Dow futures drop greater than 100 factors as Wall Road grapples with rising Covid-19 instances and income
U.S. stock futures fell Tuesday night after a mixed session in which traders weighed a recent surge in coronavirus infections.
Dow Jones Industrial Average futures were trading 118 points lower, or 0.4%. The S&P 500 was down 0.5% and the Nasdaq 100 futures were down 0.4%.
The Dow fell more than 200 points during regular trading and the S&P 500 fell 0.3%. Meanwhile, the Nasdaq Composite gained 0.6%. Tuesday’s mixed market action came as names that would benefit from people staying at home, like Amazon and Zoom Video, rose sharply, while stocks dependent on the reopening of the economy fell.
Daily U.S. coronavirus cases have risen by a record 69,967 average over the past week, data from Johns Hopkins University showed. According to the Covid Tracking Project, hospital stays related to coronavirus have increased 5% or more in 36 states.
This increase has led some countries to reintroduce certain lockdown measures. In the US, the state of Illinois has ordered Chicago to stop eating indoors.
“The uncertainty over COVID-19-related mobility restrictions and US policies means we should expect volatility to remain elevated for the remainder of the year,” said Mark Haefele, chief investment officer for global wealth management at UBS, in a note . “However, we continue to see an upward trend in the medium term.”
“With ten vaccine candidates in late-stage trials around the world, our key scenario is that restrictions can be lifted from Q2 21, which will help corporate profits recover to pre-pandemic highs towards the end of 2021,” he said.
Wall Street also looked through the previous quarter’s latest corporate earnings, including those of tech giant Microsoft.
Microsoft reported better-than-expected earnings and revenues for the previous quarter as sales from the cloud business increased sharply. In after-hours trading, however, the stock fell 0.3%.
“Redmond continues to see strength in this area as more companies move to the cloud,” Wedbush analyst Dan Ives said in a note. “This is in stark contrast to the win debacle we saw from mature software SAP earlier this week that highlights the clear winners and losers of this cloud transformation, with MSFT leading the way.”
First Solar also released quarterly numbers that exceeded analysts’ expectations, rising about 10% after the bell. Boeing, General Electric, UPS, and Fiat Chrysler are among the companies that will be reporting on Wednesday before the bell.
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