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Wednesday's market is watching housing but thinking Fed

Oil inventory data could be an important factor for all markets Wednesday as traders await the 10:30 a.m. EDT government release to see if inventories built as much as another report suggested.

API late Tuesday showed a surprise build of 4.5 million in crude inventories when the market expected a draw. That helped reverse some of the gains made during Tuesday's session on reports that Iran would join OPEC talks in Algiers next month.

If oil makes a strong move after the report from the Energy Information Administration it could have follow on impact on equities. West Texas Intermediate crude futures were down 2 percent at about $47.13 per barrel in early Wednesday trading.

Platt's expects a build of 200,000 barrels of crude and it expects gasoline stocks to draw down by 1.6 million barrels. The firm said severe flooding on the U.S. Gulf Coast impacted the region's refineries last week, causing disruptions, and that likely contributed to a draw in U.S. gasoline stocks.

It also expects refinery utilization to decrease 0.6 percentage points.

After Tuesday's surprise pop in new home sales, existing home sales Wednesday should be a focus, as traders countdown to Friday's speech by Fed Chair Janet Yellen.

At the same time, the stock market is flirting with new all-time highs. The Nasdaq hit a new intraday high Tuesday, but closed beneath it at 5,260.08, and traded just below its all-time high. The S&P 500 ended the day at 2,186, up 4 points. Stock futures were slightly higher Wednesday.

New home sales Tuesday jumped 12.4 percent to 654,000. Goldman Sachs economists said they increased tracking GDP for the third quarter by one-tenth to 2.5 percent because of the strength in home sales, now back to 2007 levels.