US pre-open: Stocks seen higher again on solid payrolls report
US futures pointed to another positive session on Wall Street on Monday as investors continued to cheer encouraging jobs data at the end of last week.
At 1240 GMT, Dow Jones Industrial Average and S&P 500 futures were up 0.2%, while Nasdaq futures were 0.4% higher.
Stocks racked up healthy gains on Friday after the non-farm payrolls report revealed the right combination of better-than-expected jobs growth but weaker-than-forecast wage growth.
Craig Erlam, senior market analyst at Oanda, said: "The numbers we saw on Friday provided the perfect balance of strong job creation and softer wage growth which does not necessarily trigger faster rate hikes. The much higher participation rate was a clear reminder that, while unemployment is at a 17-year low, there is still some slack in the economy which may take longer to sort out and explain why wage growth and inflation is so muted.
"This is why we didn’t see the kind of knee jerk reaction in the markets that we saw a month ago. Policy makers will likely be looking at the data and see it as evidence that slack still remains and no additional tightening is needed as a result of the strong employment gains. Of course, this is just one jobs report and future reports could show stronger wage growth but for now, investors are comfortable with the numbers."
An apparent softening in President Trump's stance on trade tariffs was also providing a boost to sentiment.
"Trump is clearly using these tariffs to force the hand of those allies that he believes are taking advantage of the US. Whether this is the best way to get more cooperation is another matter but investors are becoming more encouraged by his recent acknowledgement that a reduction could be imposed for some countries," Erlam said.
On the corporate front, Dow Chemical was in the black as it announced that long-time chief executive Andrew Liveris is stepping down.
Biogen was likely to be in focus as it agreed to buy Pfizer's schizophrenia drug for up to $590m.
Optical components manufacturer Oclaro surged in pre-market trade after it agreed to be bought by Lumentum Holdings in a deal valued at $1.8bn.
Elsewhere, Clorox said it had agreed to buy privately-held wealth and wellness company Nutranext for $700m.
There are no major US data releases due on Monday but things will pick up over the course of the week, with inflation and retail sales figures due.