The US stock exchange traded overnight on Tuesday amid renewed investors’ concerns about the global recovery from the coronavirus pandemic.
Dow futures rose 20 points. S&P 500 futures rose 0.08% and Nasdaq 100 futures rose 0.3%.
On Tuesday, equities linked to an economic recovery led to losses amid rising new cases of coronavirus in the US and abroad.
The Dow Jones industrial average lost more than 300 points, with a 3.4% drop in Caterpillar’s share. The S&P 500 fell 0.76% with huge losses of airlines and crossovers. The Nasdaq Composite fell 1.12% as Facebook, Apple and Tesla all closed lower.
The benchmark for small business Russell 2000 fell by 3.58%, for its worst day since June.
Many world species are witnessing increasing cases of Covid-19 as many contagious variants continue to spread, the World Health Organization said. Germany and France are expanding or applying new closure measures.
Concerns about the recovery come on the one-year anniversary of the market bottom. Stocks bounced off the market bottom with the S&P 500 surge of about 80% since the low a year ago, which was the best start for a new bull market on record.
On Wednesday, Federal Reserve Chairman Jerome Powell and Treasury Secretary Janet Yellen will continue their testimony to the U.S. House Committee on Financial Services. In the first joint appearance Tuesday, the pair acknowledge the valuable asset prices in the market, but say they are not worried about financial stability.
“I would say that although the valuation of assets is increased by historical measures, there is also the belief that if the vaccinations go fast, that the economy can get back on track,” Yellen said during the testimony. “I think the most important thing is that in an environment where asset prices are high, regulators need to ensure that the financial sector is resilient and that the markets work well.”
Powell said the economic recovery from the pandemic “has progressed faster than generally expected and appears to be intensifying.”
However, he said that the sectors of the economy hardest hit by the pandemic ‘remained weak’ and that the unemployment rate ‘underestimated the deficit’, and the recovery thus left a long way to go.
Treasury yields fell on Tuesday with the ten-year treasury yield amounting to about 1.62%.
General Mills, Tencent, KB Homes and RH are among the companies reporting their earnings on Wednesday.