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At 06:55 ET (10:55 GMT), the Dow Futures contract was up 105 points, or 0.3%, S&P 500 Futures traded 12 points, or 0.3%, higher and Nasdaq 100 Futures climbed 19 points, or 0.1%.
The main indices closed lower Tuesday, with the blue chip Dow Jones Industrial Average hit the hardest, dropping over 330 points, or 1%, as a meeting between President Joe Biden and House Speaker Kevin McCarthy ended without an agreement to lift the country’s $31.4 trillion borrowing limit.
The U.S. is widely expected to run out of money to pay debt holders early next month, and such an event could prove to be catastrophic for the U.S. and have serious knock-on effects for the global economy.
That said, McCarthy said late Tuesday “it is possible to get a deal by the end of the week”, and Biden will cut short his trip to Asia for the G-7 meeting to participate in further negotiations in person, suggesting a deal could be close.
In the corporate sector, Target (NYSE:TGT) will be in focus after the retail giant forecast a gloomy second quarter as consumers pinched by persistently higher prices shun buying non-essentials such as electronics and home goods.
DIY group Home Depot (NYSE:HD) slashed its guidance on Tuesday after unfavorable weather contributed to weaker-than-expected sales, while economic data showed that retail sales rose just 0.4% on the month in April, below the expected 0.8% growth.
Investors will have a chance on Wednesday to examine the health of the U.S. real estate market with the release of the housing starts and building permits figures for April.
The Federal Reserve is still widely expected to pause its interest-rate hiking cycle in June as it assesses the impact of its policy actions, but comments from a number of officials this week suggest this is not a foregone decision.
Oil prices edged higher Wednesday, with traders making light of a surprise rise in U.S. crude stockpiles.
U.S. crude inventories rose by around 3.6 million barrels in the week ended May 12, according to data from the industry body American Petroleum Institute, instead of the expected drawdown.
However, the impact has been limited as releases from the Strategic Petroleum Reserve have to be factored into the inventory build, while the drop in gasoline and distillates inventories pointed to improving demand ahead of the summer season.
Additionally, the International Energy Agency on Tuesday, in its monthly report, predicted a very tight market in the second half of the year, with demand outpacing supply by 2 million barrels per day.
Official U.S. government data on crude and product stockpiles from the Energy Information Administration are due later in the session.
By 06:55 ET, U.S. crude futures traded 0.5% higher at $71.23 a barrel, while the Brent contract climbed 0.5% to $75.28.
Additionally, gold futures fell 0.1% to $1,991.95/oz, while EUR/USD traded 0.3% lower at 1.0829.
