Futures flat as oil rally
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[December 06, 2016]
By Yashaswini Swamynathan
stock index futures were little changed on Tuesday, a day after the Dow
closed at a record high, as a rally in oil prices lost steam.
Brent crude slipped 0.3 percent to $54.80, its first decline in five
days as output rose in every major region despite plans by OPEC and
Russia to cut production. The commodity has risen more than 18 percent
since the output limit agreement was announced last week. [O/R]
U.S. stocks have climbed since the Nov. 8 election, fueled by
expectations of significant economic stimulus and cuts in corporate
taxes and regulations under President-elect Donald Trump.
However, the rally has split, with the Dow marking a series of record
highs due to gains in industrials and bank stocks, while sectors such as
utilities and technology names have held back the S&P 500 and the Nasdaq.
The Federal Reserve has been preparing the markets for higher interest
rates encouraged by a spate of strong economic data. Traders currently
see a whopping 92 percent chance of a move when the central bank meets
next Tuesday and Wednesday, according to Thomson Reuters data.
The central bank has entered a self-imposed quiet period until its news
conference on Dec. 14.
Data scheduled on Tuesday includes a report on trade deficit, which is
expected to have risen to $41.8 billion in October, compared to a
deficit of $36.4 billion the previous month. The data is due at 8:30
a.m. ET (1330 GMT).
The Commerce Department issues a report on factory orders data for
October at 10:00 a.m. ET. The report is likely to show new factory goods
orders rose 2.6 percent in the month after adding 0.3 percent in
Wall Street closed higher on Monday, with the Dow setting new record
intraday and closing highs, buoyed by strong services data and gains in
Shares of Starwood Property fell 4.6 percent to $21.85 in premarket
trading after the REIT priced a second stock offering at a discount to
its previous close.
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Traders work on the floor of the New York Stock Exchange (NYSE) in
New York City, U.S., December 5, 2016. REUTERS/Brendan McDermid
Pandora rose 4.6 percent to $13.99 after brokerage Aegis Capital initiated
coverage on the online radio company's stock with a "buy" rating and a $16 price
DryShips surged 12.8 percent to $5.19 after Morgan Stanley reported a passive
6.1 percent stake.
Futures snapshot at 6:59 a.m. ET:
Dow e-minis were up 2 points, or 0.01 percent, with 16,276 contracts changing
S&P 500 e-minis were up 0.75 points, or 0.03 percent, with 101,365 contracts
Nasdaq 100 e-minis were up 3.25 points, or 0.07 percent, on volume of 10,625
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Sriraj Kalluvila)
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