US pre-open: Futures higher as oil volatility, CPI dominate sentiment

(Sharecast News) - Wall Street futures were in the green ahead of the bell on Wednesday as market participants looked ahead to last month's all-important consumer price index. As of 1215 GMT, Dow Jones futures were up 0.09%, while S&P 500 and Nasdaq-100 futures had the indices opening 0.16% and 0.18% firmer, respectively.

The Dow closed 34.29 points lower on Tuesday, taking a bite out of gains recorded in the previous session as markets absorbed the Trump administration's latest remarks on Iran and oil prices extended their move lower.

Wednesday's primary focus will likely be February's consumer price index report, due out at 1230 GMT, with traders looking for any hints as to the strength of the US market and economy, particularly after recent weak jobs data. Economists expect to see headline CPI increase 2.4% year-on-year.

Oil prices also remained in focus, having surged close to $120 a barrel on Monday amid mounting concerns over the conflict in Iran, before heading south on Tuesday as hopes grew that a group of nations might tap emergency crude reserves. West Texas Intermediate dropped to an intraday low of $76.73 before settling almost 12% lower at $83.45 a barrel, while Brent crude slid more than 11% to close at $87.80 per barrel.

However, oil prices pushed higher again early on Wednesday, rising more than 2.6% as both Brent and US crude moved back above $85 a barrel, despite reports the the G7 group of nations supported, in principle, the implementation of proactive measures to address the situation, including the use of strategic reserves.

The Wall Street Journal, citing unnamed sources, said the International Energy Agency's plan to unlock reserves would exceed the 182m barrels of oil that IEA member countries put onto the market in two releases in 2022 when Russia launched its full-scale invasion of Ukraine. The proposal was reportedly circulated at an emergency meeting of energy officials from the IEA's 32 member countries on Tuesday, with a decision expected on Wednesday. It would be adopted if none objects, but even one country's protests could delay the plan, officials said.

The renewed rally also followed reports that three vessels had been hit by "projectiles" in the Strait of Hormuz amid reports that Iran was laying mines in the key waterway. The UK Maritime Trade Operations service reported vessels had been struck off Dubai, the UAE coast and north of Oman, where the crew had been evacuated. US officials claimed military strikes had destroyed 16 mine-laying vessels in the strait, which accounts for 20% of global oil shipments and has been closed since the war started almost two weeks ago.

Elsewhere on the macro front, US mortgage applications rose 3.2% week-on-week in the seven days ended 6 March, according to the Mortgage Bankers Association of America, with the fourth consecutive weekly increase taking applications to their second highest level since 2022. Applications to purchase a new home surged by 7.8%, while applications to refinance a mortgage, which are more sensitive to short-term changes in interest rates, ticked up 0.5% on the week.

No major corporate earnings were slated for release on Wednesday.







Reporting by Iain Gilbert at Sharecast.com