U.S. stock-index futures on Monday pointed to a slightly higher open even as data over the weekend highlighted the persistence of coronavirus in hot spots, including Florida, Texas and California, fueling concerns about the economic outlook.
Financial markets in the U.S. will be closed on Friday in observance of the Fourth of July holiday.
How are benchmarks performing?
Futures for the Dow Jones Industrial Average YM00, +0.85% YMU20, +0.85% gained 95 points, or 0.4%, at 25,045; those for the S&P 500 ES00, +0.53% ESU20, +0.53% picked up 4.85 points, or 0.2%, at 3,011.75; while Nasdaq-100 futures NQ00, +0.07% NQU20, +0.07% retreated 26.50 points, or 0.3%, to reach 9,839.
What’s driving the market?
Appetite for risk is limited to start the week as coronavirus cases world-wide surpassed 10 million, with more a half-million deaths, with a dozen states, including Florida, Texas, California and Arizona, hot spots in the U.S., reversing reopening plans and implemented tighter restrictions to prevent a further spread of the viral epidemic, the Wall Street Journal reported.
Health and Human Services (HHS) Secretary Alex Azar said that the “window is closing” to managing the resurgence of the epidemic in the U.S., on Sunday during NBC’s “Meet the Press.”
“We’ve got the tools to do this,” Azar said. “But the window is closing, we have to act, and people as individuals have to act responsibility.”
An inability to curtail the spread of COVID-19 will prove problematic for economic projections that factor in a sharp, V-shaped rebound of business activities, which been stalled or closed to address the public-health crisis.
The U.S. recorded more than 42,000 cases Saturday, according to data compiled by Johns Hopkins University, marking a second straight daily total over 40,000, even if it represented a decline of Friday’s record 45,255 tally. Florida, Nevada, George and South Carolina reported a surge in new cases on Saturday, Politico reported.
Meanwhile, in China, industrial profits in May were up 6% from a year earlier, representing the first increase in 2020, official statistics released over the weekend showed.
Investors are expecting some turmoil due the holiday-shortened week and end-of-quarter activity from investment managers, including pensions and mutual funds.
“In summary, with two days left before the quarter dies, window dressing is likely to increase volatility with some sectors gaining over others,” wrote Peter Cardillo, chief market economist at Spartan Capital Securities.
“However, the trend is likely to remain negative ahead of this weeks key macro indicators and the upcoming earnings season,” he said, referring to corporate quarterly results that kick of in earnest in the middle of July.
Looking ahead, investors are watching for a report on pending home sales at 10 a.m. Eastern Time and a manufacturing survey of the Dallas area from the Federal Reserve at 10:30 a.m.
New York Fed President John Williams is set to speak at 3 p.m.
Which stocks are in focus?
- Facebook FB, -8.31% Starbucks Corp. SBUX, -3.08% Unilever UN, -0.58% ULVR, -1.81% will be in focus after announce Sunday that it is “pausing” advertisements on all social-media platforms, two days after consumer-products conglomerate said it was halting U.S. advertising on Facebook and Twitter TWTR, -7.39% through year-end over ineffective policing of hate speech, leading to a sharp Friday selloff in both stocks.
- U.S. air-safety regulators are set to begin key flight tests of Boeing Co.‘s BA, -2.78% 737 Max as early as Monday, with the aim of returning the planes to service around the end of the year.
- Chesapeake Energy Corp. CHK, -7.27% said Sunday that it had filed for bankruptcy protection as an oil- and gas-price rout stoked by the coronavirus pandemic proved to be the final blow for a shale-drilling pioneer long hamstrung by debt.
- Shares of Coty Inc. COTY, -4.12% soared in premarket trading Monday, after the cosmetics, fragrance and skin care company announced a deal with Kim Kardashian West to develop Kardashian West’s beauty business globally.
- Aurora Cannabis Inc. ACB, -5.53% said Monday that co-Founder and former Chief Executive Terry Booth is retiring from its board.