Stock futures fell early Friday, with Wall Street set to wrap up a difficult week as U.S. fiscal stimulus talks broke down, coronavirus cases rose and a slew of companies reported quarterly earnings.
Futures on the Dow Jones Industrial Average pointed to an opening drop of about 180 points. S&P 500 futures and Nasdaq 100 slid 0.6% and 1%, respectively. Earlier in the session, Dow futures were down more than 500 points.
The Dow is down 5.9% week to date, on pace for its worst week since March 20. The S&P 500 has fallen 4.5% this week, headed for its worst week since June 12.
Earlier in the week, Senate Majority Leader Mitch McConnell adjourned the Senate until Nov. 9, making it unlikely for Democrats and Republicans to reach a deal on new fiscal stimulus. Treasury Secretary Steven Mnuchin, meanwhile, accused House Speaker Nancy Pelosi of miscasting the state of the stalled negotiations, calling it a “political stunt.”
Volatility was also elevated as investors grappled with rising new cases of the coronavirus in the U.S. and abroad. The seven-day average of new coronavirus cases in the U.S. hit an all-time high this week, according to data from Johns Hopkins University. In Europe, Germany and France announce new lockdown measures to curb the virus’ spread.
The Cboe Volatility Index (VIX), also known as Wall Street’s “fear gauge,” touched a high of 41.2 Thursday, its highest level since June 15.
“Pre-election market volatility is not unusual and has arisen around swirling questions about elections, COVID-19, and economic and earnings growth,” Paul Christopher, Wells Fargo’s head of global market strategy, said in a note Thursday. “This indigestion triggered declines in the S&P 500 Index.”
The Dow and the S&P 500 are also set to post their second straight month of losses as Wall Street wraps up a turbulent October. The 30-stock average is down 4% this month, and the S&P 500 has lost 1.5%. The Nasdaq outperformed, rising just 0.2% in the same period.
Shares of Apple fell nearly 4% in premarket trading after the tech giant reported a 16% decline in iPhone sales and failed to offer investors any guidance for the quarter ahead. Amazon dipped 1.4% even after the e-commerce giant reported blowout third-quarter results with a big beat on the top line.
Shares of Alphabet soared more than 5% after the Google parent company posted quarterly results that topped Wall Street expectations. Meanwhile, Twitter dropped more than 15% after the social media company reported user growth that fell short of expectations.
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