Futures rise on oil rally after U.S. exits Iran deal

[May 09, 2018]   By Sruthi Shankar

(Reuters) - U.S. stock index futures rose on Wednesday, with shares of energy companies getting a boost from a rally in oil after President Donald Trump pulled the United States out of a nuclear deal with Iran.

Oil rose more than 3 percent to hit 2014 high after Trump announced the "highest level" of economic sanctions against Iran after 180 days, casting uncertainty over global oil supplies.

Trump was willing to negotiate a new deal, but Tehran already has ruled that out.

Shares of oil majors Exxon <XOM.N> and Chevron <CVX.N> were up about 1 percent in premarket trading.

The S&P energy index <.SPNY> closed up 0.78 percent on Tuesday, as Wall Street was whipsawed by conflicting reports on whether Trump will withdraw or not, ahead of the official announcement.

The U.S. 10-year Treasury yield <US10YT=RR> rose to a two-week high back above the key 3 percent level. Analysts said expectations for higher interest rates continued to drive bond yields higher, overshadowing any fallout from the U.S. exit from the Iran nuclear deal for now. [US/]

Walmart <WMT.N> fell 2 percent after it acquired a controlling stake in Indian homegrown e-commerce firm Flipkart for about $16 billion, the U.S. retailer's biggest foreign investment. At 7:12 a.m. ET, Dow e-minis <1YMc1> were up 128 points, or 0.53 percent. S&P 500 e-minis <ESc1> were up 11.75 points, or 0.44 percent and Nasdaq 100 e-minis <NQc1> were up 22.75 points, or 0.33 percent.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., May 3, 2018. REUTERS/Brendan McDermid

After a recent inflation reading crossed the Federal Reserve's target level, investors are awaiting for data on U.S. producer and consumer prices.

The Labor Department report, due at 8:30 a.m. ET, will likely show that the producer price index rose 0.2 percent in April after a 0.3 percent rise in March. Consumer prices data is due on Thursday.

Match Group <MTCH.O> rose 5.6 percent after the Tinder-owner beat analysts' estimates for quarterly revenue and profit as it attracted more subscribers to its dating apps and websites.

Walt Disney <DIS.N> dipped 0.5 percent, despite beating profit estimates.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Anil D'Silva)

[© 2018 Thomson Reuters. All rights reserved.]

Copyright 2018 Reuters. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.  Thompson Reuters is solely responsible for this content.