Wall Street stock market was set to start the week on a dour note on Monday. Surging COVID-19 cases and a stalemate in Washington over the next fiscal aid bill cast down the economic outlook. This is in the run up to Nov. 3 presidential elections.
New coronavirus infections touched record levels in the United States recently. El Paso in Texas asked citizens to stay at home for the next two weeks. Europe, Italy and Spain imposed new restrictions.
American Airlines stock, United Airlines Holdings and Booking Holdings Inc., were down between 2% and 2.8% before the bell. These are travel-related stocks that are vulnerable to COVID-19 news.
Wall Street’s main indexes ended lower last week. Investors closely monitored discussions over the next round of the fiscal package. Economic data pointed to a stalling recovery.
U.S. House Speaker Nancy Pelosi on Sunday, said the Trump administration was reviewing the latest proposal for the pandemic relief. This was over the weekend and that she expected a response on Monday.
More than 59.1 million Americans already have voted in person or by mail. Incumbent President Trump and his Democratic challenger Biden enter their final full week of campaigning.
It’s one of the busiest weeks of the Q3 earnings season that will see results from mega-cap U.S. tech firms. These include Apple Inc, Amazon.com Inc, Google-parent Alphabet Inc and Facebook Inc.
So far, of the 135 firms in the S&P 500 that reported their earnings, 83.7% of them beat Wall Street expectations.
At 08:32 a.m. ET, Dow E-minis <1YMcv1> fell 1.01% at 27,900 points. The S&P 500 E-minis dropped 0.96% to 3,418.5 points. Nasdaq 100 E-minis slid 0.88% to 11,561 points.
Software company Oracle Corporation stock was down 2.8%. Its German rival SAP abandoned medium-term profitability targets. Moreover, it warned that its business would take longer than expected to recover from the pandemic hit.
Hasbro Inc declined about 3% despite beating analysts’ estimates for quarterly revenue and profit.
A Third Wave of the Pandemic
The United States is clearly experiencing a third wave of the pandemic. It is just a week to go before the Nov.3 presidential election. Hospitalization rates have increased by around half over the last month to their highest since August.
For nearly two weeks, the seven-day moving average for deaths has been trending up. Furthermore, the initial jobless claims still run at nearly 800,000 a week.