S&P 500 futures are gaining ground in premarket trading as traders look ready to buy stocks after yesterday’s pullback.
S&P 500 has moved away from all-time high levels in recent trading sessions which may attract speculative traders who are willing to be that current pullback will be quickly bought.
Meanwhile, the U.S. dollar remains under pressure against a broad basket of currencies, which shows that demand for safe-haven assets is decreasing. Dollar’s weakness provided some support to gold and silver, although gold failed to settle back above the key resistance level at $1800. Treasury yields are currently gaining some ground but remain well below recent highs which is bullish for stocks.
Producer Prices Increased By 0.7% In August
U.S. has just released Producer Prices report for August. The report indicated that Producer Prices increased by 0.7% month-over-month compared to analyst consensus which called for growth of 0.6%. On a year-over-year basis, Producer Prices grew by 8.3% compared to analyst consensus of 8.2%.
The report indicated that Producer Prices continued to grow at a fast pace, but it remains to be seen whether this data will have an impact on stock market dynamics. Most traders will likely wait for Inflation Rate and Core Inflation Rate reports which will be released next Tuesday. Currently, analysts expect that Inflation Rate will declined from 5.4% year-over-year in July to 5.3% in August. In case this report exceeds analyst expectations, stocks may find themselves under pressure.
WTI Oil Gets Back Above The $69 Level
WTI oil received strong support near $67.50 and moved back above the $69 level as worries about the spread of the Delta variant of coronavirus were offset by concerns about U.S. oil production recovery after Hurricane Ida.
This move highlights the strength of the current bullish trend in the oil market and shows that WTI oil has good chances to settle above the psychologically important $70 level and continue its upside move, which will be bullish for oil-related stocks.