Wall Street set for subdued open as virus surge threatens recovery

Climbing virus infections could harm the US economic rebound. — Reuters pic
Climbing virus infections could harm the US economic rebound. — Reuters pic

NEW YORK, July 1 — Wall Street's main indexes were set to open near-flat today, as a record single-day spike in coronavirus cases in the country heightened fears of another lockdown and threatened to derail a nascent economic recovery.

After notching up its biggest three-month gains since 1998 in the previous session, the S&P 500 looked set to begin the third quarter on a glum note as Covid-19 cases rose by more than 47,000 on Tuesday, with California, Texas and Arizona emerging as new epicenters.

A warning from the government's top infectious disease expert that the number could soon double also took the shine off data showing that a slump in global manufacturing was easing as economies reopened.

"We had to dig a pretty good size hole in the market in the first quarter to have the kind of rebound that we just saw," said Art Hogan, chief market strategist at National Securities in New York.

"The biggest challenge markets will face in the new quarter is the accelerating virus infections that threaten to set back reopenings and, with them, any economic progress."

Data yesterday showed US private payrolls increased less than expected in June. Figures on US manufacturing activity for the month are due later in the day, followed by the Labor Department's nonfarm payrolls report tomorrow.

At 8:56 a.m. ET, Dow e-minis were up just 4 points, or 0.02 per cent, S&P 500 e-minis were up 2.25 points, or 0.07 per cent and Nasdaq 100 e-minis were down 5.25 points, or 0.05 per cent.

Battered cruise line operators Norwegian Cruise Line Holdings Inc, Royal Caribbean Cruises Ltd and Carnival Corp tumbled as much as 1 per cent in premarket trading.

Macy's Inc fell 2.8 per cent per cent after it reported a staggering US$3.58 billion (RM15.3 billion) quarterly loss, led by a US$3 billion impairment charge due to Covid-19 induced-store shutdowns.

In a bright spot, FedEx Corp jumped 11.7 per cent after posting better-than-expected quarterly profit and revenue, helped by a surge in pandemic-fueled home deliveries. — Reuters

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