U.S. Stocks May Regain Ground Following Last Friday's Sell-Off

(RTTNews) - Following the sell-off seen during last Friday's session, stocks are likely to move back to the upside in early trading on Monday. The major index futures are currently pointing to a sharply higher open for the markets, with the S&P 500 futures surging by 1.2 percent.

Traders may look to pick up stocks at somewhat reduced levels following the steep drop seen over the course of the previous session.

The major averages plunged to their lowest levels in a month amid concerns about a U.S.-China trade war, with President Donald Trump threatening a "massive increase" in tariffs on Chinese imports in retaliation for its expansion of export controls on rare earths.

Trump stuck a more conciliatory tone in a post on social media platform Truth Social on Sunday, helping to ease the trade war worries.

"Don't worry about China, it will all be fine!" Trump said. "Highly respected President Xi just had a bad moment. He doesn't want Depression for his country, and neither do I. The U.S.A. wants to help China, not hurt it!"

Overall trading activity may be somewhat subdued, however, with the Columbus Day holiday potentially keeping some traders away from their desks.

A lack of major U.S. economic data may also keep some traders on the sidelines, as the economic calendar is likely to remain quiet throughout much of the week due to the ongoing government shutdown.

The Bureau of Labor Statistics has revealed the report on consumer price inflation that had been due to be released on Wednesday will now be released on Friday, October 24th.

While no other releases will be produced until the resumption of regular government services, the BLS noted the consumer price index data allows the Social Security Administration to meet statutory deadlines necessary to ensure the accurate and timely payment of benefits.

Due to the lack of economic data, trading this week may be driven by reaction to the latest earnings news, with financial giants Citigroup (C), JPMorgan Chase (JPM), Wells Fargo (WFC), Bank of America (BAC) and Morgan Stanley (MS) among the companies due to report their quarterly results.

Stocks came under pressure in morning trading on Friday and saw further downside as the session progressed, ending the day substantially lower.

The Nasdaq and the S&P 500 pulled back further off Wednesday's record closing highs, plunging to their lowest closing levels in a month.

The major averages ended the day just off their lows of the session. The Nasdaq plummeted 820.20 points or 3.7 percent to 22,204.43, the S&P 500 tumbled 182.60 points or 2.7 percent to 6,552.51 and the Dow slumped 878.82 points or 1.9 percent to 45,479.60.

With the steep drop on the day, the major averages also posted significant losses for the week. The Dow dove by 2.7 percent, while the S&P 500 and the Nasdaq plunged by 2.4 percent and 2.5 percent, respectively.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Monday, with Japanese markets closed for a holiday. China's Shanghai Composite Index dipped by 0.2 percent, while Hong Kong's Hang Seng Index tumbled by 1.5 percent.

Meanwhile, most European stocks have moved to the upside on the day. The German DAX Index and the French CAC 40 Index are both up by 0.2 percent, although the U.K.'s FTSE 100 Index has bucked the uptrend and edged down by 0.1 percent.

In commodities trading, crude oil futures are climbing $0.49 to $59.39 a barrel after plummeting $2.61 to $58.90 a barrel last Friday. Meanwhile, after jumping $27.80 to $4,000.40 an ounce in the previous session, gold futures are spiking $103.50 to $4,103.90 an ounce.

On the currency front, the U.S. dollar is trading at 152.17 yen versus the 151.15 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is trading at $1.1568compared to last Friday's $1.1618.