US Markets

Futures lower; Fed, oil eyed

US futures set for modest gains
VIDEO1:1401:14
US futures set for modest gains

U.S. stock index futures pointed to a mixed open on Monday, as oil prices dipped and traders mulled more hints of near-term monetary policy tightening.

German drugs giant, Bayer, has bid $122 per share for Monsanto in an all-cash deal that values the U.S. company at $62 billion, according to a statement on Monday.

WTI crude oil futures for July traded about 1 percent lower below $48 per barrel on Monday, having fallen as low as $47.67 in overnight trade.

Stock watch

Speeches from the U.S. Federal Reserve's James Bullard and John Williams will be scrutinized on Monday for suggestions that an interest rate hike could take place in June.

Bullard said in a speech that a tight labor market may put upward pressure on U.S. inflation, supporting the case for higher rates.

Separately, Williams said he expects two to three rate hikes this year and three to four next year.

Treasury yields edged off lows, with shorter-end Treasury yields turning higher. The U.S. dollar index turned mildly higher, with the euro near $1.120 and the yen near 109.45 yen against the greenback as of 8:24 a.m. ET.

Corn plants growing in a greenhouse at the Monsanto Chesterfield Village facility in Missouri.
Daniel Acker | Bloomberg | Getty Images

"It is clear that the Fed is ready to move again soon. And if expectations of a June hike continue to build, the Fed may well take the opportunity to take another step towards normalization next month without fear of surprising the markets," Alex Holmes, economist at Capital Economics, said in a report on Friday.

Eric Rosengren, the president of the Federal Reserve Bank of Boston, told the Financial Times newspaper over the weekend the U.S. was on the verge of meeting most economic conditions for an interest rate hike.

On Friday, the Dow Jones industrial average posted its first four-week losing streak since 2014.

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Outside the US

U.S. President Barack Obama announced on Monday that Washington would completely lift the embargo on sales of lethal weapons to Vietnam.

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