By Peter Nurse
Investing.com – U.S. stocks are seen opening lower Tuesday, handing back some of the previous session’s strong gains – although losses are limited as Treasury yields stabilize.
At 7 AM ET (1200 GMT), the contract was down 55 points, or 0.2%, traded 10 points, or 0.3%, lower, and dropped 44 points, or 0.3%.
Wall Street started the new month on a strong note Monday, with the broad-based closing 2.4% higher, its best day since June, while the added 2% and the tech-heavy 3%, their best trading days since November.
Investors have been generally confident of economic growth going forward as the vaccination program ramps up, the Federal Reserve continues with its easy money policies and the Biden administration pushes forward with its proposed $1.9 trillion stimulus package.
The U.S. Senate will begin debating the coronavirus relief bill this week, Senate Majority Leader Chuck Schumer said on Monday, after it made its way through the House of Representatives over the weekend. It will do so without any provision for raising the federal minimum wage to $15, a retreat that has angered the left wing of the Democratic Party.
Still, worries still exist that stock markets are over-extended as the prospect of persistent inflation has led to concerns that monetary policy may have to be tightened sooner than expected.
U.S. Federal Reserve governor will speak later Tuesday, as will San Francisco Fed President . .However, with their colleagues all expressing a lack of worry about inflation or asset prices, the potential for any upset looks limited.
For now, bond yields have stabilized at Monday’s levels, with the benchmark currently trading around 1.43%, lower than the 1.60% level that it briefly touched last week.
Meanwhile, in the corporate sector, retailers will be in focus Tuesday, with Target (NYSE:) and Kohl’s (NYSE:) publishing figures on Tuesday. Additionally, movie theatre chain AMC Entertainment (NYSE:) is likely to report bleak fourth-quarter numbers, while Zoom Video Communications (NASDAQ:) will also be in the spotlight after it released stellar numbers late Monday.
Oil prices weakened Tuesday, as traders turned their attention towards the upcoming meeting of the Organization of the Petroleum Exporting Countries and their allies including Russia, a group known as OPEC+, on Thursday.
These top producers are currently holding back some seven million barrels per day, or 7% of global supply, from the market, but could sanction the return of some of this to the market given the recent rises in oil prices.
Also of interest will be oil supply data from the , due later in the session.
U.S. crude futures traded 0.1% lower at $60.59 a barrel, while the international benchmark contract fell 0.2% to $63.55.
Elsewhere, rose 0.2% to $1,727.05/oz, while traded 0.1% lower at 1.2030.