S&P 500 futures are gaining some ground in premarket trading as traders look ready to buy stocks after yesterday’s strong upside move.
Yesterday’s trading action indicated that there is plenty of money on the sidelines which is waiting for any meaningful pullback. There was no specific catalyst for the strong move, and it looks that “buy the dip” mentality served as the main catalyst that pushed stocks higher.
Today, Treasury yields are rising as traders sell U.S. government bonds, which is bullish for the stock market as falling bond prices indicate that demand for safe-haven assets is decreasing.
WTI Oil Tries To Settle Above The $68 Level
WTI oil is currently trying to settle above the $68 level, and oil-related stocks will move higher at the beginning of today’s trading session.
The recent API Crude Oil Stock Change report indicated that crude inventories increased by 0.8 million barrels compared to analyst consensus which called for a decline of 4.2 million barrels.
However, the market ignored the report as traders bet that the surge in the number of new coronavirus cases caused by the Delta variant will not hurt demand for oil.
Today, traders will focus on EIA Weekly Petroleum Status Report, which is projected to show that crude inventories declined by 4.5 million barrels. If the report is worse than expected, oil may find itself under some pressure, but general market sentiment will likely serve as the main catalyst.
Gold Drops To The $1800 Level
Gold received some support from demand for safe haven assets in recent trading sessions and managed to stay above the $1800 level despite the strength of the U.S. dollar.
Today, gold is trying to settle below the psychologically important $1800 level which is bearish for gold mining stocks.
Shares of gold miners have been under pressure in July despite gold’s upside move, highlighting the bearish market sentiment towards the sector. In this light, gold mining stocks will likely be sensitive to the recent downside move in the gold market.