Tuesday May 24th

24-05-2016

Dow futures briefly add 100 points; oil steadies

U.S. stock index futures pointed to a higher open Tuesday, following gains in European equities, amid stabilization in oil prices. The U.S. dollar index traded higher, with the euro near $1.116 and the yen near 109.7 yen against the dollar. "Sideways action seems the order of the day when it comes to equity indices and the moves in the FX space are little different this morning," Brenda Kelly, the head analyst at London Capital Group, said in a morning note. Investors are still awaiting more clues from members of the U.S. Federal Reserve on whether the central bank will hike rates again next month. Traders also remain transfixed on global oil prices which crept lower during the European morning session. New data out of Germany, a dovish governor of the Reserve Bank of Australia and further news on the U.K.'s "Brexit" referendum also sent currency markets in different directions. Major European indexes traded about 1.5 percent higher or more in early morning trade ET after opening lower. In Asia, most indexes finished lower on Tuesday. The Nikkei 225 closed down 0.94 percent, or 155.84 points at 16,498.76, amid pressure from fresh strength in the yen against the dollar. Across the Korean Strait, the Kospi ended lower 0.9 percent, or 17.57 points at 1,937.68. Australia's S&P/ASX 200 closed down 0.44 percent, or 23.343 points at 5,295.6, weighed by a 1.28 percent decline in the energy sub-index. Chinese mainland markets fell, with the Shanghai composite closed down 0.76 percent, or 21.604 points to 2,822.041, while the Shenzhen composite settled down 0.9 percent, or 16.389 points to 1,804.603. In Hong Kong, the Hang Seng index closed up 0.11 percent, or 21.4 points at 19,830.43. On Monday, U.S. stocks closed lower in low volume trade. On the earnings front, Best Buy and Toll Brothers reported before the bell. Intuit will update with new numbers after the bell. New home sales for April are due out at 10:00 a.m. ET and are expected to show a 2.5 percent rise to 524,000 compared to a 1.5 percent contraction in March. The Richmond Fed survey will also be released at 10:00 a.m. ET. At 11:00 a.m. ET, the New York Federal Reserve releases new results from its second-quarter Household Debt and Credit Report Survey. Oil reversed early losses after falling for a fifth consecutive day on Tuesday on rising production from major exporters, and as the dollar strengthened. However, traders anticipate data will show U.S. crude stockpiles fell in the previous week. Brent futures were up 20 cents to $48.55 a barrel by 8:22 a.m. ET (1222 GMT), after closing down 37 cents in the previous session. U.S. crude futures rose 30 cents to $48.38 a barrel, having settled down 33 cents the day before. Both contracts finished with modest losses for a fourth straight session on Monday, and are on track for their longest losing streak since January. Gold fell to a 3-1/2 week low on Tuesday as hawkish comments from Federal Reserve officials in the previous session sent the dollar to a two-month high against a currency basket. The prospect of an early rate hike, as indicated by Fed meeting minutes released last week, and a strengthening dollar have pushed gold down nearly 4 percent so far in May, putting it on track for its biggest monthly decline since November. Spot gold was down 0.8 percent at $1,238.01 an ounce, while U.S. gold futures for June delivery were down $13.30 an ounce at $1,238.10.