A screen displays trading information for ride-hailing giant Didi Global on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., December 3, 2021.
A screen displays trading information for ride-hailing giant Didi Global on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., December 3, 2021. Reuters / BRENDAN MCDERMID

Wall Street was set to open higher on Monday after a drop last week, with U.S.-listed shares of Chinese technology companies rallying on optimism around easing regulatory crackdowns and relaxing COVID-19 curbs in the world's second-largest economy.

Shares of Didi Global Inc surged 64.3% in premarket trading after a report that regulators were preparing as early as this week to allow the ride-hailing firm's mobile app back on domestic app stores.

Didi - which was hit by a cybersecurity investigation days after its initial public offering in June 2021 - won shareholder approval for a U.S. stock delisting last month.

Full Truck Alliance and Kanzhun Ltd, whose apps will also be restored, climbed 26.8% and 20.6%, respectively. Shares of JD.com Inc, Baidu and Alibaba Group, all targets of China's crackdown on its internet sector, advanced between 4% and 6.3%.

The upbeat mood was also underpinned by signs of Beijing and Shanghai returning to normal life after China's biggest COVID-19 outbreak in two years.

"China is huge and it makes a big difference what happens there, but it is a pretty preliminary period right now when they are just starting to open things back up. If that continues on its current pace, that will help everything," said Randy Frederick, managing director of trading and derivatives for Charles Schwab.

"I do not see a lot of positive catalysts at the moment. It is surprising to me, perhaps it is that markets had dropped enough on Friday that people are looking for bargains."

U.S. stock indexes lost more than 1% on Friday to book weekly losses as elevated crude prices and a solid jobs report quashed hopes of a pause in the Federal Reserve's aggressive policy-tightening plan to cool decades-high inflation.

All eyes will be on the U.S. consumer price index report later this week for more clues on the path of future interest rate hikes. Signs that inflation remains strong could spook markets already battered by worries that a hawkish Fed could tip the economy into a recession.

Money markets are fully pricing in 50 basis point increases by the U.S. central bank next week and in July.

"We are kind of at a turning point where we do not really know whether or not the market can handle the interest rate hikes. It is not necessarily the smartest thing to be buying in the market right now," Frederick said.

At 8:28 a.m. ET, Dow e-minis were up 263 points, or 0.8%, S&P 500 e-minis were up 45 points, or 1.1%, and Nasdaq 100 e-minis were up 192.5 points, or 1.53%.

Market heavyweights Apple Inc, Alphabet Inc, Microsoft Corp, Meta Platforms and Amazon.com rose between 1.3% and 1.6%, while Tesla Inc advanced 3% after a slump last week.

Goldman Sachs added 1.3% to lead gains among the big banks.

The blue-chip Dow has fallen 9.5% so far this year, the benchmark S&P 500 has lost 13.8%, and the tech-heavy Nasdaq has shed 23.2%, as investors scrambled to adjust to tightening financial conditions.