Stocks Move Lower At The Start Of The Week

S&P 500 futures are moving lower in premarket trading as traders take some profits after the recent rebound.

The yield of 10-year Treasuries has recently made an attempt to settle below the support at the 20 EMA at 1.62% but failed to develop sufficient downside momentum and moved closer to 1.64%. Higher yields put some pressure on tech stocks in premarket trading as tech stocks remain sensitive to the developments in bond markets.

Meanwhile, the U.S. dollar is mostly flat against a broad basket of currencies as traders wait for additional catalysts. There is no flight to safety in the foreign exchange market which provides hope that the current pullback in the stock market is temporary.

Housing Market Stays Strong
The U.S. has just released NY Empire State Manufacturing Index report which indicated that NY Empire State Manufacturing Index declined from 26.3 in April to 24.3 in May compared to analyst consensus of 23.9.

Tomorrow, traders will have a chance to take a look at additional housing market data. Analysts expect that Building Permits declined by 0.9% month-over-month in April after growing by 2.7% in March. Housing Starts are projected to decline by 2.8% month-over-month in April.

Investors will keep a close eye on the situation in the housing market as it will provide a good opportunity to evaluate the impact of the recent increase in commodity prices on the housing industry.

WTI Oil Moves Back Below $65 As Colonial Pipeline Is Back To Normal Operations
Colonial Pipeline has managed to get back to normal operations over the weekend. While fuel shortages remained a problem in certain areas, the full restart of normal operations served as a bearish catalyst for the oil market.

In addition, traders look a bit worried about the situation with coronavirus in Asia. While recent reports indicated that the number of new coronavirus cases in India began to decline, the Indian variant of COVID-19 may begin to spread to other countries in the region. Malaysia has recently announced a nationwide lockdown, highlighting the risks to oil demand in Asia.

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