MW Oil prices sink as OPEC+ hikes output, U.S. stock futures dip ahead of Fed meeting

By Mike Murphy

Oil prices sank Sunday while U.S. stock futures declined after the S&P 500 notched its longest winning streak in more than 20 years last week.

Dow Jones Industrial Average futures (YM00) were down around 100 points, or 0.2%. S&P 500 futures (ES00) and Nasdaq-100 futures (NQ00) were also off about 0.2%.

Crude prices (CL.1) dropped about 4%, to $56.04, late Sunday after OPEC+ on Saturday agreed to ramp up output in June for a second straight month. The additional production of 411,000 barrels a day - after a similar hike in May - is seen as a punishment for overproduction by nations such as Iraq and Kazakhstan that had sent crude prices sharply lower, as well as appeasing President Donald Trump ahead of his upcoming trip to Saudi Arabia, Qatar and the UAE. June West Texas Intermediate crude (CLM25) fell 7.5% last week, the biggest weekly drop since the week ending April 4, according to Dow Jones Market Data. U.S. benchmark oil prices fell 18.6% in April - their biggest monthly loss since November 2021.

Investors will be looking toward Fed Chair Jerome Powell's remarks Wednesday, following a two-day meeting of the Fed's rate-setting committee. While the Fed is not expected to cut interest rates - much to the chagrin of Trump and many investors - ears will be perked for clues from Powell about if and when cuts may occur later this year. The CME FedWatch tool is still pricing in three rate cuts by the end of 2025.

Read more: Why Trump - and investors - will probably be disappointed by the Fed this week

Stocks rose sharply Friday, with the S&P 500 notching its ninth winning session in a row - its longest winning streak since 2004 - and erasing the losses it saw in the days following Trump's tariff announcement April 2.

For the week, the Dow Jones Industrial Average DJIA rallied 3%, the S&P 500 SPX rose 2.9% and the tech-heavy Nasdaq Composite Index COMP jumped 3.4%. All three benchmarks booked back-to-back-weekly gains.

Meanwhile, after a big week of quarterly results from Big Tech companies, Wall Street's earnings focus will shift this week to industry bellwethers such as the Walt Disney Co. $(DIS)$ and Warner Bros Discovery Inc. $(WBD)$, which should offer some insight on consumer entertainment spending; toy retailers Mattel Inc. $(MAT)$ and Hasbro Inc. $(HAS)$, which should shed light on the impact of tariffs on retail sales; and automaker Ford Motor Co. $(F)$, which will weigh in on the impact of the ever-changing tariffs on foreign-made vehicles and auto parts.

Read more: Wall Street's second-quarter outlook sours, with bigger-than-normal forecast cuts

-Mike Murphy

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May 04, 2025 18:21 ET (22:21 GMT)

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