US pre-open: Stocks set for more gains as oil rallies

US stocks looked set to hit fresh record highs on Tuesday as the oil price rally underpinned sentiment.

At 1120 GMT, Dow Jones Industrial Average and S&P 500 futures were up 0.3%, while Nasdaq futures were 0.4% firmer.

On Monday, US equity markets racked up healthy gains, with the Dow Jones Industrial Average, the S&P 500 and the Nasdaq all closing at record highs.

Meanwhile, oil prices were in the black amid hopes that next week’s OPEC meeting will see member states and non-OPEC Russia agree a production cut. On Tuesday, a Nigerian delegate said at a two-day technical meeting between delegates that the cartel was likely to reach a deal to cut output.

West Texas Intermediate was up 1.5% to $48.94 a barrel and Brent crude was 1.8% higher at $49.76

In currency markets, the dollar was flat versus the euro and the yen but 0.4% firmer against the pound.

Jamieson Blake, retail sales manager at ADS Securities London, said: “Growing confidence that a deal will be struck in Vienna next week by OPEC members to cut production is serving to push oil prices higher and this is driving a swathe of confidence through equity markets. On top of this, Donald Trump has confirmed that he will instruct the US to withdraw from the Trans Pacific Partnership on his first day in office, a move that could stand to bolster the fortunes of US businesses at least in the short to medium term, giving investors more to cheer.

“As a result we’re looking at fresh gains on major US indices at the open and there appears to be little out there in the way of economic data that has the potential to derail this sentiment. The key release is set to be US existing home sales due shortly after the opening bell and the potential risk here would be a marked slow down, calling into question the Fed’s ability to hike interest rates as predicted next month – something that in turn would be seen as positive for stocks.”

In corporate news, cyber-security company Palo Alto Networks tumbled in pre-market trade as it reported late on Monday that quarterly revenue growth slowed.

Dollar Tree, Campbell Soup and Barnes & Noble were among the companies slated to report earnings before the opening bell.

On the data front, existing home sales are at 1500 GMT.