U.S. stock futures edged higher on Monday on growing hopes that the United States and China would reach a trade deal as early as this month.
U.S. President Donald Trump and his Chinese counterpart Xi Jinping could sign a formal trade pact at a summit around March 27, the Wall Street Journal reported on Sunday.
The world’s two biggest economies appear close to a deal that would roll back U.S. tariffs on at least $200 billion worth of Chinese goods, a source briefed on the negotiations told Reuters on Sunday.
Among tariff sensitive names, Boeing Co eked out a 0.8 percent gain in light premarket trading, while chip stocks, including Intel Corp, Advanced Micro Devices Inc and Micron Technology Inc, rose between 0.5 percent and 0.7 percent.
“While there is renewed risk appetite, investors should consider how much upside is left given that markets have been actively pricing in the possible resolution to the trade saga,” Lukman Otunuga, Research Analyst at FXTM, wrote in a note.
Optimism on trade along with the dovish stance of the Federal Reserve has spurred a strong run in stocks, with the benchmark S&P 500 up 11.8 percent this year and about 4.5 percent away from its Sept. 20 record closing high.
Last week, the Nasdaq recorded its longest run of weekly gains since late 1999. Meanwhile, the S&P 500 breached its 2,800 level several times last week before closing above that level for the first time since Nov. 8 on Friday.
At 6:48 a.m. ET, S&P 500 e-minis were up 7.5 points, or 0.27 percent. Dow e-minis were up 72 points, or 0.28 percent and Nasdaq 100 e-minis were up 32.5 points, or 0.45 percent.
Among other early movers, Kraft Heinz Co gained 2.2 percent after brokerage Morgan Stanley raised rating on its shares.
Tesla Inc rose 0.9 percent after Chief Executive Officer Elon Musk said the electric carmaker would unveil its Model Y on March 14.
A U.S. Commerce Department report due at 10:00 a.m. ET is likely to show total construction spending rose 0.2 percent in December from a 0.8 percent rise a month earlier.
Amid a slew of economic data expected this week, investors will be closely watching the February non-farm payrolls report due on Friday to gauge the strength of the U.S. labor market.