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Wall Street's main indexes posted their best weekly performance
in about a year on Friday, boosted by tumbling U.S. Treasury
yields as a weaker-than-expected monthly payrolls report spurred
hopes that the Fed could start cutting rates next year.
"US payroll report was at the sweet spot for markets- weak
enough to suggest that Fed should be done with rate hikes, but
not so weak as to raise alarm bells for the economy," said Mohit
Kumar, chief Europe economist at Jefferies in a note.
"As long as rates stabilise, equities can still have a leg
higher over coming weeks."
Traders' bets that the Fed will hold interest rates steady in
December stand at 90%, while pricing in an about 80% chance the
first policy easing would come as soon as June, according to the
CME Group's FedWatch tool.
Such expectations will be put to the test this week with a raft
of Fed policymakers, including Chair Jerome Powell due to speak
in the coming days.
Other speakers include voting members such as Federal Reserve
Board Governor Lisa Cook, New York Fed President John Williams
and Dallas Fed President Lorie Logan.
The yield on the benchmark ten-year Treasury note, which slid to
five-week lows on Friday, edged up to 4.59% on Monday.
Megacap stocks rose in premarket trading, with shares of Tesla
climbing 2.7% after a source told Reuters the electric automaker
plans to build a 25,000-euro ($26,838) car at its factory near
Berlin.
The economic-data calendar for this week is light, with weekly
jobless claims numbers due on Thursday and University of
Michigan’s consumer sentiment report on Friday.
Walt Disney, Instacart and Biogen are among major companies
reporting earnings this week.
403 companies in the S&P 500 have reported profits to date in
the third quarter, with 81.6% surpassing analyst estimates, per
LSEG data.
At 5:16 a.m. ET, Dow e-minis were up 28 points, or 0.08%, S&P
500 e-minis were up 8.5 points, or 0.19%, and Nasdaq 100 e-minis
were up 41.5 points, or 0.27%.
U.S.-listed shares of Chinese companies Alibaba, PDD Holdings,
Bilibili and Baidu were up between 1.4% and 3.6% premarket as
Beijing stepped up efforts to stabilise its markets.
(Reporting by Amruta Khandekar; Editing by Maju Samuel)
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