Stock futures higher as oil prices rebound

[June 26, 2017]  By Tanya Agrawal

(Reuters) - U.S. stock index futures were higher as oil prices rebounded, while investors awaited economic data for a reading on the health of the economy.

Oil rose for a third straight session, as speculators took advantage of last week's drop to seven-month lows, although a relentless increase in U.S. supply and little evidence of a widespread drop in global inventories capped gains. [O/R]

The recent drop in oil prices have spurred concerns about low inflation, which stubbornly remains below the Federal Reserve's 2 percent target rate.

The central bank raised rates this month for the second time this year and is expected to raise it again. Futures imply only a 50 percent chance of another rate hike by December.

Fed Chair Janet Yellen speaks on London on Tuesday and investors will look for any clues to the rate outlook, after mixed views from other Fed officials in recent days.

On Monday, San Francisco Fed President John Williams said the Fed needs to raise rates gradually or the economy runs the risk of overheating.

Traders work on the floor of the New York Stock Exchange shortly after the closing bell in New York, U.S., June 23, 2017. REUTERS/Lucas Jackson

Data is expected to show new orders for key U.S.-made capital goods likely rose slightly in May, with non-defense orders, a closely watched proxy for business spending plans, probably rising 0.3 percent. The report is due at 8:30 a.m. ET (1230 GMT).

U.S. stocks ended higher on Friday after a last-minute trading spike, helped by gains in technology sector, which offset weakness in financial stocks, sending the Nasdaq higher and giving it a weekly gain for the first time in three weeks.

Shares of Portola Pharmaceuticals were up 4 percent at $58.32 in premarket trading, after the FDA, on Friday, approved a new oral blood-thinner made by the company.

Micron was up 1.5 percent at $32.20 after Cowen & Co increased its price target on the chipmaker's stock.

(Reporting by Tanya Agrawal; Editing by Arun Koyyur)

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