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Stocks - U.S. Futures Rise on Rate Cut Hopes, Oil Bounce

Investing.com - U.S. futures rose on Thursday amid growing hopes that the Federal Reserve will cut interest rates, while energy stocks looked set for some relief as oil prices spiked in the wake of an attack on two oil tankers near the Persian Gulf.

In commodities, crude oil surged 2.9% to $52.66 a barrel after two oil tankers exploded in a suspected attack near the Strait of Hormuz, through which a fifth of global oil consumption passes. Exxon Mobil (NYSE:XOM) and Chevron (NYSE:CVX) were both indicated nearly 1% higher in premarket trade.

Traders have been speculating on the possibility of the Fed cutting rates due to slowing inflation and rising trade tensions after Fed Chair Jerome Powell signalled two weeks ago that the bank would “act as appropriate to sustain the expansion, with a strong labor market and inflation near our symmetric 2% objective.”

The yield on the United States 10-Year note fell 1.5 basis points to 2.11%, with expectations for a rate cut in July ticking higher to 88.1%, although the Fed is expected to keep rates steady at its next meeting June 19. Ten-year yields have collapsed from over 2.5% in May when trade talks between the U.S. and China started to unravel.

Dow futures rose 75 points or 0.3% by 6:46 AM ET (10:46 GMT), while tech-heavy Nasdaq 100 futures gained 35 points or 0.5% and S&P 500 futures was up 9 points or 0.3%.

Meanwhile on the trade front, President Donald Trump declined to set a deadline on increasing import tariffs on Chinese goods, insisting that the two countries would eventually make a deal but taking responsibility for the delay in the meantime.

“I have no deadline. My deadline is what’s up here,” he said, pointing to his head at a press conference on Wednesday.

Uber (NYSE:UBER) gained 0.9%, while Lyft (NASDAQ:LYFT) was up 0.9% in premarket trade after Evercore initiated coverage of the ride hailing companies at outperform, according to Investor’s Business Daily.

Facebook (NASDAQ:FB) rose 0.4% despite a Wall Street Journal report alleging that CEO Mark Zuckerberg may have known of the company’s questionable privacy practices.

Elsewhere, Lululemon Athletica (NASDAQ:LULU) jumped 6.5% after its first quarter earnings were better than expected, while Micron (NASDAQ:MU) was up 0.5% and Tesla (NASDAQ:TSLA) gained 0.8%.

Gold futures rose 0.2% to $1,339.75 a troy ounce, while the U.S. dollar index, which measures the greenback against a basket of six major currencies, was flat at 96.970.


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