By Peter Nurse
Investing.com - U.S. stocks are seen opening lower Monday, consolidating off record highs as Covid-19 cases continue to surge and investors await details of additional fiscal stimulus.
At 7:05 AM ET (1205 GMT), the Dow Futures contract was down 230 points, or 0.8%, S&P 500 Futures traded 26 points, or 0.8%, lower, and Nasdaq 100 Futures dropped 88 points, or 0.7%.
The Dow Jones Industrial Average climbed 1.6% last week, closing at a record high, while the S&P 500 gained 1.8% and the tech-heavy Nasdaq Composite rose 2.4% in the prior week, both also recording all-time closing highs.
Wall Street is expected to give back some of those gains early Monday as the country struggles to cope with the surge in Covid-19 cases despite the attempted ramp-up of the vaccination program.
The United States is now averaging 3,000 deaths and 245,000 new cases a day, according to Reuters data, with almost half of the states setting records for daily infections this month. This is stretching healthcare systems to their breaking points.
Many countries in Europe are in lockdown as the cases there surge with a new highly-transmissible strain circulating, while China saw its biggest daily increase in coronavirus cases in more than five months,
Some help may be on the way as President-elect Joe Biden touted Friday a new Covid-relief package, which he said will be “in the trillions of dollars.” More details are expected to emerge later in the week.
The political climate in Washington DC remains fraught, with Democratic-led efforts to impeach President Donald Trump for his role in Wednesday’s violent protests in the Capitol gaining momentum.
In corporate news, the social media giants, including Twitter (NYSE:TWTR) and Facebook (NASDAQ:FB), will be in focus as they have banned Trump from their sites after Wednesday’s furore, while the earnings season starts later in the week, with the big banks up first.
The economic data slate is relatively quiet Monday, but consumer price inflation is due on Wednesday, while retail sales figures for December are scheduled for Friday.
Oil prices weakened Monday amid concerns of declining fuel demand following a jump in new Covid-19 cases in China, the world’s second-largest consumer of crude.
Still, prices remain above the $50 a barrel level, supported by Saudi Arabia's surprise pledge last week to cut output by 1 million barrels per day for two months.
U.S. crude futures traded 0.5% lower at $51.98 a barrel, while the international benchmark Brent contract fell 1% to $55.42.
Elsewhere, gold futures rose 0.7% to $1,848.65/oz, while EUR/USD traded 0.4% lower at 1.2165.