US STOCKS-Wall St edges higher on oil jump, tech still soft - Reuters News
20-Mar-2018 10:20:19 PM
• Facebook shares under pressure for second day
• Oracle slumps as Q3 cloud business disappoints
• FOMC meeting kicks off on Tuesday, policy guidance eyed
• Indexes up: Dow 0.3 pct, S&P 0.02 pct, Nasdaq 0.03 pct
Updates to open
By Sruthi Shankar
March 20 (Reuters) - U.S. stocks inched higher on Tuesday with energy stocks leading the way thanks to a jump in oil prices but technology stocks remained on the defensive after the previous day's bruising selloff.
Oil rose to its highest level so far this month, lifted by tension in the Middle East and the possibility of further falls in Venezuelan output.
That helped push the S&P energy index up 0.9 percent.
S&P 500 technology stocks after a fleeting advance at the opening bell, were back modestly in the red, adding to Monday's steep losses when Facebook Inc's data privacy issues hit the sector.
Investors are also focused on the Federal Reserve's two-day policy meeting where it is expected to raise interest rates by a quarter percentage point. But the bigger question is how aggressive the U.S. central bank will be with monetary policy after that.
Traders currently expect two more rate hikes later this year, although they said policymakers could set a hawkish tone by forecasting four increases in their "dot plot" projections.
The past nine years of U.S. stock market gains have come with the Fed fostering an environment of easy money for the financial system, but it has begun gradually withdrawing that accommodation as the economy appears to be on healthier footing. Few economists expect new Fed chair Jerome Powell to alter the trajectory of the bank's anticipated rate path, but as it is his first meeting at the helm, investors have been somewhat on edge as the meeting approaches.
Aside from the Fed, the Trump administration is creating a stir with plans for up to $60 billion in new tariffs on Chinese imports by Friday, targeting technology, telecommunications and intellectual property, sources familiar with the matter told Reuters.
"There's much more volatility in this marketplace and that's because there two main fears - monetary policy mistake and trade policy mistake and on backdrop is a lot of chaos that comes out of White House," said Art Hogan, chief market strategist at B. Riley FBR in Boston.
At 10:14 a.m. ET, the Dow Jones Industrial Average was up 0.34 percent at 24,694.22. The S&P 500 gained just 0.07 percent to 2,715 and the Nasdaq Composite rose 0.1 percent to 7,351.60.
Shares of Facebook, which instigated the rout, were down 2.5 percent, adding to a 6.8 percent decline on Monday on reports that its users' data was misused.
Chief Executive Mark Zuckerberg faced calls from both U.S. and European lawmakers demanding explanations and fears of increased regulation on how companies use data had sent shares of other internet stocks down as well.
Oracle was the biggest percentage decliner on the S&P 500, falling 9 percent after the business software maker reported quarterly revenue that missed Wall Street estimates on disappointing sales from its cloud business.
(Reporting by Sruthi Shankar in Bengaluru; Editing by Savio D'Souza and Dan Burns)
UPDATE 6-Oil rises to March high on Middle East tensions, Venezuela concerns - Reuters News
20-Mar-2018 10:01:02 PM
• Geopolitics not fundamentals lift prices - analyst
• Relentless rise in U.S. crude output caps gains
• Economic crisis halves Venezuelan output since 2005
Updates with comment, refreshes prices
By Amanda Cooper
LONDON, March 20 (Reuters) - Oil rose on Tuesday to its highest level so far this month, as tension in the Middle East and the possibility of further falls in Venezuelan output helped offset the negative impact of growing U.S. crude production.
Brent crude futures rose $1.22 on the day to $67.27a barrel by 1343 GMT, their highest level since late February. U.S. West Texas Intermediate (WTI) May crude futures rose $1.19 to $63.32 a barrel.
"The move today is more to do with geopolitical tensions than underlying fundamentals, but I don't expect that to last," PVM Oil Associates strategist Tamas Varga said.
Saudi Arabia called the 2015 nuclear deal between Iran and world powers a "flawed agreement" on Monday, on the eve of a meeting between the Saudi crown prince and U.S. President Donald Trump. Both are highly critical of Iran.
