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U.S. stock-index futures edged higher Tuesday as investors monitored efforts to reopen the economy and debated the likely shape of a recovery from the coronavirus-induced economic plunge.
What are major indexes doing?
Futures on the Dow Jones Industrial Average YM00, +0.52% rose 129 points, or 0.5%, to 24,253, while S&P 500 futures ES00, +0.42% gained 12.2 points, or 0.4%, to 2,935.75. Nasdaq-100 futures NQ00, +0.43% were up 40.75 points, or 0.4%, at 9,319.
The Dow Jones Industrial Average DJIA, -0.44% on Monday ended down 109.33 points or 0.5%, at 24221.99, while the S&P 500 SPX, +0.01% eked out a gain of 0.39 point to 2,930.19. The Nasdaq Composite COMP, +0.77% extended its winning streak to six sessions, rising 71.02 points or 0.8%, to end at 9,192.34 — its highest finish since Feb. 24.
What’s driving the market?
Countries that have begun to lift restrictions on movement imposed to contain the spread of the COVID-19 have seen some new clusters of the disease which analysts said might be giving investors pause as U.S. states begin, or outline plans to begin, loosening restrictions in a bid to reopen the economy.
In Wuhan, the Chinese city where the coronavirus first emerged late last year, six people tested positive over the weekend, ending a stretch of more than a month that had seen Hubei province report zero infections, The Wall Street Journal reported. Germany and South Korea have also seen a flare-up in cases after moving to loosen restrictions.
”Reopening segments of the economy was always going to be a risk, but nations quickly adapted to the pandemic, so no doubt a reaction will be put forward should the health situation deteriorate at a fast rate,” said David Madden, market analyst at CMC, in a note.
Fears of a rise in infections offered investors an excuse to take some money off the table in the wake of a strong market run-up in recent weeks, he said.
Dr. Anthony Fauci, in testimony before a Senate committee on Tuesday, will warn that the U.S. risks “needless suffering and death” if the economy reopens too soon, the New York Times reported Monday night. Fauci, the director of the National Institute of Allergy and Infectious Diseases, is the government’s leading expert on infectious disease and the public face of government efforts to contain the pandemic.
Investors are favoring technology firms whose businesses have thrived during the coronavirus pandemic. Shares of Amazon and Netflix both gained more 30% this year, while Microsoft is up 18%. Chipmaker Nvidia also hit an all-time high on Monday and is up 37% this year.
Read:3 questions for Anthony Fauci as he testifies on Capitol Hill
A major U.S. airline will “most likely” go bankrupt, Boeing Co. BA, -3.39% Chief Executive David Calhoun said during an interview aired on NBC’s “Today” show Tuesday. Calhoun didn’t identify any carrier, and Bloomberg News quoted a Boeing spokesman as saying the CEO wasn’t referring to any airline in particular. Calhoun said airlines won’t be back to even 25% business by the autumn, and “maybe by the end of the year we approach 50 [percent].”
The National Federation of Independent Business on Tuesday said its gauge of small-business optimism fell 5.5 points to 90.9 in April. Economists had expected a reading of 84.8, according to Econoday.
The U.S. economic calendar features April data on the consumer-price index at 8:30 a.m. Eastern, which is expected to fall 0.8%, according to a MarketWatch survey of economists. The core reading, excluding the volatile food and energy sectors, is forecast to decline 0.2%. April federal government budget figures are due at 2 p.m. Eastern.
Minneapolis Federal Reserve Bank President Neel Kashkari is slated to speak at 9 a.m. Eastern, while Philadelphia Fed President Patrick Harker is scheduled to deliver remarks at 10 a.m. Eastern. Fed Vice Chairman Randal Quarles is set to testify before the Senate Banking Committee at 10 a.m. Eastern, while Cleveland Fed President Loretta Mester is scheduled to speak at an event in Chicago at 5 p.m. Eastern.
Which companies are in focus?
- Tesla Inc. TSLA, -0.99% shares were up 0.9% in premarket trade. Chief Executive Elon Musk on Monday escalated a showdown with local health authorities and reopened the company’s Fremont, Calif., car-making plant beyond minimal operations.
- Shares of Tilray Inc. TLRY, +3.85% fell 5.9% in premarket trade, after the British Columbia-based cannabis company reported a wider-than-expected net loss late Monday, but said the COVID-19 pandemic has not materially hurt its ability to sell pot to medical patients and recreational customers.
- Shares of Apple Inc. AAPL, +1.57% rose 0.8% in premarket action after Wedbush analyst Dan Ives raised his price target from $335 to $350, putting the company’s stock on track for a seventh consecutive gain.
- Hertz Global Holdings Inc. HTZ, -2.44% announced first-quarter earnings late Monday that showed deepening losses. Shares were 4.1% lower before the start of trade Tuesday.
How are other markets trading?
Crude oil prices edged up after settling lower Monday, with West Texas Intermediate Crude for June delivery CLM20, +5.75% up $1.30, or 5.4%, to $25.46 a barrel. In precious metals, the price of an ounce of June gold GCM20, +0.58% gained $10, or 0.6% to about $1,708.
The yield on the 10-year U.S. Treasury note TMUBMUSD10Y, 0.713% was down about 2 basis points to 0.703%.
The U.S. dollar lost ground against a basket of six rivals, with the ICE U.S. dollar index DXY, -0.37% down 0.3%.
In Europe, stocks were trading mostly higher, with the Stoxx Europe 600 SXXP, +0.53% up 0.5% and the U.K.’s FTSE 100 UKX, +0.94% up 0.9%.
In Asia overnight, stocks closed mostly lower, with China’s CSI 300 000300, +0.00% virtually unchanged, Hong Kong’s Hang Seng index HSI, -1.44% down 1.5% and Japan’s Nikkei NIK, -0.11% losing 0.1% lower.
