Market Snapshot: Dow aims to rebound from worst day in 3 weeks


The Nasdaq led U.S. stock-index futures higher Wednesday morning as investors continued to monitor rising cases of COVID-19 in Europe and awaited more commentary from Federal Reserve speakers, headlined by a second day of testimony from Chairman Jerome Powell on the health of the economy amid the coronavirus pandemic.

The Dow got a boost from Intel Corp., as the chip maker announced aggressive plans to expand its manufacturing capacity to take back its leadership position in the industry.

How are stock benchmarks performing?

On Tuesday, the Dow

fell 308.05 points, or 0.9%, to close at 32,423.15, to mark its worst daily loss since March 4, according to FactSet data. The S&P 500

declined 30.07 points, or 0.8%, finishing at 3,910.52, while the Nasdaq Composite Index

fell 149.85 points, or 1.1%, to end at 13,227.70.

What’s driving the market?

U.S. stocks were set to trade higher Wednesday against an uncertain backdrop for COVID-19 in parts of the world.

Europe’s recent struggles with limiting the spread of coronavirus has rattled U.S. markets. The extension of lockdown measures in Germany and the Netherlands, until possibly April, have sparked concerns of a slower economic recovery for the region, even as fresh economic data have provided a bright spot.

Business activity in the eurozone unexpectedly grew in March, a preliminary survey showed. IHS Markit’s “flash” composite purchasing managers index, bounced to 52.5 this month, compared with 48.8 in February, rising above the 50 mark, which is seen as the dividing line between contraction and growth.

A flare up in the contagion in the European Union is expected to compel the EU to draft emergency legislation that would allow it to control exports of COVID-19 vaccines, according to a report in the New York Times.

Meanwhile, Powell and Treasury Secretary Janet Yellen are slated to testify before the Senate Banking Committee on Wednesday starting at 10 a. m. Eastern after offering testimony on the economy in front of the House.

Addressing the market’s most substantial bugaboo, Powell on Tuesday said that a rise in inflation “will be neither particularly large nor persistent,” and he repeated the central bank’s intention to use all of its tools to keep prices in check if the economy runs hot.

Some equity bulls see a retreat in yields of benchmark Treasurys as paving a way for stocks to see fresh gains. Yield worries have receded considerably, with the 10-year Treasury note

at 1.63%, compared with 1.729% last Friday.

“Yields are backing off as the market prepares for another round of testimony by Powell and Yellen,” wrote Peter Cardillo, chief market economist at Spartan Capital Securities in a daily note.

“In Summary; we see the yield fear beginning to simmer down paving the way for the bulls to regain market control,” he said.

In economic reports, investors will get a report on the sale of durable-goods orders for February at 8:30 a.m. ET and a flash composite PMI report at 9:45 a.m.

Which stocks are in focus?
  • Intel shares

    climbed 4% in premarket trade, after newly installed Chief Executive Pat Gelsinger laid out an ambitious road map to bounce back from recent manufacturing problems that surfaced last year.
  • GameStop Corp. stock

    was down nearly 13% before the bell as the videogame retailer at the center of the so-called meme-stock phenomenon said it had laid the groundwork for its “transformation,” but disappointed on its recent earnings.
How are other assets trading?
  • The yield on the 10-year U.S. Treasury note

     was fractionally higher at 1.629%. Yields and bond prices move in opposite directions.
  • The ICE U.S. Dollar Index
     a measure of the currency against a basket of six major rivals, was up 0.2%.
  • Oil futures gained after two down days prompted by renewed lockdowns in Europe, with the U.S. benchmark

     up 2.6% to trade near $59.25 a barrel on the New York Mercantile Exchange.
  • Gold futures rose. The April contract GCJ21, 0.23% traded 0.2% higher, near $1,728.90 an ounce.
  • In Europe, the Stoxx 600 index

     slipped 0.1%, as did London’s FTSE 100

  • In Asia, the Shanghai Composite

     fell 1.3%, Hong Kong’s Hang Seng Index

     tumbled 2% and Japan’s Nikkei 225

    dropped 2%.

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