Investing.com - U.S. stock futures pointed to a lower open on Wednesday, putting the market on track to extend the prior day’s decline, as investors looked ahead to key U.S. data later in the day for more clues on the Federal Reserve’s next move.
The blue-chip Dow futures shed 62 points, or 0.35%, by 10:45GMT, or 6:45AM ET, the S&P 500 futures dipped 7 points, or 0.33%, while the tech-heavy Nasdaq 100 futures declined 12 points, or 0.25%.
Wall Street ended mostly lower on Tuesday as sliding oil prices hurt energy-related shares and a raft of disappointing economic data dampened demand for riskier assets.
The U.S. Institute of Supply Management is to release data on May manufacturing activity at 14:00GMT, or 10:00AM ET, Wednesday. The gauge is expected to inch down 0.3 points to 50.5. Anything above 50.0 signals expansion. Other data scheduled for release Wednesday include May auto sales, April construction spending and the Fed's Beige Book.
The U.S. dollar pulled back from a two-month high against a basket of major currencies, as investors reconsidered whether the Fed will raise interest rates in the coming months. The dollar index was down 0.3% at 95.54, moving further away from Monday’s two-month peak of 95.96.
Odds of a Fed rate hike for June stood at nearly 23% Wednesday morning, compared to 28% a day earlier, while the chance of a July hike held around 60%, according to CME Group's (NASDAQ:CME) FedWatch tool. September odds were at about 62%.
Meanwhile, oil prices were under pressure as market players looked ahead to a key meeting of major oil producers later this week. The Organization of the Petroleum Exporting Countries will meet on Thursday in Vienna although no dramatic announcement on a production cut is expected.
U.S. crude was down 74 cents, or 1.51%, to $48.36 a barrel during morning hours in New York, while Brent slumped 77 cents, or 1.54%, at $49.12.
Among active pre-market movers, shares of Alibaba (NYSE:BABA) lost 3% after Japan's Softbank (T:9984) said it will sell at least $7.9 billion in shares. The transaction will bring Softbank’s stake in the Chinese e-commerce giant to about 28% from nearly 32%.
Under Armour (NYSE:UA) saw shares decline 4% after the athletic apparel brand said it will take an impairment charge of about $23 million during the second quarter to reflect the shuttering of retailer Sports Authority.
Also on the downside, Nike (NYSE:NKE) tumbled almost 5% after both Morgan Stanley (NYSE:MS) and Bank of America (NYSE:BAC) downgraded the stock from overweight to equal-weight.
Companies slated to release quarterly earnings ahead of Wednesday’s opening bell include Michael Kors (NYSE:KORS), Cracker Barrel (NASDAQ:CBRL) and Vera Bradley (NASDAQ:VRA), while Box (NYSE:BOX) and Analogic (NASDAQ:ALOG) will post numbers after Wall Street closes.
Elsewhere, European and Asian stock markets struggled Wednesday, after lackluster Chinese manufacturing data prompted worries about the health of the world’s second largest economy.
The official China manufacturing purchasing managers' index came in at 50.1 in May, unchanged from a month earlier. Meanwhile, the Caixin manufacturing purchasing managers’ index fell to 49.2 last month, contracting for the 15th straight month.
The disappointing data reinforced the view that the economy remains in the midst of a gradual slowdown which will require Beijing to roll out more support in coming months.