The major U.S. index futures are currently pointing to a higher open on Monday, with stocks likely to see further upside following the advance last Friday.

The markets seem likely to continue to recover from the sell-off seen in the middle of last week, which came amid indications the Federal Reserve plans to begin tapering its asset purchases this year.

Strength in overseas markets may generate positive sentiment on Wall Street, with Asian stocks showing a notable recovery from recent weakness.

Trading activity may be somewhat subdued, however, as traders look ahead to the Fed’s annual Jackson Hole symposium later this week.

Comments from Fed officials at the symposium may shed additional light on the outlook for monetary policy ahead of the next meeting in September.

Reports on new home sales, durable goods orders and personal income and spending are also likely to attract attention in the coming days.

Following the lackluster performance seen during trading on Thursday, stocks showed a notable move to the upside during trading on Friday. The major averages all ended the day firmly in positive territory after ending the previous session on opposite sides of the unchanged line.

The tech-heavy Nasdaq outperformed its counterparts, jumping 172.88 points or 1.2 percent to 14,714.66. The Dow also climbed 225.96 points or 0.7 percent to 35,120.08 and the S&P 500 advanced 35.87 points or 0.8 percent to 4,441.67.

Despite the advance on the day, the major averages all moved lower for the week. The Dow slumped by 1.1 percent, while the Nasdaq and the S&P 500 slid by 0.7 percent and 0.6 percent, respectively.

With the upward move on the day, stocks did regain ground following the sharp pullback seen during trading on Tuesday and Wednesday.

The major averages fell to their lowest levels in almost a month amid concerns about the outlook for monetary policy following the release of the minutes of the latest Federal Reserve meeting.

The Fed minutes indicated most officials were in favor of beginning to scale back the central bank’s asset purchase program later this year.

However, there was some disagreement about the timing of tapering asset purchases, and analysts have pointed out that some disappointing economic data has been released since the July meeting.

Uncertainty about the outlook for monetary policy may lead traders to keep a close eye on upcoming economic data ahead of the Fed’s next meeting in September.

Technology stocks helped to lead the way higher during trading on Friday, as reflected by the notable advance by the tech-heavy Nasdaq.

Significant strength was visible among biotechnology stocks, as reflected by the 1.9 percent jump by the NYSE Arca Biotechnology Index.

Software stocks also showed a substantial move to the upside, driving the Dow Jones U.S. Software Index up by 1.9 percent to a record closing high.

Computer hardware, housing and brokerage stocks also saw notable strength on the day, moving higher along with most of the other major sectors.

Commodity, Currency Markets

Crude oil futures are spiking $2.04 to $64.18 barrel after tumbling $1.36 to $62.14 a barrel last Friday. Meanwhile, after inching up $0.90 to $1,784 an ounce in the previous session, gold futures are climbing $13.60 to $1,797.60 an ounce.

On the currency front, the U.S. dollar is trading at 110.02 yen versus the 109.78 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is trading at $1.1729 compared to last Friday’s $1.1698.

Asia

Asian stocks regained ground on Monday amidst a recovery in crude oil prices and positive U.S. stock futures. All major benchmarks closed in the green despite investors anxiously awaiting the Federal Reserve’s annual Jackson Hole conference later in the week for cues on the asset purchase tapering timeline.

China’s Shanghai Composite Index rallied by 1.5 percent or 49.80 points to end trade at 3,477.13 amidst relief over reports that there were no new locally transmitted Covid-19 cases for the first time since July. Sentiment also improved upon government official’s comment on the country’s cross-cyclical macroeconomic policy and its stabilizing effect on economic fluctuations.

Japan’s Nikkei 225 Index jumped 480.99 points or 1.8 percent to close at 27,494.24, recovering smartly from Friday’s multi-month low. Auto components supplier Denso Corp., marine transporting company Kawasaki Kisen Kaisha and international shipping company Mitsui O.S.K Lines were among the top gainers, surging more than 5 percent. Kobe Steel declined by 1.7 percent, followed by Sumitomo Osaka Cement Co, which fell by 1.6 percent.

The Korean Stock Exchange’s Kospi Index gained 29.70 points or 1 percent to close at 3,090.21. Trading was within the range of 3,064.65 to 3,111.81. Shares of battery maker LG Chem Ltd. tumbled 11.1 percent following General Motors’s recall of 73,000 Chevrolet Bolt cars that use the South Korean firm’s batteries.

The Hang Seng Index of the Hong Kong Stock Exchange recovered from a nine-month low in the previous week to gain 265.28 points or 1.1 percent to close at 25,115.00. The day’s high was at 25,479.00 and low was at 25,051.12.

Australia’s S&P ASX 200 Index rose 29 points or 0.4 percent to close at 7,489.90, around 1.9 percent below its 52-week high of 7,632.80. Traders mostly shrugged off multi-month lows in manufacturing and services PMI data as well as coronavirus induced lockdown situations.

Pilbara Minerals bounced back 11.4 percent after a two-week sell-off. Artificial Intelligence company Appen Ltd. gained 7.1 percent in the run-up to results declaration on Thursday. Aerial survey company Nearmap, coal producer Whitehaven Coal and property investment management company Charter Hall group all gained more than 6 percent.

Health insurer NIB Holdings lost 11 percent despite upbeat results upon concerns over deferment in healthcare treatments. TPG Telecom declined by 5.8 percent and G8 Education lost 5.7 percent. Ampol, which bid for New Zealand’s Z Energy, shed 4.8 percent, while Super Retailer Group declined by 4.62 percent.

Europe

European stocks have advanced on Monday after a survey showed activity in Germany’s manufacturing and services sectors expanded in August.

Growth in French business activity eased in the month, while the Eurozone manufacturing PMI came in at 61.5 versus 62.0 expected and 62.8 last month.

The bloc’s services PMI dropped to a two-month low of 59.7 in August versus 59.8 expected, data showed.

While the French CAC 40 Index has advanced by 0.9 percent, the U.K.’s FTSE 100 Index is up by 0.4 percent and the German DAX Index is up by 0.2 percent.

Higher commodity prices have helped lift miners, with Anglo American, Antofagasta and Glencore posting notable gains.

BioNTech has jumped on buzz the U.S. FDA was aiming to give full approval to its partner Pfizer’s COVID-19 vaccine by Tuesday.

Sainsbury has soared after a report an American private equity firm is exploring a takeover of the supermarket chain.

ING has also risen. The Dutch bank said it has appointed Marnix van Stiphout as chief operations officer and chief transformation officer and member of the Management Board Banking.

easyJet shares have also advanced. The airline said it has appointed Stephen Hester as a director and Chair designate.

On the other hand, Vonovia shares have declined after the German residential real estate company launched its voluntary public takeover offer for shares of Deutsche Wohnen.

Swiss chemicals firm Clariant has dipped after it acquired the remaining 70 percent stake in Brazilian Personal Care specialty company Beraca to seize full control.

Cembra Money Bank has plummeted after terminating its credit card partnership with Swiss retailer Migro.

British advertising company WPP is gaining ground after it acquired Satalia, an artificial-intelligence technology company, for an undisclosed sum.

U.S. Economic Reports

The National Association of Realtors is scheduled to release its report on existing home sales in the month of July at 10 am ET. Existing home sales are expected to jump by 1.3 percent.




Futures Pointing To Initial Strength On Wall Street

2021-08-23 12:49:38

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