Dow Futures Rise 125 Pts; Optimism Rises Despite Record Covid Cases

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By Peter Nurse

Investing.com – U.S. stocks are seen opening marginally higher Tuesday, continuing the start of year rally based on faith in sustained growth and earnings momentum, looking through the short-term surge in Omicron Covid cases.

At 7 AM ET (1200 GMT), the Dow Futures contract was up 125 points, or 0.3%, S&P 500 Futures traded 18 points, or 0.4%, higher and Nasdaq 100 Futures climbed 50 points, or 0.3%.

The major indices closed higher on Monday, with the blue chip Dow Jones Industrial Average gaining almost 250 points, or 0.7%, to close at a record high. The broad-based S&P 500 rose 0.6%, also to a record close, while the tech-heavy Nasdaq Composite soared 1.2%.

This fast start to the new year followed last week’s strong close to 2021, which allowed the S&P 500 to close with a gain of nearly 27% in 2021.

Recent U.S. economic data have pointed to a robust recovery, and this week includes a set of numbers that will provide important signposts for the state of the labor market at the start of a year of potential Federal Reserve policy tightening.

The November Job Openings and Labor Turnover Survey is due at 10 AM ET (1500 GMT), and precedes Wednesday’s ADP payrolls release for December, Thursday’s weekly initial jobless claims and Friday’s official nonfarm payrolls report.

The U.S. registered a record number of new Covid cases on Monday, with a total of over a million infections, according to data from Johns Hopkins University.

Turning to the corporate sector, Verizon (NYSE:VZ) and AT&T (NYSE:T) are likely to be in the spotlight after agreeing Monday to delay the rollout of a new 5G service until Jan. 19.

Apple (NASDAQ:AAPL) is also likely to be in focus after the iPhone maker topped the $3 trillion threshold in market value, a little more than one year after breaking through the $2 trillion mark, while Tesla (NASDAQ:TSLA) announced it has opened a showroom in Xinjiang, making it the latest foreign firm to be caught up in controversy over alleged human rights abuses in the far-western Chinese region.

Oil prices edged higher ahead of a meeting of top producers to discuss future output levels. The Organization of the Petroleum Exporting Countries and allies, a grouping called OPEC+, will meet virtually later in the day, with the cartel expected to stick to its plan to increase output by 400,000 barrels per day in February. The group has fallen short of its quota allowances repeatedly in recent months, despite its official policy proclamations.

Investors also await U.S. crude oil supply data from the American Petroleum Institute, due later in the day.

By 7 AM ET, U.S. crude futures traded 0.3% higher at $76.29 a barrel, while the Brent contract edged 0.4% higher to $79.28. Both contracts jumped more than 1% on Monday.

Additionally, gold futures rose 0.2% to $1,803.85/oz, while EUR/USD edged 0.2% lower to 1.1277.

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