Stocks – U.S. Futures Slip; Consolidating After Recent Gains

(C) Reuters.

By Peter Nurse

Investing.com – U.S. stocks are set to edge lower Monday, consolidating after recent gains as investors consider the risk of a resurgence in the coronavirus as lockdowns are lifted.

At 07:05 AM ET (1105 GMT), S&P 500 Futures traded 18 points, or 1.6%, lower, Nasdaq 100 Futures down 22 points, or 0.3%. The Dow futures contract fell 144 points, or 0.6%.

Wall Street posted its first winning week in three last week, overlooking Friday’s 20.5 million job losses which sent the unemployment rate soaring to 14.7 per cent, by far the worst number seen since the Great Depression.

Leading the gains have been the country’s tech giants. The Nasdaq 100 index is now just over 5% off its all time high, despite the grim economic news.

Boosting the general optimism of late has been the idea that the American economy is reopening – California, Michigan, and Ohio, three of the important states for U.S. manufacturing, have taken steps to allow factories and some businesses to resume work.

However, the news out of South Korea, earlier Friday, of a new spike in cases has prompted concerns as the East Asian nation has been praised globally for its efforts in curbing the virus.

The United States has seen 1.3 million infections and nearly 80,000 deaths in the pandemic, the most in the world by far, according to a tally by Johns Hopkins University, although aggregate numbers for Europe are still higher.

In the corporate sector, AMC Entertainment (NYSE:AMC) stock was up over 9% premarket following a report that linked Amazon (NASDAQ:AMZN) to the world’s largest cinema chain, which has faced difficulties given the economic shutdown.

Tesla (NASDAQ:TSLA) stock fell 3.4% premarket after the electric carmaker’s boss Elon Musk said it had filed a lawsuit against Alameda County in California, after the county’s health department had refused to let the Tesla factory reopen Friday. Musk added he may move the electric carmaker’s headquarters out of California.

Walt Disney (NYSE:DIS) will also be in focus after its Shanghai Disneyland park reopened at 30% of capacity Monday, a first small step to restoring one of the group’s biggest profit machines.

Oil futures slipped back Monday, consolidating after recent gains had pushed the sector from the all-time lows seen recently. Last week the oil market also posted its first winning week in three.

At 7:05 AM ET, U.S. crude June futures traded 1.7% lower at $24.32 a barrel, while the international benchmark Brent contract fell 2.5% to $30.20.

Elsewhere, gold futures fell 0.7% to $1,701.25/oz, while EUR/USD traded at 1.0817, down 0.2%.