U.S. stocks are deep in the red today during the premarket session, pointing to a widely lower opening. S&P 500 Futures Index (INDEXCBOE:SPX) plunged 0.32% to 2,035 and Nasdaq Futures Index (INDEXNASDAQ:NDX) lost 0.36% to 4,316.75.
Fed comes back to rate hike agenda
The Federal Reserve minutes released yesterday strongly indicated a possibility of a rate hike in June, which unsettled Street. A series of data reported over the past months had made markets believe that monetary tightening was not anytime near. However, the minutes have displaced such notions.
Later today, markets will closely follow comments from key Fed officials, which include Fed Vice Chair Stanley Fischer, and New York Fed President William Dudley. Alongside this, weekly jobless claims data scheduled to release today will be significant for markets.
Both Asian and European markets traded broadly lower while sinking oil prices also added to woes. Even a robust pick up in U.K. retail sales failed to lend support to European equities. The Office for National Statistics (ONS) said that retail sales were 1.3% higher in April than March. These numbers came despite sluggish growth in clothing sales due to unseasonable weather.
Like equities, oil prices also tumbled as a stronger dollar eroded sentiment. Moreover, a report by the U.S. Energy Information Administration informing that U.S. crude inventories rose during the previous week had offset hopes of a declining glut. Resultantly, oil prices dipped below $48 per barrel, off from their seven-month highs.
EIA reported that U.S. crude stockpiles grew 1.31 million barrels in the previous week to 541.3 million. Such an increase was not anticipated by market analysts, who had projected a fall of 2.833 million barrels.
In metals, demand for gold appeared feeble as a stronger dollar and rate hike speculations forced the commodity to trim its gains.