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Stocks try to rebound before data

David Russell (david.russell@optionmonster.com)

Stocks are trying to rebound today as a busy news week gets underway.

S&P 500 futures are up about 0.25 percent. Europe is mixed, with Germany fractionally higher but Spain down almost 2 percent after a leftist rally in Madrid drew unexpectedly large crowds on Saturday. Shanghai led Asia lower overnight with a drop of 2.5 percent after Chinese manufacturing weakened more than previously expected. Oil rose again.

The Institute for Supply Management's key manufacturing index at 10 a.m. ET will probably be today's big item because it provides a forward-looking measure of economic activity. Similar reports recently have missed estimates as lower oil prices caused energy firms to slow capital investments. Personal income/spending and construction spending are due at 8:30 a.m. and 10 a.m., respectively, but those are less likely to affect sentiment.

The other big events this week include ADP's private-sector payrolls report on Wednesday and non-farm payrolls on Friday. Greece could also be in the news as Athens' new populist leaders attempt to negotiate new loans with European leaders.

Exxon Mobil, which announces quarterly results later this morning, inched higher in early trading as investors continue to look for a rebound in the energy sector after months of weakness. Crude oil is up about 2 percent this morning, following a 7 percent spike on Friday. Several companies in the group, including Cameron and FMC Technologies, also saw bullish option trades .

But momentum in the broader market appears to be slowing, with the S&P 500 closing below its 50-day moving average almost every session in January. The index has also failed to make new highs following a mid-December pullback, which contrasts notably with how it behaved at other times during the historic bull run of 2013 and 2014.

Our researchLAB market scanner shows negative returns in most major sectors recently, especially after poor results sank technology and financial stocks. But isolated groups such as supermarkets, video games, and IT outsourcing have done well. Gold and silver miners have been strongest overall.

Aside from oil's gain, there are no big important movers in commodity or foreign-exchange markets today.

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