By Peter Nurse
Investing.com -- U.S. stocks are seen opening higher Tuesday, continuing the strong tone seen at the end of last month, amid growing optimism over the country’s economic recovery.
At 7:05 AM ET (1205 GMT), the Dow futures contract was up 200 points, or 0.6%, S&P 500 futures traded 20 points, or 0.5%, higher, and Nasdaq 100 futures climbed 45 points, or 0.3%.
The blue-chip Dow Jones Industrial Average gained just short of 2% in May, while the broad-based S&P 500 rose 0.6%, to mark their fourth consecutive positive months. The tech-heavy NASDAQ Composite gained just over 2% last week to post its best weekly performance since April, but it actually lost 1.5% in May, breaking a 6-month winning streak.
Confidence is growing about the strength of the country’s economic improvement as the country’s reopening accelerates, based on a ramped up vaccination program.
More than half the U.S. population has now received at least one dose of a Covid vaccination, according to CDC data posted Sunday, while there were just over 12,000 new cases on Saturday, the lowest since March 2020.
Friday’s May employment report is the major release on the week’s economic data slate, but ahead of that, May’s ISM Manufacturing PMI release is due at 10 AM ET (1500 GMT). This is expected to show a continued improvement in the sector, with the headline figure seen coming in 60.9, versus 60.7 in April.
Earlier Tuesday, data showed that Eurozone manufacturing activity expanded at a record pace in May, while China's factory activity expanded at the fastest pace this year.
In the corporate sector, the quarterly earnings season is largely at an end, but Zoom Video Communications (NASDAQ:ZM) and Hewlett Packard Enterprise (NYSE:HPE) are set to report results after the bell.
Elsewhere, software firm Cloudera (NYSE:CLDR) stock soared over 20% premarket after the Wall Street Journal reported that private-equity firms KKR and Clayton Dubilier & Rice are nearing a deal to buy the data-cloud company, which has a market value of nearly $4 billion, taking it private.
Crude oil prices were sharply higher Tuesday, with the international benchmark Brent topping $70 a barrel, amid growing optimism about the outlook for demand growth ahead of a meeting of major producers.
By 6:30 AM ET, U.S. crude was up 2.9% at $68.23 a barrel, while Brent was up 2.2% at $70.83, after earlier hitting the highest intra-day price since March 8.
The Organization of the Petroleum Exporting Countries and its allies, a grouping known as OPEC+, is due to meet later in the day. The cartel is widely expected to continue to gradually ease fuel supply curbs as planned over the next two months, particularly after one of its committees estimated that the oil glut built up during the pandemic has almost gone, and that stockpiles will diminish rapidly in the second half of the year.
The one fly in the ointment is a possible increase in Iranian output, as the Persian Gulf country and global powers continue to negotiate over the steps that Tehran must take regarding its nuclear activities to return to full compliance with the 2015 nuclear pact.