By Peter Nurse
Investing.com - U.S. stocks are seen opening mixed Wednesday, with technology stocks getting slammed as investors factored in a Democratic win in crucial U.S. Senate run-off elections in Georgia.
At 7:05 AM ET (1205 GMT), the Dow futures contract was up 84 points, or 0.3%, but the S&P 500 futures traded 7 points, or 0.2%, lower and Nasdaq 100 futures slumped 196 points, or 1.5%.
The official results in the runoffs for Georgia's two seats in the Senate have not yet been announced so far Wednesday, but U.S. TV networks have called one for Democrat Raphael Warnock over Republican Kelly Loeffler. In addition, election prediction services indicated that Jon Ossoff was on course to unseat Republican David Perdue in the other.
These votes are expected to be confirmed later Wednesday, and are seen as crucial in deciding whether President-elect Joe Biden enjoys full control of Congress or faces stiff opposition to his plans.
A win for the Democrat pair would likely result in more stimulus and tax hikes as well as potential policies to restrict the monopoly power of big tech companies, hence the selloff on Nasdaq.
Sticking with the tech sector, President Donald Trump signed an executive order Tuesday banning transactions with eight Chinese apps, including WeChat Pay and Alipay. This move is likely to ratchet up already high U.S.-China tensions, with only two weeks before President-elect Joe Biden takes office.
The economic data slate Wednesday offers a first look at the U.S. job market ahead of Friday's nonfarm payrolls. The ADP December jobs report is expected to show a gain of 88,000 jobs when it hits at 8:15 AM ET (1315 GMT), but some are predicting a negative number as the surge of Covid-19 cases caused many states to restrict activities.
Also on tap are Markit PMIs and factory and durable goods orders, while the minutes from the Federal Reserve’s December meeting are also due.
Oil prices gained Wednesday, continuing Tuesday’s strong tone after Saudi Arabia’s surprise decision to make additional production cuts of 1 million barrels per day in February and March.
U.S. crude oil inventories dropped by 1.7 million barrels in the week to Jan. 1, data from industry group the American Petroleum Institute showed on Tuesday. Official data is due later Wednesday.
U.S. crude futures traded 0.3% higher at $50.08 a barrel, while the international benchmark Brent contract rose 0.6% to $53.92. Both contracts climbed late Tuesday to their highest levels since February last year.
Elsewhere, gold futures fell 0.2% to $1,951.20/oz, while EUR/USD traded 0.3% higher at 1.2342.