U.S. Stocks Likely To Open Higher As Oil Tests Level Above $50

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Optimism across global markets and rallying iPath S&P GSCI Crude Oil Total Return (NYSEARCA:OIL) prices have driven U.S. stock futures trading higher during early morning today. NASDAQ (INDEXNASDAQ:NDX) Futures rose 0.20% to 4,483.62 and S&P 500 Index (INDEXCBOE:SPX) gained 0.14% to 2,090.25.

Oil off 13-year lows

Brent Crude tested level above $50 for the first time in 2016, giving a boost to equities around the world. Oil outages and a significant fall in U.S. crude inventories were major reasons to bolster oil prices. During early European trade, Brent Crude registered gains around 0.80% to $50.14 while West Texas Intermediate surged 0.61% to $49.86.

Asian equities mostly advanced today. However, european bourses swung in between marginal losses and gains. Pressure around Spanish banks contributed to jittery sentiment. However, upbeat energy shares prevented market from extending deep losses.

Yellen’s comments will be significant

U.S. Dollar (CURRENCY:USD) booked some losses during the day as it moved away from its two-month high. Traders mostly covered their positions ahead of speech from the Federal Reserve President, Janet Yellen, tomorrow. Fed’s hawkish April minutes of the meeting as well as increasing assertions from Fed officials about looming rate hike has strengthened outlook for earlier monetary tightening policy.

Two day long Group of Seven Summit begun in Ise-Shima, Japan today. Concerns about the state of the global economy is believed to be focus of the meeting. Japan’s Prime Minister, Shinzo Abe, has already sounded alarm after he said that Lehman-scale crisis might re-emerge. G7 leaders are expected to reiterate their pledge towards bringing stability in the foreign exchange market.

SPDR Gold Trust (ETF) (NYSEARCA:GLD) prices gained but hovered near seven-week lows. Weak dollar opened a window for traders to cover short position in the commodity. However, any positive statement by Fed Chair, Yellen, tomorrow, is likely to reverse today’s gains.

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