U.S. Futures Add Early Gains As Eyes Turn To UK Referendum

U.S. Futures Add Early Gains As Eyes Turn To UK Referendum

U.S. stock markets moved higher during the premarket session, reflecting the general yet guarded optimism that the UK is less likely to exit the European Union. In early hours, S&P 500 INDEX (INDEXCBOE:SPX) Futures edged higher by 0.08% to 2,082.25 and NASDAQ (INDEXNASDAQ:NDX) Futures climbed 0.13% to 4,406.12.

Referendum driving markets

The U.K. referendum remained a dominant factor to influence market moves across the globe. Asian markets finished mixed, while most traders in Europe were positive about Britain’s continuing in the EU. Recent opinion results show a close call between the remain and leave campaigns, which is why analysts caution investors to remain alert before the outcome.

Meanwhile, the British pound continues to trade near six-month highs but stares at a steep cliff if Britain exits the EU. According to several analysts, the pound could test a level below $1.30 on Brexit. The day marks the third session in a row when the pound climbed as investors increasingly factor in Bremain.

Market discounts July rate hike

U.S. Dollar (CURRENCY:USD) erased early day gains as the market moved past Federal Reserve Chair Janet Yellen’s comments. Yellen had reiterated that rate hikes will take place in a gradual manner, however, she steered away from specifying a timeframe. After her dovish comments, markets have discounted any July rate hike from the equation. However, the dollar slump failed to move SPDR Gold Trust (ETF) (NYSEARCA:GLD) as UK referendum weighed over other factors in play. Analysts warn that any unexpected Brexit outcome could lead to bigger profits in safe-haven assets.

Oil traders brushed aside referendum concerns to cheer the American Petroleum Institute’s report, released yesterday. A steep fall in U.S. crude reserves sent West Texas Intermediate Crude oil above $50. The U.S. Energy Information Administration’s weekly report on oil will be a key focus for traders later today as a decline of 1.7 million barrels is eyed.