Stocks May Come Under Pressure In Early Trading - U.S. Commentary

(RTTNews) - Following the volatility seen last week, stocks are likely to come under pressure in early trading on Monday. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 67 points.

A disappointing report from the New York Federal Reserve on regional manufacturing activity may contribute to some early weakness on Wall Street.

The New York Fed said its general business conditions index tumbled to a negative 14.9 in August from a positive 3.9 in July, with a negative reading indicating a contraction in manufacturing activity.

The sharp drop came as a surprise to economists, who had expected the index to climb to a positive reading of 4.8.

With the unexpected decrease, the general business conditions index fell to its lowest level since hitting a negative 19.4 in April of 2009.

Not long after the open, the National Association of Home Builders is scheduled to release a separate report on homebuilder confidence in the month of August.

The housing market index is expected to edge up to 61 in August after holding at a nearly ten-year high of 60 in July.

Nonetheless, overall trading activity may be somewhat subdued, as many traders will be away from their desks to take advantage of the waning summer.

Traders may also look ahead to the release of the minutes of the Federal Reserve's latest monetary policy meeting on Wednesday.

The minutes are likely to be closely analyzed for hints regarding whether the Fed will begin raising interest rates at its next meeting in September.

Reports on consumer price inflation, housing starts, and existing home sales are also likely to attract attention in the coming days.

While trading activity was somewhat subdued, stocks moved mostly higher over the course of the trading day on Friday. The upward move on the day came on the heels of the lackluster performance that was seen last Thursday.

The major averages pulled back off their best levels going into the close but remained in positive territory. The Dow climbed 69.15 points or 0.4 percent to 17,477.40, the Nasdaq edged up 14.68 points or 0.3 percent to 5,048.24 and the S&P 500 rose by 8.15 points or 0.4 percent to 2,091.54.

With the gains on the day, the major averages all moved higher for the week. While the Nasdaq inched up just 0.1 percent, the Dow and the S&P 500 advanced by 0.6 percent and 0.7 percent, respectively.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Japan's Nikkei 225 Index rose by 0.5 percent, while Hong Kong's Hang Seng Index fell by 0.7 percent.

Meanwhile, the major European markets have all moved to the downside on the day. While the German DAX Index has tumbled by 1.1 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index are down by 0.5 percent and 0.3 percent, respectively.

In commodities trading, crude oil futures are sliding $0.74 to $41.76 a barrel after falling $2.04 or 4.7 percent to $42.50 a barrel in the week ended August 14th. Gold futures, which rose $18.60 or 1.7 percent to $1,113.80 an ounce last week, are climbing $8.20 to $1,120.90 an ounce.

Among currencies, the U.S. dollar turned in a mixed performance last week. The greenback edged up 0.1 percent against the yen before ending the week at 124.31 yen, while it retreated 1.3 percent against the euro to $1.1109. The dollar is currently trading at 124.28 yen and is valued at $1.1121 versus the euro.