Stock futures rise to recover from bear market

US stock futures rose Monday morning, with stocks taking a seven-week loss streak on a more solid footing as investors shook off some recent volatility and digested new trade-related comments from the Biden administration.

Contracts on the S&P 500 gained more than 1% in early trading. The index closed Friday’s session flat for the day, but fell 18.7% from its all-time high of January 5 to come within striking distance of a bear market defined as soon as an index closes at least 20% from a recent all-time high. -time closing height. †

Dow futures gained more than 300 points, or 1.1%, and Nasdaq futures were also up more than 1% during pre-market trading. The upward move came after President Joe Biden said he was considering easing tariffs on Chinese goods imposed during the previous administration. Biden’s comments, made at a news conference with Japanese Prime Minister Fumio Kishida, came in turn after Treasury Secretary Janet Yellen said last week she was encouraging the Biden administration to abolish tariffs it says “do more damage.” to consumers and businesses” in the US

The possibility of some easing in rates as the U.S. economy grapples with decades of high inflation has contributed at least temporarily to a temporary increase in risky assets that had been battered in recent weeks by jitters over rising prices, more aggressive monetary policy from the Federal Reserve and international concerns in Ukraine and China. On Friday, the S&P 500 also posted a seventh straight week loss in its longest losing streak since 2001. And at its worst on Friday, the index fell a whopping 20.6% from January’s record bear trading record. market area.

Traders work on the floor during the opening bell of the New York Stock Exchange in New York City on May 16, 2022. - US stocks started off gloomy Monday after rallying in the previous session, as concerns about growth in domestic and global economies continue .  (Photo by TIMOTHY A. CLARY/AFP) (Photo by TIMOTHY A. CLARY/AFP via Getty Images)

Traders work on the floor during the opening bell of the New York Stock Exchange in New York City on May 16, 2022. – US stocks started off gloomy Monday after rallying in the previous session, as concerns about growth in domestic and global economies continue . (Photo by TIMOTHY A. CLARY/AFP) (Photo by TIMOTHY A. CLARY/AFP via Getty Images)

Since World War II, there have been 12 formal bear markets for the S&P 500, according to LPL Financial Chief Market Strategist Ryan Detrick, and 17 including near bear markets, or periods in which the index fell by more than 19%. Of these, the average decline was about 29.6% and lasted an average of 11.4 months.

However, when bear markets coincide with recessions, they tend to be worse, with an average decline of 34.8% and a duration of 15 months, Detrick added. A recession is usually considered after two consecutive quarters of negative GDP (gross domestic product) growth.

Traders will receive the second estimate of US GDP for the first quarter later this week, which had shrunk by an annualized rate of 1.4% last month according to the first estimate. More recent economic data, however, has shown some strengths, with retail sales and some manufacturing data coming in strongly, while employment data has started to weaken.

“I really think the economy is better than the stock market is telling you right now,” Rhys Williams, chief strategist at Spouting Rock Asset Management, told Yahoo Finance Live on Friday. “And I think we’ll be muddling through the summer with both stocks and bonds.”

7:23 a.m. ET: Stock futures gain more than 1%

  • S&P 500 futures (NL=F: +47.5 points (+1.22%) to 3,947.00

  • Dow futures (YM=F: +346.00 points (+1.11%) to 31.559.00

  • Nasdaq futures (NQ=F +127.25 points (+1.07%) to 11,968.00

  • rough (CL=F: +$1.08 (+0.98%) to $111.36

  • Gold (GC=F: +$16.90 (+0.92%) to $1,859.00 per ounce

  • 10-year treasury (^TNX: +4.6 fps to yield 2.833%

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter

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