U.S. Stocks Set To Open Lower Amid Fears About Second Wave In EuropeS&P 500 futures are losing ground in premarket trading as European countries move closer to new lockdowns.
Coronavirus Is Back Into Spotlight
European stocks are pushing the world markets lower amid fears about the second wave of the virus. S&P 500 futures have joined the trend and are down by more than 1% in premarket trading.
Yesterday, President of France Emmanuel Macron imposed a curfew on the country’s biggest cities in order to deal with the second wave of coronavirus. Other European countries are also moving closer to serious restrictions.
London’s mayor Sadiq Khan has recently stated that Britain’s capital will soon be moved into the second tier of restrictions which will impose additional limits on public life in the city.
The U.S. dollar is showing strength as investors increase their purchases of safe haven assets. Not surprisingly, stronger dollar puts significant pressure on gold and silver. Oil, which has recently tried to get above the resistance at $41.50, returned back below the $40 level.
In this light, commodity-related stocks may take a double hit today from stronger dollar and general anxiety about future demand for commodities amid the second wave.
Hopes For A New Round Of Stimulus Fade
U.S. Treasury Secretary Steven Mnuchin stated that the new coronavirus aid package was unlikely before the election in November. U.S. stocks have recently had a great run as traders hoped for a new stimulus bill so this statement put additional pressure on equities.
While the market believes that a stimulus package is inevitable, traders would prefer to see a new round of stimulus as soon as possible.
Without additional help from the U.S. government, traders will focus on companies’ reports during the third-quarter earnings season and the new developments on the coronavirus front.
U.S. Initial Jobless Claims Increased To 898,000
Initial Jobless Claims report indicated that 898,000 Americans filed for unemployment benefits in one week. Analysts expected Initial Jobless Claims of 825,000.
Meanwhile, Continuing Jobless Claims declined from 10.98 million to 10.02 million compared to analyst consensus of 10.7 million.
Most likely, traders will focus on the disappointing Initial Jobless Claims report which showed that more people were losing their jobs amid the pandemic.
For a look at all of today’s economic events, check out our economic calendar.