jumped by 9.9 million barrels last week, the American Petroleum Institute (API) said on Tuesday, much more than the 3.6-million-barrel increase analysts had forecast. Global benchmark Brent crude was down 14 cents at $36.67 a barrel by 9 a.m. ET (1400 GMT). On Tuesday, it reached $37.25, the highest in almost two months. U.S. crude, also known as WTI, was down 38 cents at $34.02. Gold dropped for a second session on Wednesday as the dollar rose and global shares strengthened after strong U.S. data rekindled speculation the Federal Reserve could still raise interest rates this year. Spot gold was up 0.16 percent to $1,233.86 an ounce, while U.S. gold futures for April delivery were up 0.33 percent at $1,234.90 an ounce.