The Tuesday Market Minute
- Wall Street futures mixed as Boeing continues to drag Dow lower while broader benchmarks get a boost from last night's Brexit breakthrough.
- UK Prime Minister Theresa May secures legal clarification on Breixt deal from European Commission ahead of make-or-break Parliamentary vote later today in Lodnon.
- Australia and Singapore add to growing list of nations that have grounded Boeing's 7373 Max 8 after Sunday's deadly crash in Ethiopia.
- Global oil prices extend gains, taking U.S. crude near three-month highs, as Saudi Arabia trims output and the U.S. dollar weakens amid improved market sentiment.
- Dow called 15 points lower as Boeing takes 55 points from the average ahead of February inflation data at 8:30 am Eastern Time.
U.S. stocks are looking to book their first day of back-to-back gains in more than a week Tuesday as global investor sentiment gets a boost from last night's breakthrough in Brexit talks, less than twenty four hours ahead of a crucial Parliamentary vote in London, as investors continue to bet on the strength of the domestic economy.
U.K. lawmakers will vote on Prime Minister Theresa May's freshly-agreed Brexit deal later today after she secured legal assurances from European Commission President Jean-Claude Juncker linked to the so-called Irish backstop, a portion of the agreement that prevents a hard border between the Republic of Ireland, an EU member state, and Northern Ireland, a U.K. territory.
May's opponents, however, are waiting to hear an assessment on the changes from U.K. Attorney General Geoffrey Cox before voting later this evening, and victory for the Prime Minister -- who suffered the biggest defeat in Parliamentary history for the same deal in January -- is far from assured.
Still, with all sides inching towards a conclusion that prevents a so-called Hard Brexit later this month, a major risk event for the global economy, investor sentiment improved markedly in overnight trading, lifting stocks in Asia and supporting European markets, and regional currencies, throughout much of the morning sessin.
U.S. equity futures, however, as indicating a cautious start to the trading session on Wall Street, with contracts tied to the Dow Jones Industrial Average suggesting a 14 point pullback and those linked to the S&P 500 guiding to a 2.9 point bump for the broader benchmark.
The Dow continues to be influenced by shares of Boeing, one of the average's heaviest weights, as the planemaker struggles to find support from aviation officials after Sunday's deadly crash of a 737 Max 8 in Ethiopia.
Australia and Singapore joined a growing list of countries around the world that have grounded the Max 8, while the Federal Aviation Administration issued a "continued airworthiness notification" to international operators of the Max 8, adding that if the FAA "identifies an issue that affects safety" it will "take immediate and appropriate action.
Airworthiness Directives are legally enforceable regulations used to correct unsafe conditions in an aircraft, its engine, propeller or its appliances, according to the FAA website. There are around 350 737 Max 8s in service being flown by 54 operators around the world, according to FAA estimates.
Boeing shares were marked 2.1% lower in pre-market trading Tuesday, indicating an opening bell price of $391.75 each, a move that pulls around 55 points from the Dow.
Away from equities, the U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.16% lower at 97.05 as the pound booked solid gains on last night's Brexit breakthrough and the European single currency bounced from multi-year lows amid the improved market sentiment.
The dollar's weakness, as well as comments from Saudi Arabia energy officials that suggested the Kingdom's April crude exports will remain below 7 million barrels per day, while output falls shy of 10 million barrels per day, allowed oil prices to extend gains in early Tuesday trading ahead of the American Petroleum Institute's private sector reading of U.S. stockpiles later this afternoon.
Brent crude contracts for May delivery, the global benchmark, were marked 69 cents higher from their Monday close and changing hands at $67.27 per barrel while WTI contracts for April were seen 54 cents higher at $57.33 per barrel.