CNBC: US stocks trade higher ahead of data; oil eyed
U.S. stocks traded slightly higher Tuesday as Wall Street awaited the release of economic data while keeping an eye on oil prices.
The Dow Jones industrial average traded about 50 points higher shortly after the open, with McDonald's contributing the most gains. The Nasdaq composite held about 0.1 percent higher. The S&P 500 held about 0.1 percent higher.
The ISM non-manufacturing PMI index for August is scheduled for release at 10 a.m. ET. Economists polled by Reuters expect the index to come in at 55.0, slightly below a July read of 55.5. A number above 50 indicates expansion, while one below 50 shows contraction.
Economic data has been high on investors' radars as the Street tries gauge whether the Federal Reserve will raise interest rates later this month. The Fed's policymaking committee is slated to meet September 20-21.
"Bottom line, it comes down to whether the Fed will focus on one piece of economic news (and thus continue to day trade the data) or are they backing away from their obsession with each individual figure in and of itself," Peter Boockvar, chief market analyst at The Lindsey Group, said in a Tuesday note to clients.
On Friday, investors digested a weaker-than-expected jobs report, which showed 151,000 were added in August, below a consensus estimate of 180,000.
"Many market participants, though, believe Janet Yellen will still pull the trigger in fifteen days based on recent remarks made by the Chairman and trusted sidekick Stanley Fischer," said Jeremy Klein, chief market analyst at FBN Securities.
Market expectations for a September rate hike were 27 percent, according to the CME Group's FedWatch tool.
Meanwhile, oil prices fell in morning trade, with U.S. crude erasing earlier gains, down 0.38 percent at $44.27 per barrel.
"I think the news we got about the Saudis and the Russians is important because it signals a possible [production] deal," said Peter Cardillo, chief market economist at First Standard Financial.
Saudi Arabia and Russia agreed on Monday to cooperate in world oil markets, but Saudi Energy Minister Khalid al-Falih said there was no need to freeze output for now.
While the Saudi minister played down the prospect of imminent action, his Russian counterpart Alexander Novak said he was open to ideas on what cut-off period to use if countries chose to freeze output and even said production cuts may be discussed.
WTI gained 7.45 percent last month.
U.S. Treasurys traded lower on Tuesday, with the two-year note yield at 0.786 percent and the benchmark 10-year note yield at 1.594 percent. The U.S. dollar fell about 0.2 percent against a basket of currencies, with the euro near $1.116 and the yen around 103.34.
Tuesday also saw a slew of corporate news, with Bayer raising its bid for Monsanto to $127.50 per share from $125. Molecular diagnostics firm Cepheid announced it's being bought out by Danaher for $53 per shares. Also, Spectra Energy is being bought out by Canadian pipeline firm Enbridge for $28 billion.
