U.S. stock-index futures Tuesday evening rose modestly, hours after the benchmarks suffered a pullback that eroded part of a powerful rally. Futures for the Dow Jones Industrial Average YMM20, 1.20% were up 0.2%, at 23,805 those for the S&P 500 index ESM20, 1.15% were rising 0.2% at 2,864.50, while Nasdaq-100 futures NQM20, 1.04% gained 0.3% at 8,950.25. Stocks lost steam into the close of the regular session Tuesday, with the Dow DJIA, -1.58% gaining 133.33 points, or 0.6%, to end at 24,883.09, the S&P 500 index SPX, -1.04% advancing 25.70 points to finish at 2,868.44, a gain of 0.9%, while the Nasdaq Composite index COMP, -0.53% adding 98.41 points, or 1.1%, to close at 8,809.12.
The loss of momentum on Tuesday was attributed partly to comments from Federal Reserve Vice Chairman Richard Clarida, who said: “We’re living through the most severe contraction in activity and surge in unemployment that we’ve seen in our lifetimes,” in an interview on CNBC, referring to the coronavirus-induced slowdowns. “This is not a typical recession. It’s going to be a very, very sharp contraction” in the second quarter,” he explained. The remarks appeared sufficient to knock some of the stuffing out of an equity market that had been enjoying a sharp broad-based rally. However, the Fed’s No. 2 did note that the “recovery could begin in the second half” of 2020.
Meanwhile, President Donald Trump, speaking Tuesday evening at a Honeywell International Inc. HON, -3.00%, where N95 masks and other personal protective equipment was being manufactured in Arizona, acknowledged reports that his administration may be phasing out the coronavirus task force.
During an interview with Bloomberg on Tuesday, Vice President Mike Pence said “as states are reopening, we’re seeing the progress that we’re making. Markets had been rising on easing of lockdown protocols in a number of U.S. states. However, worries about China-U.S. tensions centered on Beijing’s handling of the viral outbreak that was first identified in Wuhan in December, and lingering concerns about how adeptly companies will be able to adapt to the new era of COVID-19, combined to inject some uncertainty in equity markets.
In corporate news, shares of entertainment giant Walt Disney & Co. DIS, -2.12% were down 2.3% in after-hours trade following the company’s quarterly report showed that its profit dove more than 90% in the second quarter, with more than $1 billion in lost profit from its theme parks alone, which have been mostly shuttered due to the deadly infectious disease. Meanwhile, alternative-meat maker Beyond Meat Inc. BYND, +4.74% saw its shares surge more than 10% after the regular session Tuesday after it reported first-quarter net income of $1.8 million, or 3 cents a share, compared with a loss of $6.6 million, or 95 cents a share, in the year-ago period. Revenue grew 141% to $97.1 million from $40.2 million in the year-ago period.
Dow books meager gain as traders say Fed’s Clarida sucked the life out of the stock market’s Tuesday rally
HTZ-6.62% Stocks ended higher on Tuesday, but well off their best levels, as market participants said cautious comments about the health of the U.S. economy from Federal Reserve’s No. 2, Richard Clarida, deflated much stronger gains. Investors had been upbeat as the easing of social restrictions put in place to stem the spread of the COVID-19 pandemic was fueling optimism on Wall Street.
The S&P 500 SPX, -1.04% rose 0.9% to 2,868. The Dow Jones Industrial Average DJIA, -1.58% climbed 133 points, or 0.6%, to 23,883, all on a preliminary basis. The Nasdaq Composite COMP, -0.53% gained 1.1% to 8,809. Despite the pullback from the intraday high Tuesday stocks still have managed to shrug off the economic devastation across the U.S. as the reopening of some states and counties offers a glimpse of the recovery.
In company news, shares of Hertz HTZ, -6.62% tumbled more than 16% after the Wall Street Journal reported that the car rental company had hired an additional adviser to help with an imminent bankruptcy filing.