Stocks look for direction ahead of Fed; oil prices jump

By Tanya Agrawal

REUTERS - The S&P 500 and the Dow were set to open little changed, while the Nasdaq was on track to open lower on Monday, after the three major indexes registered fresh record highs on Friday.

Oil prices rose as much as 6.5 percent to an 18-month high after OPEC and some of its rivals reached their first deal since 2001 to jointly reduce output to try to tackle global oversupply and boost prices.

President-elect Donald Trump's expected agenda of economic stimulus and reduced taxes and regulations has fueled a market rally, with the benchmark S&P 500 rising 5.6 percent since Nov. 8 to Friday's close.

The Dow has closed at record highs 14 times since the election.

"This market has gone up without taking a breather and will enter a cautious trading day as it awaits the Fed," said Peter Cardillo, chief market economist at First Standard Financial in New York.

Investors are keeping a close watch on the U.S. Federal Reserve's last meeting for the year, beginning Tuesday, with a statement from Fed Chair Janet Yellen on Wednesday. The central bank is widely expected to raise benchmark interest rates, with market participants looking for clues about the pace of future hikes.

"The most recent 'dot plot' from the September meeting shows another two rate hikes are projected for 2017, which is in line with market expectations, and investors are wondering if these dots are going to move higher when released on Wednesday," said Hussein Sayed, chief market strategist at forex broker FXTM.

Dow e-minis were up 23 points, or 0.12 percent, with 15,871 contracts changing hands at 8:19 a.m. ET (1319 GMT).

S&P 500 e-minis remained unchanged, with 181,297 contracts traded.

Nasdaq 100 e-minis were down 17.5 points, or 0.36 percent, on volume of 17,368 contracts.

The dollar rose to its highest since February against the yen on Monday as U.S. bond yields climbed on the back of expectations of broadly higher inflation, driven by a rise in global oil prices.

Ophthotech slumped 81.5 percent to $7.19 in premarket trading after Novartis said a combination of its eye drug along with the company's did not produce better outcomes.

Goodyear Tire & Rubber was up 2.3 percent at $32.92 after Barron's said the tire maker's shares could rise 25 percent in a year.

(Reporting by Tanya Agrawal; Editing by Sriraj Kalluvila)