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Dec 12, 2016

U.S. Stock Market Future Indications, by MarketWatch - December 12, 2016: Dow 20,000Within Sight, But Caution Over Fed Won't Make It Easy
Barbara Kollmeyer
An all-time high of 20,000 for the Dow industrials appeared tantalizingly close on Monday, though U.S. stock futures hinted at a struggle ahead as investors focused on an upcoming U.S. central bank meeting.

A rally for oil prices seemed to be having little or no effect on stock futures, as investors turned their focus to this week’s Federal Open Market Committee meeting. The U.S. dollar USDJPY, +0.34%  was trading at levels against the Japanese yen not seen since early 2016.
Dow Jones Industrial Average futures YMH7, +0.00%  rose 6 points to 19,717, while those on the S&P 500 index ESH7, -0.11%  slipped 1.7 points to 2,253. More weakness was seen for technology stocks, with Nasdaq 100 futures NQH7, -0.47%  futures off 20.50 points, or 0.4%, to 4,873.
The key stock markets closed at a record high on Friday, with the S&P 500 SPX, +0.59%  managing its best winning streak since June 2014. The index finished at a historic high of 2,259.53. The Nasdaq Composite closed at a high of 5,444.50.
Much investor attention is now focused on whether the Dow industrials DJIA, +0.72%  will make it to an all-time high of 20,000 as soon as Monday. The index closed at a record 19,756.85 on Friday, in a run for stocks that has left many analysts surprised. All three indexes, including the Nasdaq Composite COMP, +0.50%  gained over 3% for the week.
Read: Stock market’s velocity after Trump has Wall Street talking Dow 20,000 — and beyond
But some concerns about the upcoming Federal Reserve meeting were leaking into sentiment.
“The looming risk is Wednesday’s FOMC meeting — not so much the fact that we’ll see a quarter-point rate hike, as this is fully priced in anyway, but the idea that if we see a hawkish tone over the rate outlook for 2017, then this could be the catalyst that leaves traders reaching for the sell button,” Jamieson Blake, retail sales manager at ADS Securities, told clients in a note.
Read: Look for the Fed to hike interest rates and to ignore the elephant in the room
The Fed’s two-day meeting will wrap up Wednesday and is widely expected to result in a lift in the target range for its federal funds rate between 0.5% and 0.75%. That would be the first increase of 2016.
The economic docket is thin on Monday, with the only key report the Federal budget for November, due at 2 p.m. Eastern Time.
Oil soars on output deal: Energy-related names were gaining Monday after oil producers inside and outside the Organization of the Petroleum Exporting Countries struck a deal to reduce output by 558,000 barrels a day. Exxon Mobil Corp. XOM, +0.77%  advanced 1.4%, while Chevron Corp. CVX, +0.56%  put on 1.9%.
WTI crude prices CLF7, +4.04%  rose more than 4% after the meeting, while Brent crude LCOG7, +3.87%  added close to 4%.
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Analysts cheered the efforts, but some worry OPEC could have trouble keeping a deal with so many “moving parts” together. A specific concern is an increase in production by U.S. shale oil producers. A report from Baker Hughes Inc. BHI, +0.77%  Friday found that the number of active U.S. oil rigs drilling hit the highest level since January last week.
Stocks to watch: Aerospace major Boeing Inc. BA, +0.71%  could be active in premarket after landing a deal worth up to $16.6 billion to sell 80 jetliners to Iran
Shares of Apple Inc. AAPL, +1.63%  and Facebook Inc. FB, +0.65%  were among those moving lower in premarket, by 0.6% and 0.5%, respectively. Shares of Alibaba Group Holding Ltd. BABA, +1.05%  were off 1.1%.
See: Elon Musk to join Trump’s tech-industry summit in New York this week — WSJ
Other markets: European stocks SXXP, -0.39%  fell from an 11-month high as investors turned their focus to the Fed meeting.
The Shanghai Composite Index SHCOMP, -2.47%  logged its biggest daily drop since June, falling 2.5%, weighed by a crackdown by officials on stock purchases by insurance firms. Japan’s Nikkei 225 index NIK, +0.84%  rose 0.9%, boosted by weakness for the yen.
The dollar USDJPY, +0.34%  tapped ¥116 against the Japanese currency, nearing levels not seen since earlier in the year, according to FactSet Research. Gold prices GCG7, -0.33%  fell $4.30, or 0.4%, to $1,157.60 an ounce.