US pre-open: Oil rises boost stock futures

US stock futures were looking up before the market opened on Tuesday, as oil prices begin to climb again.

The Dow Jones Industrial Average is expected to open up approximately 146 points, while the S&P 500 and the Nasdaq are both set to begin the session 16.5 and 27.75 points higher respectively.

All eyes will be on the US Consumer Price Index for November, due out at 1330 GMT, as well as the real average weekly earnings for the month. The NAHB Wells Fargo Housing Market Index will also released at 1500 GMT.

Asia stocks fall as yuan rate cut

Elsewhere, Asia stocks fell on Tuesday as China’s central bank cut the yuan’s reference rate for the seventh consecutive day.

The Chinese yuan declined 0.03% to close at 6.4610 per dollar in Shanghai, taking its eight-day decline to 1%, according to CFETS prices.

The move comes amid speculation the central bank is guiding the currency lower to boost the slowing economy.

The PBoC on Friday tried to soothe markets by saying that the yuan’s performance shouldn’t be measured solely against the dollar.

The imminent Fed decision also had an impact on Asian markets.

Michael Hewson, senior market analyst at CMC Markets, noted that the Fed Funds Implied Probability indicator suggests that there is a 78% possibility of a rate increase and that there have been “clear signals” in recent weeks that US officials are preparing for such a move.

“It has also been suggested that the recent surprise decision by the European Central Bank to be more cautious about pushing extra stimulus into the financial system may have been rooted in concerns that too aggressive a move might well have caused the Fed to delay a move on rates,” he said.

“Policymakers will also have to weigh up any possible long term effects the recent decision by Chinese authorities to launch a new Yuan trade weighted basket could have on further deflationary forces in the global economy,”

European stocks powered ahead, bouncing back from losses in the previous session as oil prices recovered, with investors looking to the start of the Federal Reserve’s two-day policy meeting.

Oil prices started to rebound, with West Texas Intermediate crude was up 1.43% to $36.83, while Brent crude also rose 1.58% to $38.52 a barrel.

The dollar was down against the main currencies, dropping 0.08% and 0.02% on the pond and euro respectively but rising 0.05% against the yen, while spot gold rose 0.31% to $1,063.10.

In company news, FactSet Research Systems' first quarter revenues were up to $270.5m, but fell short of expectations.

3M is also expected to give its outlook for 2016 before the market opens, while there may be some trading activity at F5 Networks after it said late on Monday that its chief executive is resigning over “matters regarding personal conduct”.