Investing.com –Wall Street futures pointed to a slightly higher open on Tuesday in what was expected to be cautious trade as investors take positions ahead of key monetary policy decisions and waited for data on the housing market later in the session.
The blue-chip Dow futures rose 53 points, or 0.29%, by 6:59AM ET (10:59AM GMT), the S&P 500 futures gained 8 points, or 0.35%, while the tech-heavy Nasdaq 100 futures traded up 16 points, or 0.33%.
Both the Federal Reserve (Fed) and Bank of Japan (BoJ) kicked off their respective two-day policy meetings on Tuesday with Tokyo’s central bank garnering more attention based on the speculation over possible moves.
While the BoJ is widely expected to embark on more policy easing when announces its own rate decision and monetary policy statement ahead of the Fed’s own decision, economists were split on exactly what the next move would be.
Among the options being considered were a possible interest rate cut deeper into negative territory, tweaks to its asset-purchase program or new rules on the duration of securities it will purchase in the bond market.
Meanwhile, the Fed is not expected to make a move on interest rates at the conclusion of its two-day policy meeting at 2:00PM ET (18:00GMT) on Wednesday, but investors will first focus on the statement and updated forecasts for economic growth and interest rates that will be released simultaneously with the rate decision for a first gauge on when the central bank contemplates returning to policy normalization.
Fed chair Janet Yellen will then hold what will be a closely-watched press conference 30 minutes after the release as investors look for any change in tone about the economy or future rate hikes.
Markets are currently pricing in just a 15% chance of a rate hike this week, according to Investing.com's Fed Rate Monitor Tool. For December, odds stood at 59.2%.
At the same time, both the dollar and gold were trading flat on Tuesday in a holding pattern ahead of the decision.
Ahead of the week’s big event stateside, market participants will digest the state of the U.S. real estate market with August building permits and housing starts at 8:30AM ET (12:30GMT).
The data will be examined by the Atlanta Fed in order to update to its third quarter GDP forecast, currently at 3.0%, later in the session.
In company news, Lennar (NYSE:LEN) beat on both the top and bottom line as the second-largest U.S. homebuilder on the back of the recovering housing market with orders jumping 8.1%.
FedEx (NYSE:FDX), KB Home (NYSE:KBH) and Adobe Systems Incorporated (NASDAQ:ADBE) were among other companies slated to report earnings on Wednesday.
Among active pre-market trade, Chesapeake Energy (NYSE:CHK) was down more than 5% after S&P downgraded the firm’s rating to “selective default”.
Meanwhile, oil prices retreated on Tuesday, falling towards six-week lows, after Venezuela said that global supplies needed to fall by 10% in order to bring production down to consumption levels.
Global oil supply of 94 million barrels per day needs to fall by about a tenth if it is to match consumption, Venezuela's Oil Minister Eulogio Del Pino said on Monday.
U.S. crude futures fell 0.68% to $43.56 by 7:01AM ET (11:01AM GMT), while Brent oil lost 0.70% to $45.63.