Finance News

Inventory futures modified little as US coronavirus instances soared to document ranges

Traders wearing masks work on the first day of personal trading since they closed during the Coronavirus Disease (COVID-19) outbreak on the floor of the New York Stock Exchange (NYSE) in New York, the United States, on May 26, 2020.

Brendan McDermid | Reuters

US stock futures moved from an earlier decline around the flatline as US coronavirus cases continued to grow, raising concerns about economic reopening and recovery.

As of early Monday trading on Monday, Dow Jones Industrial Average futures were trading 27 points lower. The S&P 500 futures and Nasdaq 100 futures have hardly changed. At the start of the session, Dow futures were trading over 100 points less.

Data compiled by Johns Hopkins University showed that more than 2.5 million cases have been confirmed in the United States. On Friday alone, 45,255 additional cases were reported, increasing the country's seven-day average to over 41% compared to the previous week.

On Saturday, Florida reported a one-day record of 9,636 cases. The state reported another 8,577 on Sunday. These numbers were released after Florida again banned drinking in bars on Friday. Texas, another state in which coronavirus infections have posted record increases, has canceled some of its reopening efforts on Friday. Arizona Governor Dough Ducey said Friday's cases in the state "are growing rapidly in all ages and populations."

Health Minister Alex Azar warned on Sunday that the "window for the United States is closing" to curb the coronavirus outbreak.

"Reopening plans stumbled – not only in new virus hotspots like TX and FL, but also impacted international travel – as daily US virus cases surpassed what was hoped for in April," wrote Julian Emanuel, chief strategist for stocks and derivatives at BTIG.

He also noted that the S&P 500 closed below its 200-day moving average – a level that was closely watched by traders – when Wall Street "paused to assess not only the short-term effects of these risks" .

The main averages saw their second weekly decline in three weeks. The Dow fell 3.3% last week, while the S&P 500 lost 2.9%. The Nasdaq Composite fell 1.9% last week. On Friday, the Dow fell more than 700 points, while the S&P 500 and Nasdaq each fell more than 2.4%.

"The bearish argument for the current market is that the breadth has not increased at this stage of consolidation," said Andrew Thrasher, founder of Thrasher Analytics, in a note. "This is discouraging as more stocks collapsed along with the index."

Thrasher noted that 3,150 will be an important level for investors. "I'm less interested in risky assets until we get back to that level," he said.

Subscribe to CNBC PRO for exclusive insights and analysis, as well as live business day programs from around the world.

Related Articles