U.S. Futures Edge Lower; Peloton Surges on Bid Interest

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U.S. Futures Edge Lower; Peloton Surges on Bid Interest
Credit: © Reuters.

By Peter Nurse   

Investing.com - U.S. stocks are seen opening marginally lower Monday, handing back some of last week’s gains ahead of key inflation data, while earnings season rumbles on.

At 7 AM ET (1200 GMT), the Dow Futures contract was down 40 points, or 0.1%, S&P 500 Futures traded 5 points, or 0.1%, lower and Nasdaq 100 Futures traded largely unchanged.

The main equity indices posted healthy gains last week, boosted by generally positive corporate earnings as well as a stronger-than-expected monthly official jobs report .

The blue-chip Dow Jones Industrial Average posted a gain of just over 1% last week, while the broad-based S&P 500 climbed 1.5% and the Nasdaq Composite rose 2.4%, both indices recording their best weeks since December.

The Russell 2000 also posted its first positive week in five, but strategists at Goldman Sachs (NYSE: GS ) cautioned that tightening financial conditions, slowing economic growth and a flattening Treasury yield curve are all likely to “pressure” returns from the small-cap index relative to the S&P 500.

Friday’s jobs report saw the U.S. add 467,000 nonfarm jobs in January, much more than expected, suggesting that the largest economy in the world has weathered the winter wave of Covid-19 cases more easily than first imagined. The Federal Reserve will have taken note of this, but the main focus remains on inflation and Thursday’s consumer prices report for January.

Economists expect the CPI to rise by 0.5% on the month and 7.3% year over year, with core CPI (excluding food and energy prices) also rising 0.5% and 5.9%, respectively.

The quarterly earnings season will continue this week, although Monday is relatively quiet with only the likes of Tyson Foods (NYSE: TSN ), Loews (NYSE: L ), Hasbro (NASDAQ: HAS ) and Simon Property Group (NYSE: SPG ) due to release numbers.

Elsewhere, Peloton (NASDAQ: PTON ) will be in the spotlight following reports that the troubled exercise equipment company is in play. Amazon (NASDAQ: AMZN ) is exploring an offer, according to a report from Reuters, while the Financial Times added Nike (NYSE: NKE ) to the list of those interested in the maker of fitness equipment.

Oil prices weakened Monday, retreating from the highest levels since 2014 after the winter storm which hit large parts of the U.S. late last week didn’t result in any major disruption to Texas’ energy complex.

Oil has soared this year as the global economy has recovered from the Covid pandemic but supply has struggled to keep up with this improving demand. Increased geopolitical tensions surrounding Russia’s intentions for Ukraine have also added a risk premium to the price.

By 7 AM ET, U.S. crude futures traded 0.9% lower at $91.50 a barrel, while the Brent contract fell 0.3% to $93.04.   

Additionally, gold futures rose 0.4% to $1,814.15/oz, while EUR/USD traded 0.1% lower at 1.1444.

 

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