# Dow poised to pull back from records as Birx says COVID will be ‘worst event this country will face’
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Dow poised to pull back from records as Birx says COVID will be ‘worst event this country will face’
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U.S. stock indexes on Monday were set to retreat from a round of records put in on Friday, as worries about COVID-19’s spread escalated and unease about global political developments appeared to momentarily undermine risk appetite on Wall Street.
How are stock benchmarks performing?
-
Futures for the Dow Jones Industrial Average
YMZ20,
-0.39% YM00,
-0.39%
were off 105 points, or 0.4%, at 30,093. -
S&P 500 index futures
ESZ20,
-0.38% ES00,
-0.38%
were trading 12.65 points, or 0.4%, lower at 3,685.25. -
Nasdaq-100 futures
NQZ20,
-0.04%
NQ00,
-0.04%
shed 5 points, or less than 0.1%, to trade at 12,521.
On Friday, the stock market closed out the week higher and all three major benchmarks finished at all-time highs, as wells the Russell 2000 index
RUT,
:
-
The Dow
DJIA,
+0.83%
rose 1% for the week. -
The S&P 500 index
SPX,
+0.88%
put in a 1.7% weekly advance. -
Nasdaq Composite Index
COMP,
+0.70%
gained 2.1%
What’s driving the market?
Investors were finding few reasons to drive the market to further records on Monday as they pondered the prospect of fresh round of relief from Washington lawmakers: considered the biggest potential catalyst for markets in this stage of the rebound in the COVID-19 pandemic.
“While a game changer in the long term, the vaccine deployment won’t be enough to address the stalling recovery over the next few months.” wrote Hussein Sayed, chief market strategist at FXTM, in a Monday note. “Hence, markets are counting on U.S. policy makers to act,” said the analyst.
Top congressional Democrats have endorsed a $908 billion bipartisan package that calls for $300 a week in enhanced unemployment benefits, $288 billion in assistance for U.S. businesses and $160 billion for state and local. Pelosi said Friday that talks on a COVID-19 relief package have “momentum.”
Sen. Bill Cassidy, R-La., on Sunday said he was optimistic President Donald Trump and Senate Majority Leader Mitch McConnell, R-Ky., will back the proposal, the Associated Press reported.
The closely followed report on the state of U.S. employment in November showed that 245,000 jobs were added to the U.S. economy, far less than the 432,000 estimated, marking the monthly recovery from the global epidemic since May and suggesting that it may take several years to recover the millions of jobs lost.
Meanwhile, investors were also paying attention to discussions between the European Union and U.K. officials that appear perilously close to leading to no trade agreement.
Over the weekend, U.K. Prime Minister Boris Johnson held talks with European Commission President Ursula von der Leyen, as negotiators try to reach a so-called Brexit deal, according to reports. The British pound was under pressure on Monday as investors fear that a no-trade deal will come to fruition, potentially adding to market turmoil amid the pandemic.
Elsewhere in the world, Reuters reported the Trump administration was preparing economic sanctions on a dozen more Chinese officials, in response to Beijing’s crackdown on dissent in Hong Kong.
On top of that, index compiler FTSE Russell said it would drop eight Chinese stocks from major indexes that it says supports China’s military.
In November, President Trump also signed an executive order barring Americans from investing in Chinese companies that are believed to support China’s military, intelligence and security services.
On the public-health front, Dr. Deborah Birx, the White House’s coronavirus response coordinator, warned on Sunday that the coronavirus surge “is the worst event that this country will face,” as hospital systems are overrun.
Thus far, the global tally for confirmed cases of the coronavirus that causes COVID-19 rose above 67 million on Monday, according to data aggregated by Johns Hopkins University, while the death toll rose above 1.5 million. The U.S. has the highest case tally in the world at 14.8 million and the highest death toll at 282,324, or more than a fifth of the global total.
Which stocks are in focus?
-
Shares of Eastman Kodak Co.
KODK,
+4.15%
soared premarket Monday, after federal regulators found no wrongdoing in the process which created a loan to the company which has been halted, according to a report in The Wall Street Journal. -
Cisco Systems
CSCO,
+0.61%
said it’s buying IMImobile
IMO,
+47.33%
for $720 million. -
Seacor Holdings Inc.
CKH,
+5.07%
said Monday it has agreed to be taken private by a unit of American Industrial Partners, a New York-based private-equity firm, in an all-cash deal with a value of about $1 billion, including debt. -
Chinese electric-vehicle maker XPeng Inc.
XPEV,
-4.79%
said it filed for the sale of some 40 million shares.
How are other assets faring?
The pan-European Stoxx 600 index
SXXP,
fell 0.4%, while the U.K.’s FTSE 100 index
UKX,
rose 0.4%.
In Asian markets, China’s Shanghai Composite Index
SHCOMP,
finished 0.8% lower, while Hong Kong’s Hang Seng
HSI,
booked a 1.2% drop. Japan’s Nikkei 225
NIK,
ended 0.8% lower.
The yield on the 10-year Treasury note
TMUBMUSD10Y,
fell 2.5 basis points to 0.944%. Yields and prices move in opposite directions.
The ICE U.S. Dollar Index
DXY,
a gauge of the greenback’s strength against its major rivals, was 0.3% higher.
Crude-oil futures
CL.1,
fell 1.1% to $45.75 a barrel on the New York Mercantile Exchange. Gold futures
GCG21,
ticked down 0.2% to $1,836.20 an ounce.
By
Mark DeCambre and
Sunny Oh
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