U.S. stock index futures are suggesting a flat opening on Monday, indicating a potential lack of momentum after last week's strong performance. Investors appear hesitant to make significant moves ahead of the Labor Department's much-anticipated monthly jobs report due on Friday.
Economic analysts predict a rise in employment by 195,000 jobs for November, following a modest increase of 12,000 jobs in October. The unemployment rate is projected to edge up to 4.2 percent from 4.1 percent. Additional economic data, such as job openings, private sector employment, services sector activity, and consumer sentiment reports, are also expected to capture traders' interest this week.
Market participants will be closely monitoring comments from various Federal Reserve officials, including Chair Jerome Powell, for any insights regarding future interest rate decisions. According to the CME Group's FedWatch Tool, there's currently a 65.4 percent chance of an additional 25 basis-point rate cut later this month and a 34.6 percent chance of rates remaining steady.
In early trading, the Institute for Supply Management will release its November manufacturing activity report. Projections indicate the ISM manufacturing PMI will rise to 47.5 from 46.5, although a figure below 50 still signifies contraction.
Following a midweek market retreat, stocks rebounded on Friday post-Thanksgiving, with major indices erasing Wednesday's losses. This advanced the Dow and the S&P 500 to new all-time closing highs. Although the indices settled off their peak levels by the close, they remained solidly positive. The Dow climbed 188.59 points or 0.4 percent to 44,910.65, the Nasdaq gained 157.69 points or 0.8 percent to 19,218.17, and the S&P 500 rose 33.64 points or 0.6 percent to 6,032.38.
Throughout the shortened holiday week, the Nasdaq and S&P 500 each advanced by 1.1 percent, whereas the Dow increased by 1.4 percent. Strong buying interest emerged as investors sought value after Wednesday’s pullback, particularly in semiconductor stocks. The Philadelphia Semiconductor Index advanced by 1.5 percent, recovering from its lowest intraday point in over two months. Semiconductor equipment manufacturers saw gains following reports from Bloomberg that the Biden administration may limit sales of semiconductor equipment and AI memory chips to China, eschewing more stringent measures previously considered.
Other major sectors exhibited more restrained movements, as some traders stayed away from the market post-holiday, ahead of an early market close. The absence of significant U.S. economic reports potentially kept traders sidelined in anticipation of next week's critical data releases, including the Labor Department's jobs report and updates on manufacturing and services sector activity.
**Commodities and Currencies**
Crude oil futures surged by $0.92 to $68.92 per barrel, recovering from a $0.72 decline to $68 a barrel last Friday. Conversely, gold futures fell by $11.30 to $2,669.70 an ounce, following a $16.20 rise to $2,681 in the previous session.
In the currency market, the U.S. dollar is trading at 150.25 yen, up from 149.74 yen at the close of New York trading on Friday. Against the euro, the dollar has moved to $1.0506 from Friday's rate of $1.0577.
**Asia**
Asian stock markets saw broad gains on Monday, buoyed by strong Chinese factory activity data. However, concerns about a wider trade war limited regional advances after U.S. President-elect Donald Trump demanded a pledge from BRICS nations to support the dollar, cautioning against any moves to replace or undermine it.
"The idea that the BRICS Countries are trying to move away from the dollar while we stand by and watch is OVER," Trump stated on his Truth Social network on Saturday, threatening a 100 percent tariff on the nine-nation bloc if they undermine the U.S. dollar.
Despite robust PMI figures, China's yuan dropped to its lowest point since July 24. Gold prices declined nearly 1 percent as Trump's tariff threats strengthened the U.S. dollar. Meanwhile, oil prices rose in response to positive Chinese data and amid resumed Israeli military actions in Lebanon, heightening Middle East tensions.China's Shanghai Composite Index saw a notable increase of 1.1%, reaching 3,363.98, following an encouraging private survey that indicated a faster expansion in the country's manufacturing sector for November. The Purchasing Managers' Index (PMI) rose to 51.5 from 50.3 in October.
Over in Hong Kong, the Hang Seng Index rose by 0.7%, closing at 19,550.29.
Japanese markets experienced significant gains, primarily driven by robust performances in banking and technology stocks. The Nikkei 225 Index climbed 0.8% to settle at 38,513.02, with the broader Topix Index increasing by 1.3% to 2,714.72. Notable gainers included Advantest, Screen Holdings, Sumitomo Mitsui Financial, Mizuho Financial, and Mitsubishi UFJ Financial, with stock increases ranging from 2% to 4%.
Seoul's markets ended largely stable, with the Kospi concluding just slightly lower at 2,454.48 after a turbulent trading session. The technology sector faced declines, particularly Samsung Electronics, which dropped by 1.1%.
In Australia, stock markets finished slightly up, buoyed by gains in technology and consumer discretionary sectors. Myer Holdings jumped 12.3% following stronger-than-expected Australian retail sales data for October. The S&P/ASX 200 Index saw a marginal rise of 0.1% to 8,447.90, while the All Ordinaries Index maintained a minimal positive trend at 8,705.
Across the Tasman Sea, New Zealand's S&P/NZX-50 Index advanced by 0.4%, closing at 13,114.68.
**Europe**
European equities faced challenges finding clear direction on Monday, compounded by a dip in the euro against a strengthening U.S. dollar, as the Eurozone manufacturing PMI reached a two-month low of 45.2 in November. Investor sentiment was further affected by U.S. President-elect Donald Trump's warning of imposing a 100% tariff on BRICS nations if they explore alternatives to the U.S. dollar.
Germany's DAX Index rose by 1.3%, while the U.K.'s FTSE 100 Index and France’s CAC 40 Index saw gains of 0.5% and 0.3%, respectively.
Reports have suggested that France's far-right National Rally party might back a no-confidence motion against the government unless amendments to the controversial budget proposal align with party demands.
In corporate news, shares of Stellantis NV fell sharply after CEO Carlos Tavares announced his immediate resignation. Homebuilder Persimmon's stocks declined, along with Taylor Wimpey, following news that the government plans to implement a Building Safety Levy to finance safety improvements, assessed as a percentage of new development sales.
Delivery Hero SE's shares decreased. The company, under Spanish regulatory scrutiny, announced it would transition Glovo from a freelance model to an employment-based model to mitigate legal challenges.
Conversely, Supreme, a consumer goods supplier, experienced a surge in London after acquiring Typhoo Tea in a cash deal valued at £10.2 million.
**U.S. Economic News**
The Institute for Supply Management (ISM) is set to publish its November report on manufacturing activity at 10 am Eastern Time, with expectations of a slight increase in the manufacturing PMI to 47.5 from October's 46.5, although figures below 50 still signify contraction.
Simultaneously, the Commerce Department plans to release its October construction spending report, forecasting a 0.2% rise following a 0.1% climb in September.
Federal Reserve Board Governor Christopher Waller is scheduled to discuss the economic outlook at the American Institute for Economic Research Monetary Conference, "Building a Better Fed Framework," at 3:15 pm ET.
Additionally, New York Federal Reserve President John Williams will engage in a discussion hosted by the Queens Chamber of Commerce at 4:30 pm ET.
