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Dow Jones futures surge 473 points following shortened week

Futures markets suggest the DJIA will open higher on Monday, 6 July.

Dow Jones futures in focus, Chinese stocks rally 5.67%

The Dow Jones Industrial Average (DJIA) finished last week in positive territory – with better than expected jobs data and promising results from early-stage Covid-19 vaccine trials looking to have overshadowed concerns above the spread of the virus.

To round out the shortened week, on Thursday the DJIA finished out the session up 0.36% at the 25,827 point level – with Walgreens Boots Alliance, Pfizer and Dow leading the gains. By comparison, Cisco, Walt Disney and JPMorgan Chase were the worst performing Dow constituents.

The S&P 500 benchmark also traded higher on Thursday, while the tech-focused Nasdaq Composite was flat. The Facebook (FB) share price continued to come under pressure on Thursday, finishing out the session down 1.74% to US$233.42 per share – as large-cap advertisers continue to abandon the platform.

Even so, FB was up in pre-market trading today.

Catalysts in focus

Examining what drove last week’s market moves, as IG’s market analyst, Kyle Rodda, wrote on Monday morning:

‘It was a quiet end to the trading week for financial markets on Friday, with US markets offline for the Independence Day holiday. Overall, price action pointed to a general aversion to risk taking, amidst a dearth of economic and corporate news.’

‘Economic data proved a catalyst for risk assets, as on balance, key economies across the globe re-open, despite the clear increase in COVID-19 cases across the world,' Mr Rodda added.

Looking forward, as of 4:37AM (New York time), Dow Jones futures were trading up 473 points or 1.84%, suggesting the key US benchmark would open in the green on Monday, 6 July.

As Dow futures trade higher, markets across the Asian Pacific region proved a mixed bag on Monday, 6 July: Australia’s ASX 200 benchmark floundered; while China’s CSI 300 capped off a week of strong gains, rising 5.67% to close at 4,670 points.

At today’s close, the Chinese market is now up ~13% in just five trading sessions.

Data releases for investors to watch

Elsewhere, on Tuesday consumer confidence index data (June) is set to be released; on Wednesday Markit and ISM manufacturing index data (June) is set to be released, and on Thursday, nonfarm payrolls, unemployment rate, and initial and continuing jobless claims data is set to be released.

From an earnings perspective, while there are no significant earnings releases due out this week, for the week ending 17 July – both financial heavyweights: Citigroup and JPMorgan are set to release their second quarter results on 14 July and 16 July, respectively.

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This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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