By Peter Nurse
Investing.com – U.S. stocks are seen trading higher Monday, rebounding from their worst week in three months as retail investors turn their interest to silver, giving hedge funds a break.
At 7 AM ET (1200 GMT), the contract was up 232 points, or 0.8%, traded 38 points, or 1%, higher, and climbed 135 points, or 1.1%.
The main U.S. equity indices suffered their worst week since the end of October last week, with the at its lowest level since Dec. 14 and the at a one-month low.
This broad selloff occurred after a spike in retail demand to buy the stocks most bet against by hedge funds. These funds then had to liquidate large equity holdings to raise cash, hitting the wider market even as the stocks of companies like GameStop (NYSE:) soared.
GameStop stock is down 0.5% in premarket trading Monday, although the likes of AMC Entertainment (NYSE:) and BlackBerry (NYSE:) are still higher. But with popular online broker Robinhood continuing to impose on these companies, the attention of retail traders, via online chatrooms like Reddit, has turned towards silver.
The metal has soared to an eight-year high, while London-listed miners, including Fresnillo (LON:) PLC (OTC:), and Polymetal (OTC:) have posted strong gains.
On Capitol Hill, President Joe Biden is set to hold talks with 10 Republican lawmakers later Monday after they posted him a letter suggesting he scales back his $1.9 trillion Covid relief proposal in order to get cross-party support.
The earnings season continues this week, with almost 100 S&P companies set to report, including the likes of Alphabet (NASDAQ:), Amazon (NASDAQ:), Alibaba (NYSE:), Exxon (NYSE:), Biogen (NASDAQ:) and Pfizer (NYSE:).
Economic data due for release Monday includes the final reading of the figure for January, but most eyes will be on the January report at the end of the week. This will give markets the first look at the health of the labor market inherited by U.S. President Joe Biden.
Oil prices edged higher Monday, helped by newswires reports which suggested members of the Organization of Petroleum Exporting Countries are currently sticking to their agreed output targets, limiting supply despite prices trading above the $50 a barrel levels.
However, patchy coronavirus vaccine rollouts, doubts about the size of President Biden’s relief package and the speed of transmission by new variants of the virus are limiting gains.
futures traded 0.9% higher at $52.69 a barrel, while the international benchmark contract rose 1.3% to $55.72.
Elsewhere, rose 1% to $1,867.95/oz, helped by the surge in the junior metal, while traded 0.4% lower at 1.2085.