By Geoffrey Smith
Investing.com -- U.S. stock markets opened flat on Tuesday, with an overnight bounce in futures losing vigor against a backdrop of growing concerns about the global economy.
With Covid-19 cases on the rise in both the U.S. and China, fears that the world's two largest economies could resort to fresh lockdowns are mounting.
By 9:45 AM ET (1345 GMT), the Dow Jones Industrial Average was down 20 points, or less than 0.1%, at 34,782 points. The S&P 500 was flat, while the Nasdaq Composite was up 0.1%.
While the U.S. has so far only seen localized reversals of policy on mask-wearing, China is resorting to ever-more dramatic action to stamp out its latest outbreak of the disease, which started when a plane with an infected passenger landed from Russia in the city of Nanjing. The capital Beijing has banned train arrivals from 20 provinces, while authorities said earlier Tuesday that they will require all 12 million residents of Wuhan, the original source of the pandemic, to be tested again.
There were fresh jitters too among Chinese technology stocks, after the gaming sector was attacked by state-run media. Tencent Holdings ADRs (OTC:TCEHY) fell 6.7% to their lowest in over a year, and NetEase (NASDAQ:NTES) stock fell 9.8%, as participants priced in a new regulatory clampdown.
Of more significance, arguably, was the 3.4% drop in Alibaba ADRs (NYSE:BABA) after the e-commerce giant missed expectations for revenue growth in the second quarter, a further sign after updates from Amazon (NASDAQ:AMZN) and Facebook (NASDAQ:FB) last week that the pandemic-fueled growth in some Internet platform companies is slowing. Another big winner of the pandemic, Clorox (NYSE:CLX) stock, fared even worse - it fell 11% after the maker of cleaning products warned of fading support from virus fears.
Activision Blizzard (NASDAQ:ATVI) stock fell 4.7% after the company said Blizzard President J. Allen Brack is leaving the company, which has been embroiled in a controversy over gender discrimination at the workplace.
Among the gainers were Robinhood (NASDAQ:HOOD)stock, which was jawboned 5.4% higher by some favorable TV punditry, and Under Armour (NYSE:UA), which rose 4.6% after reporting higher sales of sportsgear as social distancing restrictions were loosened in the spring. The standout performer was biotech startup Translate Bio (NASDAQ:TBIO), which rose 29% after French pharma giant Sanofi (NASDAQ:SNY) agreed to buy it for some $3.2 billion.
Elsewhere, the day's only major U.S. data release showed that U.S. manufacturing was still bouncing back handily. Factory orders topped their 2019 levels for the first time with a 1.5% rise, bigger than expected. June's gain was also revised higher from 1.7% to 2.3%.