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S&P 500, Dow head lower as COVID-19 cases climb; eyes on stimulus

Credit: REUTERS/BRENDAN MCDERMID

The S&P 500 and Dow indexes were set to open lower on Monday as concerns about a jump in COVID-19 cases curbed risk appetite, with investors also hoping for more stimulus to shore up a battered global economy.

By Devik Jain and Medha Singh

July 20 (Reuters) - The S&P 500 and Dow indexes were set to open lower on Monday as concerns about a jump in COVID-19 cases curbed risk appetite, with investors also hoping for more stimulus to shore up a battered global economy.

After the U.S. government's $3 trillion commitment to the crisis 12 weeks ago, record levels of new infections have forced many states to backpedal their reopening plans just as those support programs are due to expire.

At least 14 states have reported record hospitalizations so far in July and Florida saw 12,000 new cases on Sunday. Furthermore, the U.S. Centers for Disease Control and Prevention has warned that cases and deaths could rise this autumn and winter.

Congress is set to debate a new aid package this week.

Positive news related to vaccine development, stimulus talks in the United States and Europe could be the three catalysts that help the S&P 500 potentially break through its year-to-date break even level this week, said Thomas Hayes, managing member at Great Hill Capital LLC in New York.

Later in the day, all eyes will be on early-stage human trial data on a vaccine being developed by AstraZeneca Plc AZN.L and Oxford University.

Signs of progress on a potential coronavirus vaccine, improving economic data and a relatively upbeat start to the second-quarter earnings season helped the S&P 500 and the Dow rise for three consecutive weeks.

The benchmark S&P 500 is now less than 5% down from its Feb. 19 record close.

Oilfield services giant Halliburton Co HAL.N rose 5.2% premarket as it posted a surprise adjusted profit benefiting from aggressive cost cuts.

This week, major companies including Microsoft Corp MSFT.O, Amazon.com Inc AMZN.O, Tesla Inc TSLA.O, Intel Corp INTC.O and Honeywell International Inc HON.N are expected to report quarterly results.

At 8:20 a.m. ET, Dow e-minis 1YMcv1 were down 45 points, or 0.17%. S&P 500 e-minis EScv1 were down 4.75 points, or 0.15% and Nasdaq 100 e-minis NQcv1 were up 26.5 points, or 0.25%.

Noble Energy Inc's NBL.O shares jumped 12.4% as Chevron Corp CVX.N agreed to buy the Houston-based oil and gas producer for $5 billion in an all-stock deal. Chevron fell 0.2%. L3N2ER2FR

Pfizer Inc PFE.N rose 3.3%, after Britain signed deals to secure 90 million doses of two possible COVID-19 vaccines from an alliance of the U.S. drugmaker, Germany-based BioNTech 22UAy.F and French group Valneva VLS.PA.

Valneva is also in talks with the European Union for a vaccine supply deal.

(Reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Shounak Dasgupta)

((Devik.Jain@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2062; ;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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