US pre-open: Futures mixed as oil prices surge on OPEC+ cuts

Wall Street futures were pointing to a mixed open ahead of the bell on Monday as the Dow Jones looks set to kick off the second quarter in the same manner it wrapped up the first.

As of 1220 BST, Dow Jones futures were up 0.32%, while S&P 500 and Nasdaq-100 futures had the indices opening 0.16% and 0.79% lower, respectively.

The Dow closed 415.12 points higher on Friday, extending gains recorded in the previous session as banking sector concerns showed further signs of easing.

Oil prices surged prior to the open on Monday, with West Texas Intermediate up 6.41% at $80.52 per barrel and Brent Crude 6.27% higher at $84.90 a barrel. The moves came hot on the heels of an announcement from Saudi Arabia and other OPEC+ members that they will make a voluntary cut of 5% of output - or around 500,000 barrels per day.

Monday's focus will be firmly on the US manufacturing sector, with the latest ISM PMI report being the key piece. The previous report showed economic activity in the manufacturing sector had contracted for a fourth consecutive month.

AJ Bell's Danni Hewson said: "The world needed a spike in oil prices like a hole in the head. Just as one of the pinch points in the global economy had started to ease, Saudi Arabia and its counterparts in OPEC have unveiled a surprise output cut. The decision by the oil producers’ cartel, unusually taken outside of any officially scheduled meeting, represents a flexing of its muscles and potentially a pre-emptive move as it anticipates a drop-off in crude demand relating to the collapse of SVB and ensuing banking crisis.

"Manufacturing PMI figures from the US later today and jobs numbers at the end of the week will be closely monitored as investors seek to work out what exactly the Federal Reserve is going to do when confronted with this mess."

On the macro front, S&P Global's Mach manufacturing PMI will be published at 1345 BST, while the Institute for Supply Management's manufacturing PMI and February construction spending figures will follow at 1400 BST.

No major corporate earnings were slated for release on Monday.

Reporting by Iain Gilbert at Sharecast.com