By Peter Nurse
Investing.com – U.S. stocks are seen opening lower Monday, handing back some of the gains of the previous session ahead of the release of the latest minutes from the April Federal Reserve meeting.
At 7:05 AM ET (1205 GMT), the Dow Futures contract was down 125 points, or 0.4%, S&P 500 Futures traded 14 points, or 0.4%, lower, and Nasdaq 100 Futures dropped 60 points, or 0.4%.
The broad-based S&P 500 rose 1.5% on Friday, its biggest one-day jump in more than a month, the Dow Jones Industrial Average added 1% and the Nasdaq Composite gained 2.3%. However, all three indices still ended the week lower, posting their worst week since Feb. 26, on the back of hefty losses early in the week when fears of runaway inflation – with the CPI at its highest since 2008, -prompted investors to sell.
The CPI release intensified fears that the Federal Reserve could be forced to start tapering its ultra-easy monetary policies sooner than the central bank is currently guiding.
With this in mind, the Fed’s minutes from its last meeting, released Wednesday, and will be studied carefully to see if it offers any new clues on policymakers’ thinking.
In corporate news, the first-quarter earnings season is coming to the close, with more than 90% of the S&P 500 companies having reported their results.
The media sector is likely to be in focus following reports that telecoms giant AT&T (NYSE:T) is nearing a deal to combine its media assets, including CNN and HBO, with Discovery (NASDAQ:DISCA), the owner of a number of cooking, nature and science shows.
The deal would confirm the importance of streaming in terms of TV viewing, where scale is required to take on the likes of Netflix (NASDAQ:NFLX) and Walt Disney (NYSE:DIS).
JD.com (NASDAQ:JD) is also likely to be in the spotlight after the Chinese online retail giant’s logistics arm said it would aim to raise some $3.4 billion through an IPO in Hong Kong of a 10% stake.
Oil prices edged lower Monday as new Covid-19 restrictions in parts of Asia raised concerns of reduced demand in the region.
Worries are growing that the highly transmissible coronavirus variant which has hit India so hard is spreading to other countries. Singapore and Taiwan, are seeing new outbreaks, while Japan has further expanded a state of emergency casting fresh doubt over its ability to host the Tokyo Olympics in July.
That said, losses are small as China and the U.S., the two biggest oil consumers in the world, and most of Western Europe are reopening in the wake of successful Covid-19 vaccination programs.
U.S. crude futures traded 0.1% lower at $65.27 a barrel, while the Brent contract fell 0.2% to $68.60. The two contracts jumped nearly 2.5% on Friday and managed to book a small gain last week, marking a third consecutive weekly increase.
Additionally, gold futures rose 0.7% to $1,850.15/oz, while EUR/USD traded 0.2% higher at 1.2166.