Tuesday September 17th

17-09-2019

Stocks set to fall for a second day as Fed meeting kicks off

U.S. stock index futures were set to open slightly lower Tuesday morning as investors braced for the start of a two-day Federal Reserve policy meeting. Around 7:15 a.m. ET, Dow Jones Industrial Average futures fell 59 points, indicating a loss of 58 points at the open. S&P 500 and Nasdaq were also marginally lower. The Fed is set to kick off its meeting on Tuesday with an announcement scheduled for Wednesday at 2 p.m. ET. Fed Chairman Jerome Powell is set to hold a news conference after the central bank’s policy announcement. Market expectations are for the Fed to cut rates for the second time this year. However, expectations for the Fed to keep rates unchanged have risen to 34.2% from 7.7% a week ago, according to the CME Group’s FedWatch. Wall Street ended lower on Monday amid ongoing fears over a potential increase in oil prices, after drone strikes in Saudi Arabia. U.S. President Trump said he is not in a rush to respond to the attacks. Monday’s decline snapped an eight-day winning streak for the Dow. U.S. crude futures skyrocketed more than 14% on Monday, their biggest one-day gain since December 2008, after the attack. Energy stocks got a boost from the higher oil prices, with the sector gaining 3.41%. Investors will be looking ahead to a new business leaders survey, due at 8:30 a.m. ET; industrial production numbers will be out at 9:15 a.m.; and the housing market index due at 10 a.m. ET. Asia markets traded mixed on Tuesday as investor sentiment turned cautious over rising energy prices and heightened geopolitical tensions. In Japan, the benchmark Nikkei 225 erased earlier losses to finish fractionally higher at 22,001.32 while the Topix index added 0.29% to 1,614.58. South Korea’s Kospi index was near flat. Chinese mainland markets fell more than 1%: The Shanghai composite declined 1.74% to 2,978.12, the Shenzhen composite was down 2% at 1,651.35 and the Shenzhen component fell 1.97% to 9,722.80. In Hong Kong, the Hang Seng index dropped 1.4% in late afternoon trade. Oil prices fell on Tuesday after surging the most on record following a series of attacks on Saudi Arabia’s oil industry that disrupted the kingdom’s crude production. Brent crude futures, the international benchmark, fell 87 cents, or 1.27%, to $68.14. The contract soared as much as 19.5% on Monday to $71.95 per barrel, the biggest jump in history. U.S. West Texas Intermediate futures slipped 84 cents, or 1.34%, to $62.07 per barrel after posting their biggest climb since 2008 in the previous session. Gold prices were steady on Tuesday as investors adopted a wait-and-see approach ahead of the U.S. Federal Reserve’s two-day monetary policy meeting, when the central bank is widely expected to cut interest rates. Spot gold firmed slightly, adding 0.43% to $1,504.3 an ounce. Gold prices rose more than 1% early Monday before settling 0.6% up for the day after a weekend attack on oil facilities in Saudi Arabia inflamed worries over stability in the Middle East. U.S. gold futures rose 0.05% at $1,512.