Mixed Open Likely For US Markets; Oil Up

Mixed open likely for the U.S markets Tuesday after U.S. stock index futures were pointing in different directions.

Dow futures were up 19 points, in the morning, indicating a positive open of 32 points. But futures on the S&P and Nasdaq suggested a lower open.

Market participants are geared for another day of corporate earnings and data releases.

Corporate earnings on Tuesday will include many major tech companies. Companies reporting results will include Mastercard, Merck, Pfizer, McDonald’s, Apple and Mondelez International.

General Electric reported higher than expected first-quarter earnings and shares jumped 7 percent in pre-market trading. On the data front, employment costs index, pending home sales and consumer confidence numbers will be coming.

The Federal Reserve’s two-day policy meeting from Tuesday will hold clues on the central bank’s current thinking on the economy.

Oil up

Oil prices jumped on Tuesday after making up the earlier losses. The trigger was Saudi Arabia’s assertion that the deal to withhold output would go beyond June and may prevail for the entire 2019.

Saudi energy minister Khalid Al-Falih made this decision public despite President Donald Trump’s appeal to raise output to mitigate the supply shortfall from the tightening of U.S. sanctions against Iran.

Brent crude futures jumped 21 cents to $72.25 per barrel at 0701 GMT, from their last close.

U.S. West Texas Intermediate (WTI) crude futures gained 17 cents to touch $63.67 per barrel from their previous settlement.

Matt Stanley, a broker with Starfuels in Dubai said oil prices surged this year due to the “choking” of supply rather than strong demand.

Asia-Pacific shares mixed

Mixed trends prevailed on shares in Asia-Pacific after China data on manufacturing showed action below expectations. Trade negotiations between the U.S. and China will also restart in Beijing.

In mainland China markets, the Shanghai Composite moved up 0.5 percent and the Shenzhen component added 0.54 percent. Hong Kong’s Hang Seng index declined 0.6 percent at the final hour of trading. The China data on Tuesday showed its manufacturing activity was below expectations in April.

However, Kelvin Tay, regional CIO at UBS Global Wealth Management said growth in China is coming in, but it may take time before the cut in the VAT from 16 to 12 percent shows up.

In Europe, stocks were slightly down Tuesday morning, after China’s weaker manufacturing data ballooned concerns about global economic growth. The pan-European Stoxx 600 fell 0.2 percent during mid-morning deals with most sectors negative.

Gold up

Gold prices rose on Tuesday as lackluster Chinese factory data pulled down Asian shares, igniting concerns about the health of the global economy.

Investors are now looking forward to the U.S. Federal Reserve’s two-day policy meeting for clues on the interest rate outlook. Spot gold jumped 0.3 percent to $1,283.44 per ounce at 0731 GMT. U.S. gold futures were up 0.3 percent at $1,285.30 an ounce.