US pre-open: Stocks seen touch higher with Fed still in focus

US futures pointed to a slightly firmer open on Wall Street in a rebound from Monday’s declines, although the focus is expected to remain firmly on the Federal Reserve and the timing of the next rate hike.

At 1117 BST, Dow Jones Industrial Average, S&P 500 and Nasdaq futures were all 0.3% higher.

In Europe, the main indices were firmly in the black, reversing opening losses as financials put in a strong performance.

Meanwhile, over in Asia, shares fell as investors continued to worry about the possibility of a US rate hike as early as June and as weaker commodity prices weighed.

At the same time, oil prices were in the red as the dollar gained some ground. West Texas Intermediate was down 0.2% to $47.98 a barrel and Brent crude was 0.4% lower at $48.17.

A stronger greenback makes dollar-denominated commodities more expensive for holders of other currencies.

Societe Generale strategist Kit Juckes said: “The odds of a June Fed rate hike have risen to 30% according to Bloomberg, but the vast majority of people I speak to think the UK’s EU membership referendum will be enough to stay the Fed’s hand.

“For those tempted to look for an early move, July is the favourite, and the odds there, have increased to above 50%. I should add that SG’s US economics team doesn’t share that view, expecting a Q4 move, but the contrast with the UK where the chances of a July hike (pot-referendum, remember) remain firmly at zero.”

In corporate news, Toll Brothers was likely to be in focus after reporting better-than-expected second-quarter profit and revenue ahead of the open.

Results are still due from Best Buy before the opening bell.

On the data front, new homes sales figures for April are due at 1500 BST. They are expected to show a rise to 521,000 from 511,000.