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Optimism about a post-pandemic rebound in business activity,
aggressive U.S. stimulus and hopes of a COVID-19 vaccine have
fueled a Wall Street rally since April, with the tech-heavy
Nasdaq notching up its sixth record closing high since early
June on Wednesday.
After recent data showed U.S. manufacturing in June hit its
highest level in more than a year, the Labor Department's
monthly employment report due later in the day is expected to
show record job growth last month, signaling that a
COVID-19-driven recession was probably over.
But with several states scaling back or pausing reopenings to
tackle a recent surge in coronavirus infections, analysts have
warned of another selloff in financial markets if the damage to
Corporate America mounts.
Third-quarter earnings for S&P 500 companies are now expected to
tumble 25%, compared with a forecast of a 2.7% drop on April 1,
according to IBES data from Refinitiv. In the second quarter,
earnings are forecast to have plunged 43%.
At 6:39 a.m. ET, Dow e-minis <1YMcv1> were up 235 points, or
0.92%, S&P 500 e-minis <EScv1> were up 19.25 points, or 0.62%
and Nasdaq 100 e-minis <NQcv1> were up 39 points, or 0.38%.
Travel-related stocks were among the biggest gainers in
premarket trade, with cruise line operators Carnival Corp <CCL.N>,
Royal Caribbean Cruises Ltd <RCL.N> and Norwegian Cruise Line
Holdings Ltd <NCLH.N> rising between 3% and 4%.
Economically-sensitive stocks including Morgan Stanley <MS.N>,
Goldman Sachs <GS.N>, Citigroup Inc <C.N>, JPMorgan Chase <JPM.N>
and Bank of America Corp <BAC.N> rose between 1% and 3%.
(Reporting by Pawel Goraj in Gdansk; Editing by Sriraj Kalluvila)
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