Traders wearing masks work inside posts, on the first day of in-person trading since the closure during the outbreak of the coronavirus disease (COVID-19) on the floor at the New York Stock Exchange (NYSE) in New York, U.S., May 26, 2020.
Brendan McDermid | Reuters
U.S. stock futures turned higher early Monday following an earlier decline as coronavirus cases continue surging in the U.S., stoking concerns about the economic reopening and recovery.
The Dow Jones Industrial Average futures implied an opening gain of more than 100 points. S&P 500 futures and Nasdaq-100 futures were little changed. Earlier in the session, Dow futures had traded more than 100 points lower.
Data compiled by Johns Hopkins University showed more than 2.5 million cases have been confirmed across the U.S. On Friday alone, there were 45,255 additional cases were reported, bringing the country’s seven-day average to more than 41% from the prior week.
On Saturday, Florida reported a one-day record of cases of 9,636. The state reported an additional 8,577 on Sunday. Those figures were released after Florida once again banned drinking at bars on Friday. Texas — another state that has seen record spikes in coronavirus infections — rolled back on Friday some of its reopening measures. Arizona Gov. Dough Ducey said Friday cases in the state are “growing fast across all age groups and demographics.”
Health and Human Services Secretary Alex Azar warned on Sunday that the “window is closing” for the U.S. to curb the coronavirus outbreak.
“Reopening plans stumbled – this not only in new virus hotspots like TX and FL, but also impacting international travel – as daily U.S. virus cases surpassed what all had hoped would be their peak in April,” wrote Julian Emanuel, chief equity and derivatives strategist at BTIG.
He also noted the S&P 500 closed below its 200-day moving average — a level closely watched by traders — as Wall Street “paused to assess not only the near-term implications of these risks.”
The major averages posted their second weekly declines in three weeks. The Dow dropped 3.3% last week while the S&P 500 lost 2.9%. The Nasdaq Composite fell 1.9% last week. On Friday, the Dow dropped more than 700 points while the S&P 500 and Nasdaq each fell over 2.4%.
“The bearish argument for the current market is breadth has not strengthened during this period of consolidation,” said Andrew Thrasher, founder of Thrasher Analytics, in a note. “That’s discouraging as more stocks have broken down along with the index.”
Thrasher noted 3,150 will be a key level to watch for investors. “I’m less interested in risky assets until we get back to that level,” he said.
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