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Futures Trade Lower as Oil Prices Rise

U.S. index futures traded lower ahead of the open Wednesday as the S&P 500 marked the two-year anniversary of the trough of the financial crisis.

The market appeared to be following oil prices after OPEC said it saw no reason to hold an emergency meeting to discuss raising output, but oil prices rose after a report that black smoke was rising from an oil terminalin Libya. London Brent crude rose more than 1 percent, above $114 a barrel, while U.S. light sweet crude rose above $105. Gold rose above $1,434, falling from the previous day's record high.

The S&P 500 has risen 95.4 percent since it bottomed at 676.53 on March 9, 2009 after hitting a peak of 1,565.15 on Oct. 9, 2007.

In U.S. economic news, the Mortgage Bankers Association's seasonally adjustedindex of mortgage application activity rose 15.5 percent in the week ended March 4, the highest level in three months.

Wholesale trade data for January will be released at 10 a.m. And the Treasury will auction $21 billion in reopened 10 year notes at 1 p.m.

Weekly Crude inventories are out at 10:30 am and will be watched closely by investors as worries about global oil supply persist.

Galleon Group founder Raj Rajaratnam goes on trial Wednesdayin a closely-watched Wall Street insider trading criminal case.

A jury of New Yorkers will hear U.S. prosecutors outlining how they believe Sri Lankan-born Rajaratnam broke the law by designing a complex web of stock tippers who helped him reap $45 million in illicit profit between 2003 and March 2009. If convicted he could face up to 20 years in prison. He denies any wrongdoing.

In stocks news, tech shares could weigh on Wednesday's market after fiber optic component maker tumbled more than 30 percent in after-hours trading Tuesday following a disappointing forecast.

That news hit other companies in the sector, including JDS Uniphase, which lost 13 percent after the bell.

Texas Instruments also lost ground in late trading after it narrowed its guidance and said that demand for chips for televisions remains weak.

Honeywell slipped despite issuing an improved forecast for first-quarter sales and profit. The diversified manufactuer reaffirmed its outlook for 2011, and said it authorized a $3 billion stock buyback.

HCA plans to go public Wednesday, with analysts expecting strong demand. The IPO could raise up to $3.7 billion.

Sovereign debt worries continued to weigh on the market in Europe ahead of a meeting of euro zone heads of state Friday.

Days after Moody’s cut its rating on Greek sovereign debt by three notches, Moritz Kraemer, head of sovereign credit ratings for Europe at Standard & Poor’s told Reuters the agency could also cut its rating on Greece and Portugal.

“We have Greece on a credit watch negative and …we will be watching what will come out of the European Council meeting this month,“ he said.

On the Calendar:

WEDNESDAY: Wholesale trade, oil inventories, 10-year Treasury note auction, BofA/ML consumer conf., Citi 2011 financial services conference, anniversary of S&P 500 closing low (2009); earnings before-the-bell from American Eagle Outfitters and after-the-bell from H&R Block.
THURSDAY: BoE announcement, international trade, jobless claims, quarterly services survey, 30-year Treasury bond auction, Treasury budget, money supply, Nasdaq peak anniversary; Earnings before-the-bell from Smithfield Foods and after-the-bell from National Semiconductor.
FRIDAY: Retail sales, consumer sentiment, business inventories, S&P index rebalancing info due, Apple's iPad 2 ships; earnings before-the-bell from Ann Taylor.

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