US open: Wall Street opens higher ahead of Facebook earnings, oil jumps

US stocks look set to open higher ahead of a busy week for earnings with Facebook due to release earnings after the close. Inflation concerns will remain in focus as oil prices jump.

USA (2)

US futures

Dow futures +0.13% at 35715

S&P futures +0.2% at 4555

Nasdaq futures +0.4% at 15416

In Europe

FTSE +0.15% at 7226

Dax +0.3% at 15600

Euro Stoxx +0.15% at 4196

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Stocks look to earnings

US stocks are set for a mildly higher open on Monday as investors readied themselves for a slew of big earnings releases this week. Big tech heavy weights are set to report this week kicking off with Facebook after the close today.

Even before big tech earnings get under the tech sector is in focus with PayPal up over 5%. Investors breathed a sigh of relief on the news that the payments company has ruled out pursuing Pinterest at this time. Meanwhile the latter slumped 15% on the prospect of the deal not going ahead.

Inflation concerns will continue to linger particularly with oil prices on the rise at multi year highs and following Jerome Powell’s comments on Friday. So far share prices have remained resilient in the face of rising price pressures with the S&P and the Dow hitting record highs. However, signs of rising cost pressures hurting guidance could put the brakes on further moves higher.

Where next for the S&P?

The S&P is bracing for fresh record highs above 4550. The 50 sma crossed above the 100 sma on the 4 hour chart. However, the RSI is in overbought territory so there could be some consolidation at these levels or an easing back before fresh record highs. A move below 4500 could negate the near-term uptrend.

S&P 500 chart

FX – USD rebounds, EUR falls as German business sentiment deteriorates

The US Dollar is rebounding at the start of the week after dropping to a monthly low on Friday. Fed Chair Jerome Powell had all but confirmed the tapering of bond purchases but pushed back on the prospect of a rate hike. The pickup in the US Dollar is receiving a helping had from the weaker Euro.

EUR/USD is heading lower, paring gains from the previous week. German business sentiment in October as supply chain bottlenecks clouded the near-term outlook. The IFO index fell to 97.7 from 98.9 in September, marking the 4th straight month of declines.

GBP/USD +0.09% at 1.3770

EUR/USD -0.21% at 1.1620

Oil eases, uptrend remains intact

Oil prices are rising higher, adding to gains from the previous week and hitting multi year highs. Tight supply keeps oil prices buoyant as demand continues to rise as economies reopen. According to Goldman Sachs oil demand is back up at 99 million bpd where it was pre-pandemic. The investment bank still sees oil trading above $90 sooner rather than later. Analyst as Goldman’s consider that the switch from oil to gas amid ongoing energy crisis is boosting demand by around $1 million barrels per day.

WTI crude trades +0.9% at $84.37

Brent trades +0.7% at $85.41

Learn more about trading oil here.

 

Looking ahead

14:45 Dallas Fed Manufacturing Business  Index


 

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