US pre-open: Stocks seen firmer as rate hike expectations grow
US futures pointed to a firmer open on Wall Street on Wednesday amid rising expectations of an interest-rate hike in the coming weeks, as investors looked to a raft of economic releases and more Fed speak.
At 1130 GMT, Dow Jones Industrial Average and S&P 500 futures were up 0.4% and 0.5%, respectively, while Nasdaq futures were 0.6% higher.
Meanwhile, oil prices nudged higher, with West Texas Intermediate up 0.2% to $54.13 a barrel and Brent crude up 0.3% to $56.59.
Oanda's Craig Erlam said: "What’s helping to maintain the upbeat sentiment is the optimism coming from within the Fed. Not so long ago the market feared the mere prospect of a single rate hike but now they’re taking the prospect of three comfortably within their stride.
"Perhaps the promise of more activity on the fiscal side combined with evidence of a much improved labour market is helping allay the fears that previously held the market back."
On Tuesday, Federal Reserve President William Dudley said the case for an interest rate rise had become "a lot more compelling", while San Francisco Fed President John Williams said on CNN that a hike was "on the table for serious consideration" at the next Fed meeting in March.
Meanwhile, Dallas Fed President Robert Kaplan said in an interview with CNBC that a rate hike would be best "sooner rather than later".
The comments boosted the dollar and pushed market implied odds of a rate hike in mid-March as high as 70% at one point on Tuesday evening, before they fell back to around 50%.
Investors will also be mulling over Trump's first address to Congress on Tuesday, in which he struck an upbeat but measured tone, saying he was open to a broad immigration reform bill but remaining low on details when it came to his economic plans.
Fed speak will continue to be eyed on Wednesday, with Kaplan and Fed Governor Lael Brainard among those due to make speeches.
In corporate news, Office Depot and Best Buy were scheduled to report earnings before the opening bell.
AMC Entertainment Holdings nudged lower in pre-market trade after chief executive Adam Aron said he expects blockbuster 2017 revenue, but the company posted a 20% drop in profit.
Weight Watchers International surged after its quarterly earnings late on Tuesday beat analysts' expectations.
On the data front, personal consumption expenditures figures are at 1330 GMT, while Markit's manufacturing PMI is at 1445 GMT and ISM Manufacturing PMI is at 1500 GMT, along with construction spending.