Wall Street was poised to fall nearly 1 percent at the open on Monday, weighed by worries about the potential strength and timing of an economic recovery as a slump in oil prices was set to pressure energy shares.
Oil touched a five-week low and fell to around $64 a barrel as investors remained cautious over the prospects of a speedy global economic turnaround in the wake of last week's grim U.S. jobs data. Shares of Exxon Mobil were down 1.7 percent at $67.30 in premarket trade.
Although the weaker oil prices bode well for recession-weary consumers, strong commodity prices have been viewed as a signal the global economy is stabilizing.
Last week's much weaker-than-expected jobs data weighed heavily on the market as investors questioned what the economic recovery will look like and when improvement will be seen.
The S&P 500 is up 32.5 percent from March's 12-year lows after a rally spurred by bets the economy will show signs of recovery later in the year. The market run-up has stalled of late as investors have become more cautious and booked some profits.
Market-watchers were also focusing on the start of earnings season, which kicks off with Alcoa Inc this week.
A little bit of fear factor is back into the marketplace, said Peter Cardillo, chief market economist at Avalon Partners in New York.
The unemployment report was not a good report, and it does cast some doubt, but I don't think it reverses the trend (of stabilization), he said.
Investors will take in the latest data with a look at the services sector as the Institute for Supply Management releases its June nonmanufacturing index at 10:00 a.m. EDT.
Economists' median forecast in a Reuters poll call for a nonmanufacturing index reading of 46.0, below the 50 mark which divides expansion from contraction but up from May's reading of 44.0.
S&P 500 futures fell 7.5 points and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures slid 57 points, and Nasdaq 100 futures lost 7 points.
A U.S. judge on Sunday approved General Motors Corp's bankruptcy sale in a move that will allow the company's most profitable assets to exit bankruptcy protection under government ownership.
Over the weekend, Vice President Joe Biden said the White House does not favor another stimulus package now, though he said that when the current administration came into office, it misread how bad the economy was.
Stocks tumbled on Thursday, driving the S&P 500 down to its third-straight weekly loss after data showed a slide in June non-farm payrolls. U.S. markets were closed on Friday for the Independence Day holiday.
(Editing by Padraic Cassidy)