S&P 500 rebounds after slump last week; Apple product event, inflation in focus

Investing.com -- US stocks opened higher on Monday, as equities on Wall Street rebounded after slumping in the prior session following an August jobs report that left traders uncertain about the size of potential Federal Reserve interest rate cuts.

By 09:40 ET (13:40 GMT), the Dow futures contract had gained 247 points or 0.6%, S&P 500 futures had increased by 46 points or 0.9%, and Nasdaq 100 futures had risen by 178 points or 1.1%.

"We don’t think the rally is being spurred by any specific news items out since the Fri[day] close but instead some (modest) dip buying driven in large part by oversold conditions and monetary support anticipation," analysts at Vital Knowledge said in a note to clients.

The main averages on Wall Street slipped on Friday after nonfarm payrolls figures for August showed continued slowing in the US labor market, fueling concerns over the broader economy and all but guaranteeing that the Fed will slash borrowing costs at its next two-day gathering from Sept. 17-18.

For the week, the benchmark S&P 500 and 30-stock Dow Jones Industrial Average both posted their largest weekly drops since March 2023, while the tech-heavy Nasdaq Composite logged its biggest dip since January 2022.

Potential Fed rate cut in focus

Investors' bets that the Fed will bring down rates by 25-basis points stood at 73% on Monday morning, according to the CME Group's (NASDAQ:CME ) closely-monitored FedWatch Tool.

Meanwhile, the probability of a 50-basis point cut stood at 27% after briefly jumping above 50% in the immediate wake of the jobs data.

The odds underline the ongoing uncertainty around how the central bank will react to the jobs report.

On Friday, Fed Governor Christopher Waller said "the time has come" for the Fed to decrease rates, but he remained open-minded about the depth and pace of the cuts.

Boeing shares jump after tentative union agreement reached

Shares in Boeing (NYSE:BA ) rose on Monday after it tentatively agreed to a 25% pay increase for its biggest union, possibly averting a damaging strike that threatens to heap further pressure on the embattled planemaker.

Along with the wage bump, the proposed four-year deal would also include a committment to build a new plane in the US Pacific Northwest, improved retirement benefits and an increase to the union's input into jet quality.

Union leadership, who represent over 30,000 workers, have recommended that members support back the agreement. However, if it is rejected and two-thirds vote to go on strike, the workers could stage a walkout at midnight on Friday.

A labor action would likely ratchet up scrutiny on new Boeing Chief Executive Kelly Ortberg, who is currently attempting to improve the company's finances and rebuild its reputation after dangerous mid-air door plug breach in January.

Elsewhere, shares in crypto-related stocks like digital coin exchange Coinbase (NASDAQ:COIN ) and crypto miners Cleanspark (NASDAQ:CLSK ) and Marathon Digital (NASDAQ:MARA ) advanced. The price of Bitcoin , the world's most well-known digital token, increased on Monday, extending its drive higher into a third-consecutive day.

Oil prices choppy

Oil prices wavered around the flatline on Monday as traders eyed the impact of a possible hurricane off the US Gulf Coast and gauged the market reaction to last week's nonfarm payrolls report.

By 09:45 ET, the Brent contract had dipped by 0.3% to $70.83 per barrel, while U.S. crude futures (WTI) were trading down by 0.3% at $67.44 a barrel. Brent had fallen by 10% at Friday's close to its lowest level since December 2021, while WTI had decreased to its lowest mark since June 2023, according to Reuters.

The US National Hurricane Center said over the weekend that a weather system in Gulf of Mexico is projected to turn into a hurricane prior to hitting the northwestern US Gulf Coast -- a crucial region for American refining capacity.

Elsewhere, the prospect of lower interest rates also helped support crude. In theory, a dip in borrowing costs could bolster economic activity and spur an uptick in oil demand.

However, executives at global commodity traders Gunvor and Trafigura told the Asia Pacific Petroleum Conference in Singapore that oil prices could trade in a range of $60 to $70 due in part to ongoing tepid demand in top oil importer China.

Reuters contributed to this report.

Source: Investing.com