Stock futures rose slightly in overnight trading on Monday as the S&P 500 looks to wrap up its seventh straight month of gains at a record high.
Futures on the Dow Jones Industrial Average gained 35 points. S&P 500 futures edged up 0.1% and Nasdaq 100 futures were flat.
Zoom shares fell more than 11% in after-hours trading on Monday after the video-conferencing software company showed slowing revenue growth in the second quarter. The drop in shares came even as Zoom’s earnings beat estimates and the company raised full-year guidance as the pandemic took a turn for the worse.
Tuesday marks the last trading day of August, and major averages are poised to post solid gains. The S&P 500 is up 3% this month, while the tech-heavy Nasdaq Composite has climbed 4%, on pace to post its third winning month in a row. The blue-chip Dow is up a more modest 1.3%.
“Despite rising geopolitical risks, peak economic growth concerns, and the Federal Reserve moving closer to tapering its asset purchase program, the steady ascent of stocks continues,” Keith Lerner, chief market strategist at Truist, said in a note.
The S&P 500 managed to climb up a wall of worry to record highs without even a 5% pullback this year. The broad equity benchmark has rallied more than 20% in 2021 after notching its 53rd record close in Monday’s session.
Stellar corporate earnings have provided valuation support and the basis for stock prices to march higher. With the second-quarter reporting season winding down, the S&P 500 is on track to post an earnings growth rate of 95.4%, which would be the fastest pace since the fourth quarter of 2009.
“We believe we’re still in the early innings of the cycle and that strong economic and earnings growth and relatively low rates through 2022 should support higher equity prices and sustain the bull market,” Wells Fargo strategists said in a note.
Investors are awaiting a key jobs report on Friday ahead of the Labor Day weekend. Economists polled by Dow Jones expect 750,000 jobs were created in August and the unemployment rate fell to 5.2%.
On the political front, the Pentagon said the U.S. has finished its evacuation efforts from Kabul’s airport, effectively ending America’s longest war.