By Peter Nurse
Investing.com - U.S. stocks are set to open lower Tuesday, consolidating after recent strong gains as investors wait for more information on the economy, the spread of coronavirus and corporate earnings.
At 7:05 AM ET (1105 GMT), S&P 500 Futures traded 29 points, or 0.9%, lower, Nasdaq Futures down 54 points, or 0.5%. The Dow Futures contract fell 279 points, or 1.1%.
The major U.S. cash indices have been on a winning streak of late, with the S&P 500 and the Nasdaq Composite closing positively the last five days and the Dow Jones Industrial Average four of the last five. The S&P 500 posted its highest close since June 10 on Monday, the Dow is at a three-week peak and the Nasdaq at another all-time high.
Most of the recent economic data released have tended to suggest a strong recovery for the U.S. economy in June, including nonfarm payrolls rising by 4.8 million jobs and the ISM non-manufacturing index bouncing all the way to 57.1.
However, it’s debatable how long this positive stance can last given the resurgence of Covid-19 cases, with at least 32 states reporting higher rates this week compared with the last, according to Johns Hopkins University data.
Atlanta Federal Reserve Bank President Raphael Bostic said Monday the U.S. economic recovery is in danger of stalling due to the recent spike in coronavirus cases across many states. More Fed speakers are due Tuesday, including Bostic himself, Mary Daly and Thomas Barkin.
Earlier in Europe, the European Commission downgraded its growth forecasts, saying it now expects the EU economy to contract by 8.3% in 2020, a significantly greater drop than 7.4% in spring. Growth in 2021 will also be slightly less robust than earlier projected.
In corporate news, retailer Levi Strauss (NYSE:LEVI) reports quarterly results after the closing bell. Tech giants Facebook (NASDAQ:FB), Microsoft (NASDAQ:MSFT), Twitter (NYSE:TWTR) and Alphabet (NASDAQ:GOOGL) will also be in focus after announcing they won’t process user data requests from the Hong Kong government amid concerns that a new security law could criminalize protests.
Oil prices edged lower Tuesday, and the focus will turn to the American Petroleum Institute's report on the level of inventories, after the previous week showed a draw of 8.1 million barrels. Investors will be looking to see whether the fresh wave of coronavirus infections impacted the consumption of oil across the country.
At 7:10 AM ET, U.S. crude futures traded 1.2% lower at $40.16 a barrel. The international benchmark Brent contract fell 0.9% to $42.70.
Elsewhere, gold futures fell 0.6% to $1,783.40/oz, while EUR/USD traded at 1.1282, down 0.2%.