By Devik Jain
(Reuters) – Wall Street’s main indexes were set to open lower on Tuesday as lawmakers geared up for grueling talks over a coronavirus relief deal, with investors also weighing a mixed batch of earnings reports from blue-chip companies.
Senate Republicans announced on Monday a $1 trillion aid package hammered out with the White House — four days before millions of Americans lose unemployment benefits — but the proposal sparked immediate opposition from both Democrats and some Republicans.
Hopes of more government stimulus helped Wall Street’s main indexes close higher on Monday, with traders also tracking corporate America’s forecasts for a business recovery and signs of progress in developing a COVID-19 vaccine.
“We’re in a bit of a pause on the economic recovery while we wait for more progress on the vaccine developments and treatments and wait for the containment measures on the virus to work,” said Jeff Buchbinder, equity strategist at LPL Financial in Greater Boston Area.
Dow component 3M Co <MMM.N> dropped 2.8% premarket as the industrial conglomerate fell short of estimates on quarterly profit and revenue, hurt by a plunge in demand across its business units.
McDonald’s Corp <MCD.N>, another Dow constituent, fell 2.1% after posting a bigger-than-expected drop in global same-store sales and missing profit expectations as it restaurants were shut due to the pandemic.
Pfizer Inc <PFE.N> rose 3.1% after it raised its full-year forecast on strong demand for cancer drug and blood thinner. Late on Monday, the drugmaker announced a pivotal global study to evaluate a COVID-19 vaccine candidate.
About 80% of the 130 S&P 500 companies that reported have surpassed significantly lowered forecasts for profit, according to Refinitiv data, better than the average of 71% companies beating profit estimates over the past four quarters.
A major focus this week will be results from members of Wall Street’s trillion-dollar club — Apple Inc <AAPL.O>, Amazon.com Inc <AMZN.O>, Alphabet Inc <GOOGL.O> — and Facebook Inc <FB.O>.
The U.S. Federal Reserve is expected to reiterate its accommodative stance when it wraps up its two-day policy meeting on Wednesday afternoon. Analysts also expect the central bank to lay down the groundwork for more action later this year.
At 8:29 a.m. ET, Dow e-minis <1YMcv1> were down 131 points, or 0.49%. S&P 500 e-minis <EScv1> were down 12.5 points, or 0.39% and Nasdaq 100 e-minis <NQcv1> were down 55 points, or 0.52%.
On the economic front, the Conference Board’s survey at 10 a.m. ET is expected to show a reading on the U.S. consumer confidence index fell to 94.5 in July from 98.1 in June.
Raytheon Technologies Corp <RTX.N> rose 2.3% as it topped analysts’ estimates for quarterly profit and sales, boosted by strength in its defense business.
(Reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Shounak Dasgupta and Sriraj Kalluvila)
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