WASHINGTON (dpa-AFX) - Following the sharp pullback seen last week, stocks may see further downside in early trading on Monday. The major index futures are currently pointing to a significantly lower open for the markets, with the Dow futures down by 598 points.
Concerns about a second wave of coronavirus infections may continue to weigh on the markets after Beijing recorded a spate of new Covid-19 cases in a major wholesale food market.
Data compiled by the New York Times also showed a recent increase in coronavirus cases in more than 20 states, including California, Florida, and Nevada.
Texas and North Carolina also reported a record number of coronavirus-related hospitalizations on Saturday, adding to worries that businesses reopening may drive a second wave.
New York Governor Andrew Cuomo said Sunday the state has received 25,000 complaints about businesses violating reopening guidelines and threatened to take liquor licenses away from bars and restaurants that break the rules.
However, the negative sentiment may be partly offset by a report from the New York Federal Reserve showing manufacturing activity in New York steadied in June after seeing sharp contractions in April and May.
The New York Fed said its general business conditions index spiked to negative 0.2 in June from negative 48.5 in April. A negative reading indicates a contraction in regional manufacturing activity.
The jump by the index far exceeded the estimates of economists, who had expected the index to surge up to negative 27.5.
Traders may also be reluctant to make significant moves ahead of two days of congressional testimony from Federal Reserve Chair Jerome Powell.
After moving sharply higher early in the session, stocks fluctuated over the course of the trading day on Friday but maintained a largely positive bias. The advance on the day came on the heels of the sell-off seen on Thursday.
The major averages showed some wild swings before finishing the day firmly positive territory. The Dow spiked 477.37 points or 1.9 percent to 25,605.54, the Nasdaq jumped 96.08 points or 1 percent to 9,588.81 and the S&P 500 surged up 39.21 points or 1.3 percent to 3,041.31.
Despite the rebound on the day, the major averages posted steep losses for the week. The Dow and the S&P 500 plunged by 5.6 percent and 4.8 percent, respectively, while the Nasdaq slumped by 2.3 percent.
In overseas trading, stock markets across the Asia-Pacific region moved sharply lower during trading on Monday. Japan's Nikkei 225 Index plummeted by 3.5 percent, while Hong Kong's Hang Seng Index tumbled by 2.2 percent.
The major European markets have also moved to the downside on the day. While the U.K.'s FTSE 100 Index has slumped by 1 percent, the German DAX Index and the French CAC 40 Index are down by 0.8 percent and 0.7 percent, respectively.
In commodities trading, crude oil futures are tumbling $1.36 to $34.90 a barrel after edging down $0.08 to $36.26 a barrel last Friday. Meanwhile, after falling $2.50 to $1,737.30 an ounce in the previous session, gold futures are plunging $26.90 to $1,710.40 an ounce.
On the currency front, the U.S. dollar is trading at 107.40 yen versus the 107.38 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is valued at $1.1249 compared to Friday's $1.1256.
Copyright RTT News/dpa-AFX