Stock futures increase as online traders send a silver increase

The Cboe volatility index, an indicator of stress on the US stock market, fell almost 5% on Monday after gaining 45% in January. Some investors expect volatility to decline this week, as many hedge funds have already reduced short positions in stocks that have attracted huge attention on the Internet.

In premarket trading, some of the most traded stocks among individual investors widened recent gains. AMC Entertainment Holdings AMC 53.65%

met 22% Monday before the market opened, while headset maker Koss gained 7% and GameStop rose 4.6%.

“There has always been, in the financial markets, a desire on the part of investors to get rich quick and therefore you can still end up with isolated incidents in which you end up with volatile behavior of certain assets,” Mark Dowding said , chief investment officer of BlueBay Asset Management.

The broader stock market is likely to continue the rally this year, he added. “We believe the markets will do very well in the short term because you hope the economies will improve and we have great political support,” Dowding said.

A recent drop in U.S. Covid-19 infection rates is likely to support market sentiment and allow stocks to recover from some of Friday’s losses, said Patrick Spencer, CEO of U.S. investment firm Baird. Recently recorded coronavirus cases fell on Sunday compared to the previous day, as did hospitalizations and deaths.

“People were very conservative over the weekend and news of the coronavirus and continued central bank stimulation will increase momentum,” Spencer said. “You still have a lot of money aside that you want to get back on the market.”

Silver prices rose, fueled by a new wave of enthusiasm from online retailers. The move indicates that the recent volatility recession is likely to spread in a second week in at least some pockets of the global financial market.

The most actively traded silver futures rose more than 10% to $ 29.70 a troy ounce, their highest level since February 2013. The precious metal has gained in recent sessions after users of the Reddit’s WallStreetBets forum posted the execution of a “short squeeze” similar to those credited with fueling recent gains in other stocks such as GameStop and AMC. This suggests that individual investors assume hedge funds that are betting on falling silver prices.

“I totally underestimated it,” Carsten Fritsch, a commodity analyst at Commerzbank, said. “I never imagined this could ever happen in a serious, big market like silver.”

In bond markets, the yield on the 10-year Treasury note fell to 1.076%, from 1.090% on Friday. Yields fall when prices rise.

Investors continue to monitor the corporate earnings season, and this week they presented 111 companies in the S&P 500 index. The results of major technology companies, including Amazon.com and Alphabet, will be presented on Tuesday.

The manufacturing index of the Institute of Supply Management in January, which is expected at 10 am (ET), is expected to show that the activity of the American factory continued to expand, all and that perhaps at a slower pace than in previous months.

Abroad, the Stoxx Europe 600 pancontinental advanced 1.3%.

In Asia, benchmark indices closed more. Kospi of South Korea rose 2.7% and Hang Seng of Hong Kong advanced 2.2%. China’s Shanghai Composite gained 0.6%.

Write to Caitlin Ostroff to [email protected]