Business

With $ 110 worth of oil, stock futures are rising in Powell ahead of OPEC

U.S. stock futures plummeted as oil prices soared as Russia hit Ukrainian cities and investors waited for a meeting with Federal Reserve Chairman Jerome Powell and the Organization of the Petroleum Exporting Countries and his allies.

S&P 500 futures rose 0.1% on Wednesday, down from a benchmark 1.6 days a day later. Contracts for the Dow Jones Industrial Average rose by 0.2% and those for the technology-based Nasdaq-100 by 0.1%.

In pre-market trading, Exxon Mobil’s shares rose 2.3% after it said it was stopping operations in a multi-million dollar oil and gas project in Russia. Hewlett Packard Enterprise raised its annual earnings forecast, and shares rose 4% ahead of the bell.

In Europe, the Stoxx Europe 600 was close to the pan-continental line.

Shares have been volatile in recent weeks. Investors are responding to the rapid evolution of the Ukrainian war zone, a wave of sanctions imposed by the West on Moscow in Moscow, and a series of major companies severing ties with Russia. With rising energy prices, the conflict has heightened uncertainty over rising interest rates this year.

Energy markets made rapid progress on Wednesday. Crude oil prices have risen by more than $ 110 a barrel since 2014 as refineries refused to buy Russian oil, removing a bite from the world’s energy supply. The future of Brent crude, an international benchmark, rose 5.8% to $ 111.03 a barrel, and this year it has risen to 43%.

Prices jumped on the pockets of other energy-related markets in Russia. European natural gas prices rose by 30%. So far, there has been a small disruption in Ukraine’s gas pipeline, which accounts for about a third of Russia’s gas exports to Europe, according to analysts.

Allies led by OPEC and Russia are scheduled to meet on Wednesday. Analysts expect production to continue with a plan to raise 400,000 barrels a day, even as many members of the cartel are struggling to meet their quotas.

A trader worked on the floor of the New York Stock Exchange on Monday.


Photo:

Michael Nagle / Zuma Press

Rising oil prices are causing headaches for central banks, which are facing the fastest inflation rates in decades. Mr. Powell will begin his first day of testimony on monetary policy and economics before appearing before the House Financial Services Committee at 10 a.m. ET.

The benchmark 10-year Treasury yields rose to 1.732% before Mr Powell’s testimony, from 1.708% on Tuesday. Yields and bond prices are moving in opposite directions.

Lawmakers are likely to put pressure on Mr Powell on the pace of rate hikes, inflation forecasts and the economic impact of Russia’s invasion of Ukraine. The Fed is expected to raise interest rates at its March 15-16 meeting.

However, traders have dismissed expectations that the Fed will raise rates several times this year since Russia invaded Ukraine on Thursday. Banks set the price at the end-of-year benchmark rate of 1.75% or higher, according to the CME Group, down from 54% a week ago.

Write to Joe Wallace at joe.wallace@wsj.com

Copyright © 2022 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8

With $ 110 worth of oil, stock futures are rising in Powell ahead of OPEC

Source link With $ 110 worth of oil, stock futures are rising in Powell ahead of OPEC

Back to top button