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Stock-index futures rose modestly Wednesday, attempting to resume a rally as investors weighed progress toward a COVID-19 vaccine against a continued rise in cases of the viral illness.
What are major benchmarks doing?
Futures on the Dow Jones Industrial Average YM00, +0.50% rose 151 points, or 0.5%, to 29,871, while S&P 500 futures ES00, +0.33% were up 12 points, or 0.3%, at 3,619. Nasdaq-100 futures NQ00, +0.17% advanced 21 points, or 0.2%, to 11,996.
The Dow DJIA, -0.55% on Tuesday fell 167.09 points, or 0.6%, to close at 29,783.75, while the S&P 500 SPX, -0.47% declined 17.38 points, or 0.5%, to finish at 3,609.53 — a day after both gauges posted record finishes. The Nasdaq Composite COMP, -0.20% ended 24.79 points lower at 11,899.34, down 0.2%.
The small-cap Russell 2000 RUT, +0.36% continued to outperform, rising 6.57 points, or 0.4%, to a record 1,791.91.
What’s driving the market?
“The tug of war between virus pessimism and vaccine optimism continues,” said Marshall Gittler, head of investment research at BDSwiss Group.
Investors got another round of positive news on the vaccine front Wednesday. Pfizer Inc. PFE, +1.84% said the vaccine candidate it has developed with BioNTech SE BNTX, -5.01% was 95% effective in a final analysis of clinical trial data. Pfizer plans to seek authorization for the vaccine within days, the companies said.
Pfizer shares rose 4% in premarket trade, while BioNTech was up more than 8%.
The U.S. recorded 159,431 new cases on Tuesday, and at least 1,583 people died, according to a New York Times tracker. In the last week, the U.S. averaged 158,254 cases a day, up 79% from the average two weeks ago, with cases rising in 50 states and territories, straining hospitals and health care resources.
Until Tuesday, optimism over a vaccine had tended to overshadow worries over the continued rise in cases. Two vaccine candidates have so far proved more than 90% effective in preventing COVID-19 infections in late-stage trials.
The balancing act “was well-illustrated by the performance in the S&P 500 yesterday, where the market opened lower, then regained almost fully the opening losses but then slipped again towards the end of the trading session,” said Elwin de Groot, head of macro strategy at Rabobank, in a note.
“Yes, with the S&P only a whisker from its all-time high it is obviously ‘risk-on’, but somehow if feels different,” he said.
Meanwhile, there is no sign of movement toward additional aid from Washington. Federal Reserve Chairman Jerome Powell on Tuesday made a fresh appeal to Congress to pass another coronavirus relief package to help troubled businesses and out-of-work Americans.
Powell aid he expected the economic recovery to continue “at a solid pace” but faced significant downside risks despite progress toward a vaccine and treatments.
The economic calendar features data on October housing starts and building permits at 8:30 a.m. Eastern.
Investors will also hear from several Federal Reserve officials over the course of the day, including New York Fed President John Williams, St. Louis Fed President James Bullard, Dallas Fed President Robert Kaplan and Atlanta Fed President Raphael Bostic.
Which companies are in focus?
- Boeing Co. BA, +3.78% shares rose more than 5%, leading Dow gainers in premarket trade, on expectations the Federal Aviation Administration would approve the return to service of the aerospace giant’s 737 MAX jets, which have been grounded since March 2019
- Shares of Target Corp. TGT, -0.88% rose 2.5% premarket after the retail chain announced earnings and revenue that topped forecasts.
- Shares of Lowe’s Cos. LOW, -1.26% were down more than 6% after the home improvement retailer reported fiscal third-quarter sales that rose above expectations, but delivered an adjusted profit that was just in line with forecasts.
How are other assets trading?
The yield on the 10-year Treasury note TMUBMUSD10Y, 0.864% rose 1 basis point to 0.87%. Yields and prices move in opposite directions.
The ICE U.S. Dollar Index, DXY, -0.08% a gauge of the greenback’s strength against its major rivals, was down 0.1%.
The pan-European Stoxx 600 index SXXP, +0.47% climbed 0.4%, while the U.K.’s FTSE 100 index UKX, +0.35% gained 0.3%.
Crude-oil futures rose, with the U.S. benchmark CLZ20, +2.29% up 2.1% or 86 cents to $42.29 a barrel. Meanwhile, gold futures GCZ20, -0.83% fell $14.80 to $1870.30 an ounce.
