US pre-open: Stocks to fall after last week's gains
US stocks were set for a weaker open on Monday following record highs last week.
At 1030 GMT, Dow Jones Industrial Average futures were down 0.2%, while S&P 500 and Nasdaq futures were 0.6% and 1% lower, respectively. Meanwhile, the dollar was firmer amid rising bond yields.
Political developments were set to be in focus after House Speaker Nancy Pelosi said over the weekend that the House was prepared to launch impeachment proceedings against Donald Trump as early as this week.
Naeem Aslam, chief market analyst at Ava Trade, said: "Overall, there are chances that we may get to see some more political turmoil in the US after the massive violence on Capitol Hill. Lawmakers have started the process to impeach President Trump, but the fact is that there is not enough time left for this process to see the light at the end of this tunnel. The impeachment proceedings are likely to shape up in the House of Representatives, and this means more volatility for the US stock market. These small bumps may not be able to distract investors too much as their focus is beyond these events."
Aslam said the current retracement being seen in US stock futures may not last for long as investors are still very much optimistic about more stimulus aid packages coming out of the US. He said the fact that all the election drama is pretty much over and the new administration is determined to restore economic growth mean traders may soon begin to bag some bargains.
"President-elect Joe Biden pledged a hefty stimulus aid package during his speech on Friday. He has once again assured Americans that the new stimulus aid package would be in trillions, not in billions. Clearly, Biden has some serious, ambitious, and investors are hopeful about his view of the economy," Aslam said.
This week marks the start of the fourth-quarter earnings season in the US, with big banks such as JPMorgan Chase, Wells Fargo and Citigroup all due to report on Friday.
"Whilst the earnings numbers will be important, guidance on the upcoming Q1 and Q2 2021 quarters will no doubt be more important than ever," said Neil Wilson, chief market analyst at Markets.com.
Later in the day, Boeing shares could be active after a crash over the weekend involving a 737-500 aircraft in Indonesia.
Twitter was also likely to be in focus again, with the shares down sharply in pre-market trade after it suspended US President Donald Trump from its platform last week.