U.S. Stocks May Move Back To The Upside In Early Trading

Following the pullback seen last Friday, stocks may move back to the upside in early trading on Monday. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 199 points.

The markets may continue to benefit from recent upward momentum, which helped propel the S&P 500 and the Nasdaq to new record highs last week.

Largely upbeat earnings and economic news has contributed to positive sentiment on Wall Street in recent sessions, although buying interest has been somewhat subdued.

Traders remain optimistic about the economic outlook, but analysts have raised some concerns about valuations and a potential correction.

Economic data is likely to attract attention in the coming days, with the Labor Department scheduled to release its closely watched monthly jobs report on Friday.

Economists currently expect employment to jump by 988,000 jobs in April after surging up by 916,000 jobs in May. The unemployment rate is also expected to dip to 5.8 percent from 6.0 percent.

Shortly after the start of trading, the Institute for Supply Management is scheduled to release its report on manufacturing activity in the month of April.

The ISM’s manufacturing PMI is expected to inch up to 65.0 in April from 64.7 in March, with a reading above 50 indicating growth in the manufacturing sector.

The Commerce Department is also due to release its report on construction spending in the month of March. Construction spending is expected to jump by 2.0 percent.

Later in the day, Federal Reserve Chair Jerome Powell is set to speak at the National Community Reinvestment Coalition’s 2021 Just Economy Conference via livestream.

Stocks moved mostly lower during trading on Friday, giving back ground following the advance seen on Thursday. The tech-heavy Nasdaq staged a recovery attempt in morning trading but quickly rejoined the Dow and S&P 500 in the red.

The major averages all closed firmly in negative territory. The Dow slid 185.51 points or 0.5 percent to 33,874.85, the Nasdaq dropped 119.87 points or 0.9 percent to 13,962.68 and the S&P 500 fell 30.30 points or 0.7 percent to 4,181.17.

For the week, the S&P 500 was nearly unchanged, while the Dow and the Nasdaq dipped by 0.5 percent and 0.4 percent, respectively.

The major all moved sharply higher for the month of April, however, with the Nasdaq and the S&P 500 spiking by 5.4 percent and 5.2 percent, respectively. The Dow also jumped by 2.7 percent.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Monday, although the Japanese and Chinese markets were closed for holidays. Hong Kong’s Hang Seng Index tumbled by 1.3 percent, while South Korea’s Kospi slid by 0.7 percent.

Meanwhile, European stocks have moved mostly higher on the day, with the U.K. markets closed for holiday. The German DAX Index is up by 0.7 percent and the French CAC 40 Index is up by 0.6 percent.

In commodities trading, crude oil futures are inching up $0.01 to $63.59 a barrel after tumbling $1.43 to $63.58 a barrel last Friday. Meanwhile, after edging down $0.60 to $1,767.70 an ounce in the previous session, gold futures are jumping $18.30 to $1,786 an ounce.

On the currency front, the U.S. dollar is trading at 109.34 yen versus the 109.31 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is trading at $1.2047 compared to last Friday’s $1.2020.