10am: Wall Street stocks open lower as oil prices spike
US stocks have opened lower, after oil prices rebounded on new threats from Iran to retaliate against Gulf energy infrastructure.
The Dow Jones started with a 0.5% drop, with the S&P 500 and Nasdaq falling 0.3%.
Biggest fallers on the Dow are Amgen, Coca Cola and Procter & Gamble.
Among the big tech names, Nvidia, Alphabet and Apple are flat, with the Mag 7 all slightly in the red.
WTI oil has risen to above $98 a barrel, with Brent crude topping $108 as newswires reported that Gulf oil and gas producers were evacuating “multiple sites” after warnings of attacks from Iran.
8am: Wall Street futures point to small gains
US stocks are set to open slightly higher on Wednesday as investors react to oil price fluctuations and brace for the Federal Reserve decision and forecasts later in the day.
Futures for the Dow Jones, S&P 500 and Nasdaq were all up around 0.1%, down from gains of 0.3-4% earlier, after oil prices hardened.
European indices were higher this morning, with positive closes across Asia-Pacific overnight, but saw gains pared as oil prices reacted to the latest headlines.
That follows a positive Wall Street session the day before, where the Nasdaq again led the way with a 0.5% gain to close at 22,480, while the S&P 500 added 0.25% points to 6,716 and the Dow edged up 0.1% to 46,993.
Energy stocks lagged after WTI crude slipped to below $92 a barrel, helped by a rise in US crude inventories reported by the American Petroleum Institute. The US Energy Information Administration releases its own inventory figures later today.
As the clock ticked towards the opening bell in New York, WTI climbed back above $96 a barrel, with Brent crude rising above $106 a barrel.
It came on the back of reports that Iran has taken parts of its South Pars gas field offline following recent strikes, raising concerns over tighter LNG supply and rising global energy costs.
Joshua Mahony at Scope Markets said that the recent release of strategic oil reserves was “expected to keep a lid on prices for the time being,” though he warned that “the tightness in global energy markets does look likely to provide major risks for markets as we go forward.”
This means traders may be distracted when the Federal Reserve publishes the decision from the March meeting of the Federal Open Market Committee, which is widely expected to hold interest rates steady.
Investors will also focus on the Fed’s latest ‘dot plot’ showing where policymakers expect interest rates in coming months for any signs of increased hawkishness.
Mahony expects the dot plot “to take a hawkish turn given the ongoing conflict,” but adds that “the realisation that these forecasts are likely to change will lessen their impact.”
Fed chair Jerome Powell will hold what will be his penultimate press conference ahead of his retirement from the role in May.
