(Reuters) -The S&P and the Dow indexes were set to retreat from record highs on Monday as concerns over rising COVID-19 cases weighed on sentiment, with oil stocks reeling from a more than 4% slump in crude prices.
Energy firms Exxon Mobil Corp, Chevron Corp, Halliburton Co and Schlumberger NV dropped between 1.3% and 2.2% in premarket trade, as an increase in coronavirus cases, particularly in China, raised fears of new curbs that could hurt demand. [O/R]
Metal miners also came under pressure from steep declines in copper and gold prices on concerns over Chinese demand. Freeport-Mcmoran Inc, the world’s largest publicly traded copper producer, fell around 1.7%. [GOL/] [MET/L]
In the United States COVID-19 infections rose by at least 22,783 on Sunday to 35.94 million total cases, according to a Reuters tally.
“The overriding trepidation is still coming from Delta (variant) and the market is just being little bit cautious here despite the strong jobs report,” said Thomas Hayes, managing member at Great Hill Capital in New York.
Investors awaited fresh catalysts to push the market higher, after strong jobs data saw the S&P 500 and the Dow Jones end last week at record highs.
A meeting of Federal Reserve leaders in Jackson Hole, Wyoming, later this month, is also expected to shed more light on the central bank’s potential plan to trim its stimulus program, in the wake of rising inflation and strength in the job market.
“The market is probably looking toward Jackson Hole to whether or not the Fed is going to change their tune, and possibly talk about taper earlier rather than later,” said Hayes.
Focus was also on the passing of a $1 trillion bipartisan U.S. infrastructure bill with a vote possible by Tuesday, after details of the bill gained support in the Senate over the weekend.
At 8:08 a.m. ET, Dow e-minis were down 105 points, or 0.3%, S&P 500 e-minis were down 7.25 points, or 0.16%, and Nasdaq 100 e-minis were up 12.5 points, or 0.08%.
A stellar earnings season has seen U.S. stocks surge to record highs over the past two weeks, as several consensus-beating results from major firms reinforced faith in a post-COVID economic recovery this year.
Analysts expect second-quarter profit growth of 92.9% for S&P 500 companies, according to IBES data from Refinitiv. Of the 427 companies in the index that have reported earnings so far, 87.6% beat analyst expectations, the highest on record.
Sanderson Farms Inc gained 8% after it agreed to be bought for $4.53 billion by commodities trader Cargill Inc and investment firm Continental Grain Co at a time when meat prices have been soaring due to strong demand.
American National Group Inc jumped 8.2% after Brookfield Asset Management Inc’s reinsurance unit agreed to buy the U.S. insurer for about $5.1 billion.
Cryptocurrency stocks including crypto exchange Coinbase Global Inc and miners Riot Blockchain Inc, Marathon Digital Holdings Inc added between 4.2% and 7.4%, as bitcoin hit a three-month high.
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