A mild open likely for the U.S stocks Wednesday as key stock index futures were down in the morning. Investor attention has moved to political and economic uncertainties across the globe.
At 03:00 a.m. ET, Dow futures fell more than 50 points, implying a negative open of 38 points. Futures on the S&P 500 and Nasdaq also traded lower.
Tuesday’s decline of Boeing shares by 6 percent over worries from the safety of its popular airplanes cast a shadow on American stocks.
Many countries grounded flights involving the 737 Max model. They include China, the European Union, and Indonesia.
Meanwhile, the U.K Parliament’s rejection of the Brexit deal and more votes on other options including a no deal exit or staying back for more time are adding to market volatility.
At the data front, figures on durable goods, PPI numbers, and construction spending will be out on Wednesday. Cloudera and MongoDB are among the companies that will report earnings.
Oil prices jumped on Wednesday, pushed by ongoing supply cuts from producer cartel OPEC and U.S. sanctions against Iran and Venezuela.
Per barrel price in International Brent crude oil futures moved to $66.85 at 0341 GMT, up 0.3 percent from the last close.
U.S. West Texas Intermediate (WTI) crude futures per barrel increased to $57.12 per barrel, up 0.5 percent from the last settlement.
Oil prices are gaining momentum from the supply squeeze run by the producer group Organization of the Petroleum Exporting Countries (OPEC).
Market’s tightening increased further from the U.S. sanctions against Iran and Venezuela. National Australia Bank (NAB) in a note said the outlook on the oil market is looking mixed.
“On balance, we see a very gradual uptrend for oil this year, with Brent forecast to reach $70 per barrel by the end of the year,” NAB observed.
The U.S. crude oil production is to rise an average of 12.30 million BPD in 2019, the U.S. Energy Information Administration (EIA) said, up from the 11 million BPD in 2018.
Asian stocks fall
Asia Pacific markets were mostly in the red and traded lower on Wednesday as many global uncertainties clashed including the Brexit issue.
Japan’s Nikkei 225 lost nearly 1 percent, Topix fell 0.84 percent. The Kospi index slumped 0.41 percent while Hong Kong’s Hang Seng index plunged 0.52 percent.
The downside affected mainland Chinese shares as well. The Shanghai composite plunged 1.09 percent while the Shenzhen composite was down 2.31 percent. Australia’s ASX 200 dropped 0.22 percent.
Gold zoomed to a near two-week peak on Wednesday. It regained the key $1,300 level in the previous session as investors started chasing the safe-haven metal, spurred by Brexit worries and dollar’s weakness.
Spot gold jumped 0.3 percent at $1,305.21 per ounce, as of 0329 GMT after hitting $1,305.69 in the early part of the session. That was the highest since March 1.
The U.S. gold futures moved up 0.5 percent to hit $1,305 an ounce.
“The ongoing Brexit uncertainties diminished risk appetite as investors are unnerved on the potential of a ‘hard Brexit’ deal,” commented Benjamin Lu, an analyst with Singapore-based Phillip Futures.