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U.S. Stocks May Open Lower Amid Spike In Oil Prices

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Stocks may move to the downside in early trading on Monday, giving back ground following the upward move seen last week. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 80 points.

A spike in the price of crude oil may weigh on the markets, with brent crude futures showing the biggest intraday jump on record after a coordinated drone attack on Saudi Arabia's oil industry.

Crude for October delivery is soaring $5.54 to $60.39 a barrel, raising concerns about the impact of higher energy prices on the already fragile global economy.

The jump in oil prices comes as attacks on an oil processing facility at Abqaiq and the nearby Khurais oil field cut Saudi Arabia's daily crude oil output in half.

Responding to the news, President Donald Trump said he has authorized the release of oil from the Strategic Petroleum Reserve if necessary to keep the markets well-supplied.

Trump also tweeted the U.S. is "locked and loaded" to the respond to the attacks, with Secretary of State Mike Pompeo pointing the finger at Iran.

A potential military conflict between the U.S. and Iran would weigh on a global economy that is already being dragged down by the U.S.-China trade war.

On the U.S. economic front, the Federal Reserve Bank of New York released a report showing New York-area manufacturing activity was little changed in the month of September.

The New York Fed said its general business conditions index dipped to 2.0 in September from 4.8 in August, although a positive reading still indicates an increase in regional manufacturing activity. Economists had expected the index to edge down to 4.0.

Later this week, the Federal Reserve is scheduled to announce its latest monetary policy decision, with the central bank widely expected to cut interest rates by another 25 basis points.

Trump has been pressuring the Fed for a larger rate cut, pointing to the stimulus announced by other central banks around the world.

"The United States, because of the Federal Reserve, is paying a MUCH higher Interest Rate than other competing countries," Trump tweeted.

He added, "They can't believe how lucky they are that Jay Powell & the Fed don't have a clue. And now, on top of it all, the Oil hit. Big Interest Rate Drop, Stimulus!"

Following the strong upward move seen on Wednesday and Thursday, stocks showed a lack of direction throughout the trading day on Friday. The major averages spent the session bouncing back and forth across the unchanged line before closing mixed.

The Dow held on to a modest gain, inching up 37.07 points or 0.1 percent to 27,219.52, its best closing level in over a month, but the Nasdaq dipped 17.75 points or 0.2 percent to 8,176.71 and the S&P 500 edged down 2.18 points or 0.1 percent to 3,007.39.

Despite the mixed performance on the day, the major averages all moved to the upside for the week. The Dow jumped by 1.6 percent, while the S&P 500 and the Nasdaq advanced by 1 percent and 0.9 percent, respectively.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Monday, with the Japanese markets closed for a holiday. Hone Kong's Hang Seng Index slid by 0.8 percent, while South Korea's Kospi climbed by 0.6 percent.

Meanwhile, the major European markets have all moved to the downside on the day. While the U.K.'s FTSE 100 Index has dipped by 0.2 percent, the German DAX Index and the French CAC 40 Index are both down by 0.6 percent.

In commodities trading, crude oil futures are soaring $5.54 to $60.39 a barrel after slipping $0.24 to $54.85 a barrel last Friday. Meanwhile, an ounce of gold is trading at $1,510.10, up $10.60 from the previous session's close of $1,499.50. On Friday, gold slid $7.90.

On the currency front, the U.S. dollar is trading at 107.85 yen compared to the 108.09 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is valued at $1.1029 compared to last Friday's $1.1073.

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