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Wall Street eyes oil as rebound fades

U.S. stock index futures are signalling a lower open on Wall Street on Wednesday, as a tentative rebound in oil prices fades.

Asian and European markets traded lower on Wednesday as oil prices declined, putting the brakes on a rally that had seen prices rise over 19 percent over the last four sessions.

The ADP Employment report, which is seen as a precursor to Friday's important jobs report, showed January payrolls increased by 213,000, below estimates of 225,000.

"Bottom line, job gains slowed, due in part to the energy sector but at more than 200,000, the monthly job gains still remain good, not great," Peter Boockvar, chief market analyst at The Lindsey Group, said in a note.

"Friday's payroll estimate for the private sector is 228,000 with an unchanged unemployment rate of 5.6 percent," he said. "But, with monthly job gains continuing at plus-200,000, the unemployment rate could be at the Fed's non-accelerating inflation rate of unemployment by the time they walk into their April meeting. If they aren't raising rates by June, they'll have some explaining to do, especially if commodity prices have stopped going down."

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U.S. investors will be watching for a further slew of earnings on Wednesday, with General Motors, GlaxoSmithKline, Merck, Toyota Motors, Clorox, Motorola Solutions, Ralph Lauren and Whirlpool reporting before the bell.

Earnings coming after the bell include Yum Brands, 21st Century Fox, Under Armour and Keurig Green Mountain.

On Wednesday, Sony said in its preliminary third-quarter results that operating profit had doubled to 178.3 billion yen ($1.52 billion), while sales rose 6 percent to 2.56 trillion yen in the October-December quarter, Reuters reported.

Total mortgage application volume increased 1.3 percent on a seasonally adjusted basis last week from one week earlier, according to the Mortgage Bankers Association.

Data out later in the morning include the PMI Services Index at 9:45 a.m. and the ISM Non-manufacturing Index at 10:00 a.m., which will also give indications on the state of health of the U.S. economy.

In addition, oil inventories data is published at 10:30 a.m. and the Cleveland Federal Reserve's President Loretta Mester speaks at 12:45p.m.

The oil data comes as U.S. crude futures traded by as much as over 3 percent lower on Wednesday before paring losses to trade around around $51.90 a barrel, while Brent crude for March delivery was down nearly 3 percent at $57.43 a barrel.

Oil prices have fallen around 50 percent from a high of $114 a barrel last June on the back of an over-supply and lack of demand.

This week's rebound sparked hopes that prices had hit a bottom after a seven-month rout, but growth concerns in China have prompted renewed concern for global oil demand.

China's services sector grew at the slowest pace in six months in January as growth in new business weakened, an HSBC services purchasing manager's index (PMI) showed Wednesday, Reuters reported.