US pre-open: Stocks seen higher despite weaker oil prices

US stocks looked set for a positive open on Thursday, with the S&P 500 on track to open at record levels, despite a drop in oil prices.

At 1130 BST, Dow Jones Industrial Average and S&P 500 futures were up 0.3%, while Nasdaq futures were 0.4% higher. On Wednesday, the S&P 500 closed at a record, while the Dow and the Nasdaq closed at their second-highest levels ever after minutes from the latest Federal Reserve meeting showed most members were in favour of a rate hike soon as long as the economy continues to rebound from first-quarter weakness.

The minutes also suggested the central bank members were in agreement on how the Fed can unwind its $4.5trn balance sheet. It's understood the Fed will implement caps on how much it will allow to drop off the balance sheet without reinvestment each month.

Meanwhile, oil prices gave up their earlier gains to trade lower after OPEC members agreed to extend an earlier 1.8m-barrel-a-day production cut by nine months, although Saudi Arabian oil minister Khalid al-Falih said any deeper cuts were unnecessary. West Texas Intermediate was down 1.7% to $50.50 a barrel and Brent crude was 1.5% lower at $53.14.

Oanda analyst Craig Erlam said: "Brent and WTI got crushed earlier as energy ministers from within OPEC suggested that an extension will be agreed and will likely be at the same levels for six or nine months. It’s been a classic case of markets buying the rumours and selling the facts. It would appear a nine month extension with the potential for deeper cuts was almost fully priced in so when the statements were made, there was nowhere left for prices to go but lower.

"We’ve seen this kind of action time and time again. Traders buy on anticipation of the deal and when its delivered as expected, they take their profits and run. The unwinding of the positions, probably combined with some speculative selling, is what creates this sudden plunge."

On the corporate front, HP Inc was higher in pre-market trade after posting better-than-expected quarterly results late on Wednesday.

Dollar Tree, Signet Jewelers, Best Buy and Medtronic were among the companies slated to report earnings before the open.

On the macroeconomic calendar, initial jobless claims are scheduled for release at 1330 BST, along with wholesale inventories and the goods trade balance. Meanwhile, Fed Governor Lael Brainard is due to make a speech in Washington at 1500 BST.