Trump has threatened to withdraw the United States from the accord between Tehran and six world powers, raising the prospect of new sanctions that could hurt Iran's oil industry.
"Tensions between Saudi Arabia and Iran gave prices some support," Sukrit Vijayakar, director of energy consultancy Trifecta, said in a note.
Worries about falling production in Venezuela, whose output has been halved since 2005 to below 2 million barrels per day (bpd) due to an economic crisis, also supported oil markets.
The International Energy Agency said last week Venezuela was "vulnerable to an accelerated decline" and said such a disruption could tip global markets into deficit.
PVM's Varga said Venezuela was a potential source of supply disruption, but he said the bigger challenge for OPEC and its allies was ensuring their efforts to balance the market through output curbs was not undermined by rising production elsewhere.
Output has climbed sharply in the United States, Canada and Brazil, as they ramp up production to benefit from higher crude prices that have been buoyed by the cuts made by the Organization of the Petroleum Exporting Countries, Russia and their allies. The production rise has capped oil price gains.
Appetite for U.S. crude is adding to the headache facing OPEC. A widening discount of WTI to Brent crude makes it more attractive for foreign refiners to process U.S. oil. Brent is the benchmark for several Middle East and other global crudes.
"Oil prices have appreciated as continued tensions in the Middle East stimulated concerns over potential supply disruptions," said Lukman Otunuga, a research analyst at FXTM.
"While news of the United States potentially re-imposing sanctions on Iran could fuel the current upside, growing fears of rising U.S production are likely to create headwinds for bulls down the road."
The premium of Brent crude to WTI rose above $4 a barrel on Tuesday, its widest in a month.
(Additional reporting by Henning Gloystein in Singapore
Editing by Edmund Blair)
CBOT Trends-Wheat up 3-5 cents, soybeans up 1-2, corn steady-down 1 - Reuters News
20-Mar-2018 09:28:12 PM
CHICAGO, March 20 (Reuters) - Following are U.S. trade expectations for the resumption of the grain and soy complex trading at the Chicago Board of Trade at 8:30 a.m. CDT (1330 GMT) on Tuesday.
WHEAT - Up 3 to 5 cents per bushel
• Technical bounce after Monday's sharp sell-off, which was tied to much-needed moisture in the dry U.S. Plains winter wheat belt, along with fund long liquidation. The CBOT May contract dipped to a seven-week low at $4.50 a bushel in early moves, and K.C. May hard red winter wheat dipped to $4.69.
• The USDA late Monday rated 11 percent of the Kansas winter wheat crop in good to excellent condition, down from 12 percent one week earlier.
• CBOT May soft red winter wheat last traded up 3-1/2 cents at $4.54-1/4 per bushel. K.C. May hard red winter wheat was last up 3-1/2 cents at $4.73-3/4 and MGEX May spring wheat was last up 5 cents at $6.01-1/2.
CORN - Steady to down 1 cent per bushel
• Corn steady to weaker, with the CBOT May contract matching Monday's three-week low of $3.74-3/4 ahead of the daily break in trade. Funds hold a large net long position in CBOT corn, leaving the market open to bouts of long liquidation. Worries about the impact of a trade war on U.S. grain demand hang over the market.
• The USDA said private exporters sold 110,000 tonnes of U.S. corn to Peru for delivery in the 2017/18 marketing year.
• CBOT May corn CK8 last traded down 1/4 cent at $3.74-3/4 a bushel.
SOYBEANS - Up 1 to 2 cents per bushel
• Soybeans higher on a technical bounce a day after the CBOT May contract hit a one-month low at $10.21-3/4 a bushel. Expectations of an expansion in U.S. plantings this spring hang over the market, limiting rallies, along with concern about the impact of a trade war.
• U.S. agricultural exports could be at risk in any retaliation over tariffs implemented by the White House, U.S. Secretary of Agriculture Sonny Perdue said on Monday.
• CBOT May soybeans last traded up 1 cent at $10.23-1/2 per bushel.
(Reporting by Julie Ingwersen)
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