U.S. Stocks May Extend Last Friday’s Rebound In Early Trading

Stocks are likely to move to the upside in early trading on Monday, extending the notable rebound seen during Friday’s session. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 259 points.

Traders may continue to pick up stocks at relatively reduced levels after the rally seen in the previous session halted a recent downward trend.

Positive sentiment may also be generated in reaction to upbeat earnings news from Goldman Sachs (GS), with the financial giant jumping by 3.8 percent in pre-market trading.

The advance by Goldman Sachs comes after the company reported second quarter results that exceeded analyst estimates on both the top and bottom lines.

On the other hand, shares of Bank of America (BAC) may move to the downside after the financial giant reported weaker than expected second quarter earnings.

Overall trading activity may be somewhat subdued, however, as traders look ahead to the release of earnings news from a slew of big-name companies later this week.

IBM Corp. (IBM), Johnson & Johnson (JNJ), Netflix (NFLX), Tesla (TSLA), American Express (AXP) and Twitter (TWTR) are among the companies due to report their quarterly results.

Traders may also be reluctant to make significant moves ahead of the Federal Reserve’s monetary policy decision next week, when the central bank is expected to raise interest rates by at least 75 basis points.

Shortly after the start of trading, The National Association of Home Builders is scheduled to release its report on homebuilder confidence in the month of July. The housing market index is expected to edge down to 66 in July from 67 in June.

After trending lower for several sessions, stocks showed a substantial move back to the upside during trading on Friday. With the strong upward move on the day, the Dow snapped a five-session losing streak.

The major averages saw further upside going into the close, ending the session at their best levels of the day. The Dow spiked 658.09 points or 2.2 percent to 31,288.26, the Nasdaq jumped 201.24 points or 1.8 percent to 11,452.42 and the S&P 500 surged 72.78 points or 1.9 percent to 3,863.16.

Despite the significant rebound on the day, the major averages all moved lower for the week. The Nasdaq slumped by 1.6 percent, the S&P 500 slid by 0.9 percent and the Dow edged down by 0.2 percent.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Monday, with the Japanese markets closed for a holiday. China’s Shanghai Composite Index jumped by 1.6 percent, while Hong Kong’s Hang Seng Index spiked by 2.7 percent.

The major European markets have also shown strong moves to the upside on the day. While the French CAC 40 Index is up by 1.1 percent, the U.K.’s FTSE 100 Index is up by 1.0 percent and the German DAX Index is up by 0.9 percent.

In commodities trading, crude oil futures are surging $2.19 to $99.78 a barrel after jumping $1.81 to $97.59 a barrel last Friday. Meanwhile, after edging down $2.20 to $1,703.60 an ounce in the previous session, gold futures are climbing $7.60 to $1,711.20 an ounce.

On the currency front, the U.S. dollar is trading at 138.35 yen versus the 138.57 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is trading at $1.0128 compared to last Friday’s $1.0080.

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