Stocks May Add to Last Week’s Losses in Early Trading
By Investors Hub
The major U.S. index futures are pointing to a lower open on Monday, with stocks likely to add to the steep losses posted last week
Lingering concerns about the outlook for the global economy may generate some selling pressure along with uncertainty about the potential for a trade deal between the U.S. and China.
At the Asia Pacific Economic Cooperation summit on Saturday, Vice President Mike Pence said the U.S. would not back down until China changes its ways.
The stark warning dampened investor hopes for a thaw in U.S.-Chinese trade relations ahead of the G20 summit later this month in Argentina.
A pullback by shares of Apple (AAPL) may also weigh on the markets, with the tech giant moving notably lower in pre-market trading after a report from the Wall Street Journal said the company slashed production orders for all three of the iPhone models that were unveiled in September.
Stocks showed a lack of direction during trading on Friday following the substantial rebound seen over the course of Thursday?s session. The major averages spent much of the day bouncing back and forth across the unchanged line before ending the session mixed.
While the tech-heavy Nasdaq slipped 11.16 points or 0.2 percent to 7,247.87, the Dow climbed 123.95 points or 0.5 percent to 25,413.22 and the S&P 500 rose 6.07 points or 0.2 percent to 2,736.27.
For the week, the major averages all posted steep losses. While the Dow plunged by 2.2 percent, the Nasdaq tumbled by 2.1 percent and the S&P 500 slumped by 1.6 percent.
The choppy trading on Wall Street came as traders seemed reluctant to make more significant moves amid lingering uncertainty about the global economic outlook and renewed anxiety about Brexit.
Buying interest was generated in mid-day trading, as President Donald Trump told reporters China “wants to make a deal” on trade.
Trump said China has provided a “large list” of trade items the communist country is willing to compromise on but argued any trade deal has to be “reciprocal.”
The comments generated optimism about a U.S.-China trade deal, although White House officials subsequently told CNBC people should not read too much into the president’s claims.
Meanwhile, traders largely shrugged off a report from the Fed showing a slight uptick in industrial production in the month of October.
The Fed said industrial production inched up by 0.1 percent in October after rising by a downwardly revised 0.2 percent in September.
Economists had expected industrial production to rise by 0.2 percent compared to the 0.3 percent increase originally reported for the previous month.
Utilities stocks rebounded strongly from recent weakness, with the Dow Jones Utility Average jumping by 2 percent after ending the previous session at its lowest closing level in well over a month.
PG&E (PCG) posted a standout gain after California Public Utilities Commission President Michael Picker reportedly told Wall Street analysts he could not imagine allowing the utility company to go bankrupt.
Significant strength also emerged among housing stocks, as reflected by the 1.4 percent advance by the Philadelphia Housing Sector Index.
Gold, biotechnology, and commercial real estate stocks also saw considerable strength on the day, while notable weakness remained visible among semiconductor stocks.