Futures contracts that are tied to the major U.S. stock indexes declined on July 8. Concern about the global economic recovery from the coronavirus pandemic weighed on stocks.
Moreover, Japan declared a state of emergency in Tokyo for the upcoming Olympics which spurred the dip. The losses also came as countries deal with a recovery in infections rate because of coronavirus variants.
Dow Jones Industrial Average futures declined by 1.4%, which equals 479 points. Moreover, S&P 500 futures also fell by 1.4%, while Nasdaq 100 futures dipped 1.3%.
In the previous session, both the S&P 500 and Nasdaq Composite closed at records, supported by gains from tech shares.
Premarket declines were led by firms that would benefit from a rapid economic recovery from the virus. Shares of Carnival and Royal Caribbean each fell by over 3%. American Airlines and Delta Air Lines each dropped more than 2% in early trading. Besides, Boeing also eased by 2%. Ford and Nike were also lower. Retailers Lowe’s and Home Depot also slipped in premarket trading.
Chip stocks also tumbled on concerns about the pace of the global recovery. Micron, NVIDIA, Qualcomm, Intel, and Applied Materials, all of them dipped in the premarket.
Timothy Lesko of Granite Investment Advisors also made a statement. According to him, increased coronavirus infections, particularly Delta variants, have caused concerns the economic acceleration will slow. Lesko also added as the markets are at all-time highs, there is little room for economic slowdown in this market.
Although the recovery in inflation and economy, the 10-year Treasury yields resume falling
The 10-year Treasury on Thursday was below 1.255%, to the lowest since late February. Although the economy and inflation are recovering, the 10-year Treasury yields resume falling. It was at 1.58% to start July and reached a 2021 high of 1.78% in March.
Bank of America, Wells Fargo, Goldman Sachs, and other financial shares dipped in premarket trading. Notably, their profitability outlook dimmed with lower rates. Moreover, JPMorgan Chase and PNC Financial were lower.
The S&P 500 soared by 0.3% to a lifetime high of 4,358.13. Meanwhile, the Dow Jones Industrial Average rose 104.42 points and hit 34,681.79. The Nasdaq Composite closed at 14,665.06
Popular internet and technology stocks again outperformed the broader market on July 7. The rise came as investors bought equity in firms that prioritize growth instead of the reopening names in the energy and retail sectors that proved popular in the first half of 2021.
The giant tech firms boosted on Wednesday. Apple gained 1.8%, Microsoft surged 0.8%, and Amazon rose 0.5%. All of them witnessed double-digit gains over the last month.