Pullback By Crude Oil Prices May Lead To Initial Strength On Wall Street

(RTTNews) - Stocks are likely to move to the upside in early trading on Monday, regaining ground following the slump seen last week. The major index futures are currently pointing to a higher open for the markets, with the S&P 500 futures up by 0.9 percent.

Early buying interest may be generated in reaction to a sharp pullback by the price of crude oil, which is plunging by 3.2 percent after soaring by 8.6 percent last week.

The pullback by the price of crude oil comes after President Donald Trump called on other countries to help secure the Strait of Hormuz.

"I'm demanding that these countries come in and protect their own territory, because it is their territory. It's the place from which they get their energy," Trump told reporters aboard Air Force One on Sunday. "And they should come and they should help us protect it."

"Why are we maintaining the Hormuz Strait when it's really there for China and many other countries?" he asked. "Why aren't they doing it?"

Bargain hunting may also contribute to initial strength on Wall Street after the major averages dropped their lowest closing levels in over three months last Friday.

Just before the start of trading, the Federal Reserve is scheduled to release its report on industrial production in the month of February. Industrial production is expected to inch up by 0.1 percent in February after climbing by 0.7 percent in January.

The National Association of Home Builders is also due to release its report on homebuilder confidence in the month of March not long after the start of trading. The housing market index is expected to tick up to 37 in March from 36 in February.

Following the sell-off seen during Thursday's session, stocks rebounded in early trading on Friday but showed a notable move back to the downside as the day progressed. The major averages pulled back well off their early highs and into negative territory.

The major averages added to the steep losses posted in the previous session, falling to new three-month closing lows. The Nasdaq slid 206.62 points or 0.9 percent to 22,105.36, the S&P 500 fell 10.43 points or 0.6 percent to 6,632.19 and the Dow dipped 119.38 points or 0.3 percent to 46,558.47.

For the week, the Dow plunged by 2.0 percent, the S&P 500 tumbled by 1.6 percent and the Nasdaq slumped by 1.3 percent.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Monday. Japan's Nikkei 225 Index edged down by 0.1 percent and China's Shanghai Composite Index slipped by 0.3 percent, while Hong Kong's Hang Seng Index jumped by 1.5 percent.

Meanwhile, the major European markets have all moved to the upside on the day. While the U.K.'s FTSE 100 Index is up by 0.7 percent, the German DAX Index is up by 0.6 percent and the French CAC 40 Index is up by 0.3 percent.

In commodities trading, crude oil futures are plunging $3.10 to $95.61 a barrel after surging $2.98 to $98.71 a barrel last Friday. Meanwhile, after slumping $64.10 to $5,061.70 an ounce in the previous session, gold futures are falling $34 to $5,027.70 an ounce.

On the currency front, the U.S. dollar is trading at 158.97 yen versus the 159.71 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is trading at $1.1480 compared to last Friday's $1.1416.