* Oil prices rise as Bahrain violence intensifies
* Japan stocks rally but nuclear crisis remains
* Futures trading volatile
* Futures: S&P off 2.4 pts, Dow off 9 pts, Nasdaq up 1.5
* For up-to-the-minute market news see []
(Updates market activity)
By Edward Krudy
NEW YORK, March 16 (Reuters) - U.S. stock index futures
fell in volatile trade on Wednesday as Japan struggled with a
nuclear crisis and as clashes in Bahrain lifted oil prices,
with uncertainty set to drive near-term trading.
Japan's stock market rebounded from sharp losses but
another fire broke out at an earthquake-crippled nuclear
facility, which has sent low levels of radiation toward Tokyo
in the past 24 hours, triggering fears of a meltdown. For
details, see [] and []
Brent crude rose 2 percent to nearly $111 a barrel,
rebounding from a three-week low as Bahraini forces, backed by
helicopters, fired tear gas on protesters and hospital sources
said several police and protesters had been killed.
[]
"There is a perfect storm of uncertainty right now in terms
of global growth and markets are taking that into account,"
said Oliver Pursche, president at Gary Goldberg Financial
Services in Suffern, New York.
S&P 500 futures <SPc2> lost 2.4 points and were below fair
value, a formula that evaluates pricing by taking into account
interest rates, dividends and time to expiration on the
contract. Dow Jones industrial average futures <DJc2> dipped 9
points, and Nasdaq 100 futures <NDc2> rose 1.5 points.
Japan's Nikkei average closed up 5.7 percent on Wednesday
as hedge funds rushed to cover short positions after the worst
two-day rout since the 1987 crash.
In a second day of losses tied to Japan, the S&P 500 fell
to within 4 points of its 2010 close on Tuesday. The index
dropped more than 2 percent in early trade before rebounding,
and the Nasdaq briefly turned negative for the year.
Some investors have been using the sell-off to buy stock in
the belief the longer-term outlook for the U.S. economy
remained strong, a factor that could limit losses.
"We are looking at the sell-off in particular in energy and
agriculture as an opportunity to add to our positions," said
Pursche. "We think that this a pretty good entry point."
Muammar Gaddafi's forces pushed toward the Libyan rebel
stronghold of Benghazi and the government predicted victory
within days, while world powers debated imposing a no-fly zone
to help stop him. []
On the economic front, the Producer Price Index for
February will be released at 8:30 a.m. EDT (1230 GMT).
Economists forecast a 0.7 percent rise, compared with a 0.8
percent increase in January.
Also at 8.30 a.m., the Commerce Department releases housing
starts and permits for February. Economists forecast starts
fell to a 570,000 annualized rate from 596,000 in January, and
a total of 570,000 permits were expected in February compared
with 563,000 in the prior month.
(Editing by Jeffrey Benkoe)
