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US equity futures rose, signaling gains for major indices in early August as investors cheer for strong earnings growth.
Futures contracts linked to the S&P 500 rose 0.5% on Monday. The gauge of US large-cap stocks closed its sixth consecutive monthly advance on Friday, although stock prices have occasionally faltered in recent weeks.
Contracts for the tech-focused Nasdaq-100 index also rose 0.5% on Monday. Futures contracts for the Dow Jones Industrial Average advanced 0.4%.
Investors are optimistic that the economic expansion will boost corporate earnings and allow stocks to continue to rise, albeit at a slower pace. Some fear that the highly contagious Delta strain of the coronavirus, a prolonged period of inflation and China’s efforts to curb tech companies could lead to bouts of volatility.
“There are a few good reasons why the economy will continue to grow at above-normal rates,” said Edward Smith, co-chief investment officer of UK investment firm Rathbone Investment Management. Consumers are spending freely, businesses are planning to invest in their businesses, and businesses are restocking their inventory, he said.
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