Wednesday July 1st

1-07-2020

Dow futures drop more than 100 points after Wall Street’s best quarter in decades

U.S. stock index futures fell Wednesday as Wall Street kicked off a new quarter after a remarkable comeback. Futures on the Dow Jones Industrial Average traded 187 points lower, or 0.7%. S&P 500 futures slid 0.5% and Nasdaq-100 futures dipped 0.4%. Futures trimmed losses after ADP and Moody’s Analytics said private payrolls jumped by 2.37 million in June. Payrolls for May were also revised to a gain of more than 3 million from a loss of 2.76 million. The market just notched its best quarter in decades as it snapped back from the historic sell-off triggered by the coronavirus. The Dow gained 17.8% in the second quarter, posting its best quarter since 1987, while the S&P 500 finished the period with a near 20% gain, its best since 1998. The tech-heavy Nasdaq soared 30.6% for the quarter, the most since 1999. FedEx jumped nearly 11% after posting quarterly earnings and revenue that topped analysts’ forecast. The shipping company experienced a surge in deliveries amid the coronavirus lockdown. While the market bounced sharply from its March lows, the recent spikes in coronavirus cases in some states kept investors on edge. White House health advisor Dr. Anthony Fauci warned Tuesday that if the outbreak continues at its current pace, daily new cases could surpass 100,000 new infections per day. So far, more than 12 states have now paused or rolled back their reopenings as cases in the U.S. jumped 40% over the past week to an average of about 39,750 on Monday, according to a CNBC analysis of data compiled by Johns Hopkins University. “We continue to expect it to be an uneven process, albeit with a positive trajectory,” Keith Lerner, chief market strategist at SunTrust Advisory Services, said in a note. “The good news is through this digestion period, markets are working off some of the excesses that had built up, and elevated expectations are being reset.” Stocks in Asia Pacific were mixed on Wednesday as a private survey showed China’s factory activity for June was better than expected. Mainland Chinese stocks led gains among the region’s markets, with the Shanghai composite up 1.38% to about 3,025.98 while the Shenzhen component added 1.006% to around 12,112.96. Elsewhere, shares in South Korea shed earlier gains as the Kospi finished its trading day slightly lower at 2,106.70. The Nikkei 225 in Japan also closed 0.75% lower at 22,121.73 while the Topix index fell 1.29% to end its trading day at 1,538.61. Markets in Hong Kong were closed for trading on Wednesday for a holiday. Oil prices rose on Wednesday after an industry report showed crude inventories in the United States fell much more than expected, suggesting demand is improving even as the coronavirus outbreak spreads around the world. Brent crude rose $1.09, or 2.7%, to trade at $42.38 per barrel, after declining more than 1% on Tuesday. U.S. crude was up $1.13, or 2.88%, at $40.40 a barrel, having dropped by 1.1% in the previous session. Gold prices rose to their highest in nearly eight years on Wednesday as a spike in coronavirus cases sparked concerns over the economic recovery from the pandemic and boosted demand for safe-havens. Spot gold hit its highest since early October 2012 at $1,788.96 in early trade, and was at $1,787.31 per ounce, up 0.4%. U.S. gold futures were up 0.3% at $1,805.10 per ounce.