U.S. stock index futures point to a higher open on Monday as signs of economic recovery on the back of strong jobs data for the month of May continued to support market sentiment.
Futures on the Dow Jones Industrial Average were up 0.30 percent, while futures on the Standard & Poor's 500 Index were up 0.37 percent and those on the Nasdaq 100 Index were up 0.36 percent.
Market sentiment improved on Friday after the U.S. Department of Labor reported that the economy added 175,000 jobs in May, better than the average estimate of 160,000 jobs, easing fears that the strength of recovery in the world's largest economy was losing steam.
At the same time, the data did not add to existing fears about the future of the Federal Reserve's bond-buying program because the uptick in employment while positive was not too strong, and the unemployment rate actually edged up to 7.6 percent from 7.5 percent in the previous month.
"The number had a little something in it for everybody, in terms of those who suspect tapering might begin sooner and those who think it might start later," Mark Luschini, chief investment strategist of Janney Montgomery Scott in Philadelphia, told Reuters, adding that the May payrolls figure could "prime market participants to be more positive toward equities leading into this week's trading."
Meanwhile, market participants are likely to focus on the speech of James Bullard, head of the Federal Reserve Bank of St. Louis, at 9:50 a.m. EDT for further hints about the Fed’s future policy stance. Bullard had mentioned earlier that he wants to continue with the $85 billion-a-month bond purchase program as long as falling inflation -- well below the Fed's 2-percent target right now -- remains a concern.
“Bullard does not favor reducing asset purchases while inflation is falling. Despite the upbeat May jobs data, the fact remains that the employment sub-indices in both the ISM surveys, both manufacturing and services, have fallen to borderline levels of 50.1,” a note from DBS Group Research said.
European markets were mixed in early trade on Monday after surging in the previous session. London’s FTSE 100 was down 0.10 percent and Germany's DAX-30 gained 0.61 percent, while France's CAC-40 declined 0.08 percent.
Earlier, Asian markets mostly ended on a positive note, with Japan’s Nikkei climbing more than 4.9 percent on the back of a weaker yen, a surge in current account surplus, and revised growth data. The Nikkei climbed 4.94 percent and Hong Kong's Hang Seng rose 0.18 percent, while South Korea's KOSPI advanced 0.46 percent and India's BSE Sensex was trading up 0.41 percent in late afternoon trade.
Exporter companies’ shares rallied in Tokyo as the U.S. dollar rose to 98.30 yen after plunging to below 95 levels on Friday. Meanwhile, official data on Monday showed that Japan’s economy grew at an annual rate of 4.1 percent in the January-March quarter, better than an earlier estimate of 3.5 percent.