US stocks rose slightly at the start of trading on Wednesday as investors braced for the corporate results of major corporations, including Tesla and Microsoft after the close, and watched the increase in Sino-US tests. .
Market participants are also concerned about the state of congressional negotiations on another financial aid package for companies and individuals facing the economic damage caused by the coronavirus pandemic.
How are the benchmarks?
The Dow Jones Industrial Average DJIA,
added 52 points, or 0.2%, to 26,893. The S&P 500 SPX,
It rose 5 points, or 0.2%, to 3,262. The Nasdaq COMP Composite Index,
It gained 25 points, or 0.2%, at 10,706.
On Tuesday, the Dow added 159.53 points, or 0.6%, to end at 26,840.40, the S&P 500 index rose 5.46 points, or 0.2%, at 3,257.30, marking its highest close since February 21 and placing the benchmark 3.8 % since February. .19 high close. Meanwhile, the Nasdaq Composite Index closed at 86.73 points, or 0.8%, below 10,680.36,
What is driving the market?
Renewed concerns about relations between Beijing and Washington are in focus after the United States instructed China to close its consulate in Houston. The development represented a “political provocation unilaterally launched by the United States,” the Chinese Foreign Ministry said during a regular press conference in Beijing. “China urges the United States to immediately rescind its wrong decision, otherwise China will undertake the legitimate and necessary responses,” the official said.
Tensions between global superpowers increase risks to multinational stock valuations during a worsening of the US coronavirus pandemic.
“Tensions between the United States and China have been brewing recently in relation to Hong Kong, and this could be the next chapter in the icy relations between the two countries,” wrote David Madden, market analyst at CMC Markets UK, in a daily research note. .
China also said Tuesday that it would take unspecified “necessary measures” after the United States government imposed trade sanctions on 11 companies that it says are implicated in human rights abuses in the Muslim region of Xinjiang, northwest of China.
Meanwhile, concern that an additional congressional economic package will not be achieved before the end of a $ 600 per week increase in unemployment benefits for millions of Americans at the end of the month was also causing some anxiety among bullish investors. . On Tuesday, Senate Majority Leader Mitch McConnell said Congress is unlikely to pass a new fiscal stimulus bill before lawmakers hit the recess in two weeks.
However, investors have focused their attention on the second-quarter results of American corporations, with Tesla and Microsoft among the leading names to be analyzed by traders on Wednesday.
So far, quarterly results have been better than previously feared. Of the 58 companies that have reported results so far, 77.6% have reported analyst expectations, compared to the average of 65% who reported consensus estimates in previous quarters, according to Refinitiv data, based on In data dating from 1994. A little more than 22% have reported results that are below expectations, compared to an average of 21% that are missing, the data show.
In pandemic news, the number of confirmed cases of COVID-19 cases in the US rose to more than 3.8 million on Tuesday, according to the data, as President Donald Trump changed his view of facial masks. in the face of falling poll numbers before the November elections.
On Tuesday, during his first White House task force briefing in months on the state of the epidemic, he said the coronavirus outbreak could “get worse before it gets better.” There are now 14.8 million confirmed cases of COVID-19 worldwide, and at least 611,599 people have died, Johns Hopkins data shows.
On the economic front of the United States, market participants expect an update on existing home sales for June at 10 am ET.
What actions were in focus?
- InternationalBusiness Machines Corp. IBM
+ 2.17%
increased 1.5% after reporting second-quarter net income of $ 1.36 billion, or $ 1.52 per share, compared to $ 2.5 billion, or $ 2.81 per share, in the same period last year. - Snapchat father Snap Inc. SNAP,
-7.11%
It fell 7% after the social media company failed to meet the expectations of daily active users. - United Airlines Holdings Inc. UAL
-2.41%
Shares fell 1.6% after he said Tuesday night that he lost $ 1.6 billion, or $ 5.79 a share, in the second quarter, in contrast to a gain of $ 1.05 billion, or $ 4.02 per share, in the same quarter of the previous year. - Biogen Inc.
BIIB
+ 1.62%
He said Tuesday night that Michael McDonnell will become chief financial officer on August 15, the day before he reported his quarterly results. Its shares gained 1.6%. - Microsoft Inc.
MSFT
+ 1.02%
and Tesla
TSLA,
+ 2.08%
Results are expected after Wednesday’s close. - The largest blank check buying company sponsored by billionaire hedge funds Bill Ackman will begin trading on Wednesday under the name Pershing Square Tontine Holdings.
- Slack Technologies Inc. JOB,
-1.39%
said Wednesday that he has filed a competition complaint against Microsoft Corp.
MSFT
+ 1.02%
, alleging the illegal and anti-competitive practice of abusing their market dominance, before the European Commission. Slack shares fell 0.9%, while Microsoft shares were trading slightly higher.
Read: Tesla earnings on tap this week: Will a loss end his comeback?
How do other markets operate?
In Europe, the Stoxx 600 Europe SXXP index,
led 0.9% lower, while the UK FTSE UKX,
withdrawn up to 0.9%.
DAX 188658 from Germany,
it traded 0.3% lower, after a 1% gain on Tuesday when the European Union forged its historic recovery package.
GCQ20 Gold Futures,
it extended its climb, rising $ 16, or 0.9%, to $ 1,859.90 an ounce in early trading Wednesday on the New York Mercantile Exchange, adding its maximum to the highest level for the most active contract since September 2011. Futures for August for the US US crude oil benchmark
It lost 1.3% to $ 41.36 a barrel after rising 2.8% on Tuesday.
The 10-year Treasury note yields TMUBMUSD10Y,
edge 1.1 base point lower at about 0.59%. Bond prices move in the opposite direction of returns.
In the currency markets, the dollar was softening 0.1% against its six main rivals, based on the ICE index trading in US dollars. DXY
In Asia, the Nikkei NIK,
closed 0.6% lower, while China’s CSI 300 meter 000300,
added 0.5%. Kospi 180721 from South Korea,
ended in negative territory but practically unchanged; and Hong Kong’s Hang Seng HSI Index,
It fell 2.3%, nullifying its profit on Tuesday.
.
