Dow Jones futures point to weak open, Covid-19 cases pass 10 million

Dow Jones futures in focus

On Friday, market volatility ratcheted up another notch – with the Dow Jones, S&P 500 index and Nasdaq Composite all finishing out the session lower.

The Dow Jones Industrial Average was the worst performing here, dropping 730 points or 2.84% to finish out the session at the 25,015 point level. By comparison, the S&P 500 was down 2.42%, while the tech-heavy Nasdaq was down 2.59%.

On a more granular level, only one Dow constituent finished out the session in the green, with networking giant Cisco rising 2.41% to close at US$46.31 per share. By comparison, financial stocks were hit hard on Friday, after the US Federal Reserve announced a cap on major bank dividends and share buybacks.

‘For the third quarter of this year, the board is requiring large banks to preserve capital by suspending share repurchases, capping dividend payments, and allowing dividends according to a formula based on recent income,’ the US Federal Reserve said in a statement.

Unsurprisingly, in response to this news, financial heavyweights Goldman Sachs and JPMorgan Chase saw their share prices bid sharply lower, dropping 8.65% and 5.48%, respectively. NIKE also saw its share price fall 7.62% after the athletics company reported a steep decline in Q4 sales.

Elsewhere, investors are likely to be closely watching the growing coronavirus case counts, as concerns that the United States is on the cusp of a second wave outbreak continue to flare. Indeed, this comes after 10 million global Covid-19 cases were recorded overnight.

Illustrating the severity of the situation, on Sunday the United State’s Health and Human Services Secretary, Alex Azar, warned that the ‘window is closing’ to containing the coronavirus.

Mr Azar went on to stress that ‘We have to act, and people as individuals have to act responsibly. We need to social-distance. We need to wear our face-coverings if we're in settings where we can't social-distance, particularly in these hot zones.’

At the time of writing, 1:18am (New York Time) Dow Jones futures were trading down 26.5 points or 0.11%, implying that the Dow would open the first session of the week lower.

The week ahead

Looking at the key economic releases for the week ending 3 July:

• Pending home sales index data (May) will be released on Monday
• Consumer confidence index data (June) will be released on Tuesday
• Markit manufacturing index (Final) data (June) will be released on Wednesday
• Employment data, including nonfarm payrolls, unemployment rate, average hourly earnings and initial and continuing jobless claims data will be released on Friday

Want to trade US futures: long or short?

Create an IG trading account or log in to your existing account to get started now.