Futures edge lower after five-week rally

Reuters News
Posted: Sep 08, 2014 7:14 AM

By Ryan Vlastelica

NEW YORK (Reuters) - U.S. stock index futures are slightly lower on Monday, with investors finding few reasons to extend a long-running rally that has taken indexes to repeated records amid overseas concerns and few domestic catalysts.

Equities have risen for five straight weeks, with the S&P 500 ending at a record on Friday after a payroll report that was much weaker than expected. While the report pointed to a labor market that continues to struggle, it also reassured investors that the Federal Reserve would not raise interest rates any time soon, creating an environment that continues to be positive for stocks.

The S&P 500 briefly fell below its 14-day moving average on Friday, although the benchmark index rebounded and closed well above it, a positive sign for near-term momentum. The CBOE Volatility index, a measure of investor anxiety, is hovering near 12, well below its long-term average of 20.

Central bank policy was also in focus abroad as China's import growth unexpectedly fell for the second consecutive month in August, its worst performance in more than a year and stoking speculation about whether authorities should loosen policy further to revive domestic demand.

The ceasefire struck between Ukrainian government forces and pro-Russian separatists was largely holding in eastern Ukraine, although Kiev accused the rebels of sporadic violations Sunday night. A resurgence of violence in the region could spur investors to take profits.

European shares are sharply lower, down 0.8 percent, pressured as an opinion poll showed supporters of Scottish independence from Britain taking the lead for the first time since the referendum campaign began.

Analysts and economists have questioned whether an independent Scotland will be able to host such large banks as Lloyds Banking Group and Royal Bank of Scotland. U.S. shares of Lloyds are down 4.5 percent to $4.59 in premarket trading.

Futures snapshot at 6:54:

S&P 500 e-minis are falling 3 points, 0.15 percent with 83,565 contracts changing hands.

Nasdaq 100 e-minis are down 3.5 points, 0.09 percent in volume of 13,592 contracts.

Dow e-minis are down 27 points, 0.16 percent with 13,966 contracts changing hands.

(Editing by Lisa Von Ahn)