US pre-open: Stocks seen slightly higher as payrolls continue to underpin sentiment
US futures pointed to a slightly firmer open on Wall Street as investors continued to take heart from Friday’s better-than-expected non-farm payrolls report.
At 1040 BST, Dow Jones Industrial Average and S&P 500 futures were up 0.2%, while Nasdaq futures were 0.3% higher,.
At the same time, oil prices were firmer. West Texas Intermediate was up 1.3% at $42.35 a barrel and Brent crude was 1.1% stronger at $44.76.
Investors shrugged off some uninspiring data from China, which showed exports in the world’s second-largest economy fell 4.4% in July, while imports declined 12.5%, both of which were weaker than expected.
Instead, they continued to cheer Friday’s strong non-farm payrolls report, which showed the US economy added 255,000 jobs last months versus expectations of a 180,000 gain, boosting expectations of a rate hike by the Federal Reserve this year.
Ipek Ozkardeskaya, senior market analyst at London Capital Group, said: “The S&P500 and Dow Jones picked up a positive momentum; equity investors appeared comfortable with the idea of a tightening in the US’s monetary conditions. Whether or not the Fed could hike rates this year is still dependent on the data.
“If the US economy continues showing a solid macroeconomic performance, the financial markets would grant their approval for an additional 25 basis points hike in Federal funds rate by the end of the year.”
On the corporate front, Mattress Firm rocketed in pre-market trade on news that South Africa’s Steinhoff International had agreed to buy the company for $3.8bn.
Meanwhile, Wal-Mart was likely to be in focus amid reports it will announce a $3bn deal to buy online retailer Jet.com later on Monday.
Tyson Foods, Allergan and News Corp were all slated to report earnings.
There are no major US data releases due on Monday.