Stocks - U.S. Futures Point Higher; Central Banks Eyed

By Peter Nurse - U.S. stocks are set to open a touch higher Wednesday, as investors look for more help from central banks to combat the damage caused by the ongoing coronavirus outbreak.

At 7:00 AM ET (1200 GMT), futures for the S&P 500 traded up 0.2%, futures for the Nasdaq up 0.4%, while the Dow Jones futures contract rose 0.3%.

China, the world's second-largest economy, is still struggling to get its manufacturing sector back online after imposing severe travel restrictions to contain a virus that emerged in the central province of Hubei late last year.

As a consequence, the People’s Bank of China is widely expected to cut its benchmark lending rate on Thursday as policymakers seek to offset the impact on businesses from the coronavirus outbreak. The central bank lowered the interest rate on medium-term loans earlier this week. Additionally, Bloomberg reported that the country is preparing a multi-billion-dollar bailout for the airline sector, while in the U.S., forward dollar rates are now clearly pricing in another interest rate cut from the Federal Reserve this year.

Back on Wall Street, Groupon stock (NASDAQ:GRPN) slumped 25% in late trading Tuesday after the online commerce company said it would stop selling goods by the end of the year, driven out by what it called “a fiercely competitive, and in some cases, economically irrational retail landscape.”

Additionally, shares in Herbalife (NYSE:HLF) climbed 5% in late trading after the health nutrition company reported strong fourth-quarter earnings that beat expectations.

In economic news, the latest housing starts and building permits are due at 8:30 AM ET (1330 GMT), but the release of the minutes from the last meeting of the Federal Reserve, at 14:00 ET (1900 GMT), will garner the most attention. Market players will look for more detail on the Federal Reserve’s plans to wrap up its balance sheet expansion.

Oil markets rebounded Wednesday, nearing their highest levels for three weeks, after the U.S. sanctioned a trading subsidiary of Russia's Rosneft for helping transport Venezuela's oil to refineries in India and China.

Eyes will later focus on the American Petroleum Institute’s measure of weekly crude inventories, at 16:30 ET (2130 GMT). Last week saw a weekly build of 6 million barrels of crude.

The Energy Information Administration will report its figures on Thursday, a day later than usual due to Monday’s federal holiday.

AT 07:00 AM ET (1200 GMT), U.S. crude futures traded 1.5% higher at $53.09 a barrel and the international benchmark Brent contract rose 1.5% to $58.56.

Additionally, gold futures rose 0.6% to $1,612.35/oz, pushing above the physiologically important $1,600 level and touching a seven-year high. EUR/USD traded at 1.0794, after pushing as low as $1.0785 for the first time since April 2017.

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