Stock Futures Point To Higher Open On Wall Street
The U.S. equity futures are indicating a sharply higher open on Wall Street. The move comes a day after the broad market S&P 500 posted its biggest one-day loss in a decade. The SPX and Dow Jones are both up about 3.5% in early trading while the NASDAQ leads with a rise of 3.6%. Markets are buoyed by Trump’s pledge to pass some form of economic relief package although there are no details forthcoming. Trump suggested a payroll tax cut that would impact both employer and employee income, a press conference is expected later today.
Today’s bounce is good news for the market. The S&P 500 was down as much as 19% from its high on Monday putting it close to bear-market territory. The caveat is that volatility remains high and coronavirus risk is still present so more selling may ensue. The major indices had been up as much as 5.0% in early premarket trading but gave up some of their gains as market participants digested the day’s news.
Coronavirus Risk Is Still High
The total number of cases of the Covid-19 virus has topped 115,000 and still growing. The number of deaths reported globally is ow over 4,000. In the U.S., there are 755 known cases with 26 dead. Cruise ships remain a major risk to travelers as another enters quarantine due to the virus. Iran is still a hotbed of infection, the number of cases grew by 18% overnight with a rising death toll. Iran is the hardest hit in the Middle East and faces a severe economic impact from travel and work restrictions. Italy is also proving highly vulnerable to the disease.
The airlines are rising in today’s action although the number of flight reductions continues to grow. Delta, United and American Air Lines are all up between 3% and 6% on hopes of a rebound later in the year. Delta announced this morning it would cut its international flights by 25%, domestic by 19%, while American and United make similar cuts. Delta’s CEO says he expects the crisis to worsen. The CEO of Southwest is taking a 10% pay cut to offset the decline in bookings but the move is mostly show.
Stocks News Impacting Markets
Shares of Dick’s Sporting Goods are up more than 11% after reporting earnings. The sporting goods company beat comps as foot traffic and ticket averages came in above consensus. The company also provided positive guidance for 2020. Shares of Stitch Fix are moving in the opposite direction after beating estimates. The company says promotional activity is hurting its revenue outlook and lowered full-year guidance.