Stock futures turned negative after White House trade advisor Peter Navarro told Fox News in a Monday interview that the trade deal with China was “over.”
As of Monday evening stateside, Dow futures dropped 398 points, implying an opening drop of more than 300 points at the open on Tuesday. Futures on the S&P 500 and Nasdaq-100 also pointed to a lower open for the two indexes.
On Monday, the Dow Jones Industrial Average rose 153 points, or 0.6%. The S&P 500 also registered a gain, climbing 0.7%.
The Nasdaq Composite was the outperformer, rising more than 1%, thank to helps from mega-cap technology companies. The close marks a record close of the technology heavy index, its 20th of the year. Shares of Apple ticked up 2.6% and shares of Microsoft rose nearly 3%.
While stocks started the week on a strong foot, it came under thin trading. The SPDR S&P 500 ETF Trust (SPY), which tracks the broader market index, traded more than 67 million shares on Monday. That’s well below the ETF’s 30-day volume average of 105.01 million.
“The message today may be that the virus and the bull market can coexist,” Jim Paulsen, chief investment strategist at the Leuthold Group, told CNBC. “Despite back to back days of Covid19 cases above 30,000 over the weekend and ongoing reports of hot spots, the stock market managed to post a strong gain. Market action seems to suggests that investors expect the economy to continue improving in the months ahead even though the country is likely to experience spotty or temporary spikes in the virus.”
The major U.S. stock averages are coming off their fourth weekly gain in five weeks.
The number of newly confirmed coronavirus cases at home and abroad continues to increase, raising questions about economic recovery from the virus. The largest single-day increase in global coronavirus cases was recorded on Sunday, according to the World Health Organization, after more than 183,000 new cases were reported worldwide.
The U.S. saw more than 36,000 new cases reported on Sunday after more than 30,000 new cases were reported on both Friday and Saturday, data compiled by Johns Hopkins University showed. Widespread testing is contributing to the uptick in reported cases.
Texas Gov. Greg Abbott said at a news conference Monday that the coronavirus is spreading at an “unacceptable rate” in the state, according to NBC 5 in Dallas-Fort Worth.
White House economic advisor Larry Kudlow told CNBC on Monday “there is no second wave coming and that lawmakers will likely develop another stimulus package by the end of next month.
New home sales data from May will be released on Tuesday morning.
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Published at Tue, 23 Jun 2020 01:42:18 +0000-Dow futures down nearly 400 points after Peter Navarro says China trade deal is ‘over’