Stock-index futures pointed to losses for Wall Street Tuesday amid worsening data on coronavirus deaths in the U.S. and Spain, after equities initially found support following data showing a rebound in Chinese manufacturing activity in March, as the country comes out of a lockdown.
What are the major indexes doing?
Futures on the Dow Jones Industrial Average
were off 297 points, or 1.3%, at 21,895 while S&P 500 futures
fell 31.70 points, or 1.2% to 2,579.75. Nasdaq-100 futures
retreated 71.75 points, or 0.9% to trade at 7,785.25.
Stocks were in rebound mode Monday, with the Dow
rising 690.70 points, or 3.2%, to finish at 22,327.48. The S&P 500
climbed 85.18 points, or 3.4%, to 2,626.65. The Nasdaq Composite Index
rose 271.77 points, or 3.6%, to 7,774.15.
What’s driving the market?
Concerns remain over the spread of COVID-19 in the U.S., Europe in particular, with economic activity under lockdown amid a rising tally of infections and a mounting death toll.
Global equities enjoyed a lift after data on China’s manufacturing and service sectors showed unexpectedly strong rebounds in March as the country emerged from the lockdown aimed at arresting the spread of COVID-19.
The official manufacturing purchasing managers index for manufacturing rose to 52.0 in March from a record low of 35.7 in February, the National Bureau of Statistics said Tuesday, topping expectations for a reading of 51.5. The 50 mark separates expansion of activity from contraction.
China’s official service sector purchasing managers index climbed to 52.3 in March from a record-low reading of 29.6 in February.
The PMI readings were “well above expectations and almost too good to be a true for an economy that is still not fully functioning at its pre-crisis optimum level,” said Michael Hewson, chief market analyst at CMC Markets, in a note.
Analysts said the stock market’s strong rebound last week and further rally on Monday were encouraging, but the continued volatility made for a treacherous near-term trading backdrop. The debate over whether stocks put in a bear-market bottom on March 23 continues, with analysts noting that past downturns have also seen strong bounces from selloffs, followed by retests of the lows.
“Last week’s double-digit gain for markets was a welcome relief rally, though market bottoms are rarely as clean as this one has been. In 2000/01, there were four rallies of greater than 20% before ultimately reaching a bottom, and in the financial crisis, the S&P 500 had a false breakout of 27% before hitting a bottom,” noted Mark Hackett, chief of investment research at Nationwide, in a note.
Which companies are in focus?
• Cruise-line operator Carnival Corp.
said it would suspend its dividend and the repurchase of its common stock, in an effort to improve liquidity as the spread of COVID-19 has led to the pause of its fleet cruise operations. Shares fell 3.4% after a 28% drop over the past two sessions and nearly 75% over the past three months.
• Several energy stocks were posting significant gains, after suffering significant declines as oil prices touched their lowest levels since 2002, before rebounding early Tuesday. Exxon Mobil Corp.
gained 3.1% before the start of trade, while Occidental Petroleum Corp.
gained 5.1% and Haliburton Co.
• McCormick & Co. Inc. reported fiscal first-quarter earnings that beat expectations, but sales that fell short Tuesday morning. Shares of the spice and condiments manufacturer fell 2.2% before the start of trade.
• Shares of Domino’s Pizza Inc. traded lower in premarket trade Tuesday after the pizza-delivery company said Monday evening that global sales were on pace to rise 4.4% in the first quarter as stay-at-home orders boost demand for food delivery. The company’s stock has risen 2.4% in March, versus a 11.1% decline for the S&P 500.
How are other markets trading?
Oil prices rebounded from 19-year lows, with the price of a barrel of West Texas Intermediate crude oil
for May delivery up 6.1%, or $1.22 to about $21.27. In precious metals,
fell $25, or 1.5% to $1,597 an ounce.
The U.S. dollar
gained 0.7% against a basket of its major trading partners, according to the ICE U.S. Dollar index.
European stocks were trading higher, with the Stoxx Europe 600