S&P 500: Futures drop over 1.50% into weekly opening, as second coronavirus wave fears intensify

US stock futures return to the red starting out a fresh week.
Second coronavirus wave fears intensify, with the US, Japan reporting spike in cases.
S&P 500 futures back below 3000 level, points to negative Tokyo open.

Dhwani Mehta FXStreet

The closely watched, risk gauge, the S&P 500 futures tumbled near 1.80% stepping into a fresh week, shrugging off a positive Wall Street close last Friday.

The sentiment was knocked down by the intensifying concerns over the second wave of coronavirus tightening its grip across the globe, with the US and Japan bearing the brunt so far.

The US states of California, Texas and Florida saw a continuous rise in new infections over the weekend, with a mounting number of hospitalizations and deaths, as they push further into the economic re-opening up.

In Asia, the Japanese capital, Tokyo reported 47 new cases on Sunday, the highest count since May 5. The Tokyo Governor Koike, however, downplayed the concerns, citing that the jump in cases resulted from very active testing.

The second wave fears will likely continue to weigh on any optimism over the economic re-opening up optimism while investors remain doubtful about the global economic rebound, given last week’s downbeat projections from the US Federal Reserve (Fed) Chairman J. Powell.

Looking ahead, the risk trends will continue to emerge as the main market driver amid incoming virus updates and key US economic updates. The US Retail Sales data and Powell’s testimony will stand out this week.

At the time of writing, the S&P 500 futures drop 1.25% to 2987, recovering quickly from a 13-day low of 2971.25.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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