Dow futures climb nearly 200 points to kick off August trade

U.S. stock futures advanced on Monday, as investors eyed progress on an infrastructure bill, merger activity and a sign that central bank stimulus may continue.

What’s happening

Last week, the major stock market indexes dropped, with the S&P 500

losing 0.4% and Nasdaq Composite

dropping 1.1%, after the megacap tech companies reported quarterly results.

What’s driving markets

“The stars have aligned for stock markets, with a stellar earnings season being complemented by record-low real yields and hopes that Congress will deliver more fiscal juice soon,” said Marios Hadjikyriacos, senior investment analyst at XM. U.S senators over the weekend concluded the text of a $1 trillion infrastructure bill.

In a speech delivered Friday night, Fed Gov. Lael Brainard suggested that the central bank won’t announce a tapering of its bond purchase program at the Jackson Hole gathering at the end of the month. “I expect to be more confident in assessing the rate of progress once we have data in hand for September, when consumption, school, and work patterns should be settling into a post pandemic normal,” she said.

The September jobs data won’t come until Oct. 8, according to the Labor Department’s calendar of releases, and the next Federal Open Market Committee meeting after that will end Nov. 3.

The next jobs report, covering July, is scheduled for release on Friday. The Institute for Supply Management manufacturing report is due at 10 a.m. Eastern.

There were some deals announced, notably Square

buying Australian-listed buy-now pay-later company Afterpay


for $29 billion in an all-stock deal.

Parker Hannifin

said it’s buying U.K. engineering company Meggitt


for $9 billion in cash, a 71% premium to Friday’s close.

Other markets


and Hong Kong

stocks rose on Monday, and Chinese tech giant Alibaba

is due to report results on Tuesday, with its U.S.-listed shares having dropped 39% from its October peak.

European stocks

were on track to reach a new record high.

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