1. Stocks poised to surge again, heading higher for April
Dow’s futures pointed to over 400-point gains on Tuesday’s open as Dow’s stocks 3M, Caterpillar and Pfizer rose in the premarket following the announced earnings and U.S. oil prices plunged. On Monday, the Dow Jones Industrial Average advanced more than 350 points as more states carried out plans to begin easing coronavirus restrictions.
With only a few days left in April, the Dow was above 10%, aiming to break a three-month losing streak with its best monthly results since October 2002. The S&P 500 rose by more than 11 percent in April, also speeding to break the three-month decline stretch with its best monthly output since January 1987. As of Monday’s close, the S&P 500 was around 15% higher than its February all-time peak, and more than 30% higher than its March coronavirus-low. The Dow was more than 30 percent higher than its March low and almost 18 percent higher than its February peak.
2. Four of the Dow-30 firms report earnings
3M shares leaped on Tuesday after the industrial giant posted first-quarter earnings and sales that surpassed expectations as the market for safety equipment and cleaning products soared during the pandemic. The manufacturer of N95 surgical masks posted adjusted earnings per share of $2.16 on sales of $8.1 billion. It revoked its advice due to the uncertainty surrounding the Covid-19 crisis.
Caterpillar’s stock fell on Tuesday amid heavy machinery manufacturers posting first-quarter earnings and sales that missed forecasts. Caterpillar made an estimated profit of $1.60 a share on revenue of $10.6 billion. It did not give any outlook due to the outbreak of the virus.
Pfizer and Merck, both Dow companies, posted higher than anticipated first-quarter earnings and sales on Tuesday. Pfizer received 80 cents per share of sales on $12 billion. Guidelines for 2020 have been reaffirmed. Shares were bigger than that. Merck said it made $1.50 per share on the sale of $12 billion. It lowered the expectation. Shares were smaller.
3. US oil markets are restoring some losses
Wall Street’s turnaround continued as distressed US oil prices regained some of their previous losses in a turbulent session. The price for delivery in June fell by around 7 percent to less than $12 a barrel on Tuesday. Analysts are worried that the June contract for West Texas Intermediate crude, the American benchmark, may crash and likely turn out to be negative, as the May contract did earlier this month on demand and shortage. Adding price pressure on Monday, the U.S. Oil Fund, an exchange-traded product common with retail investors, said it would sell all of its June delivery contracts in favour of longer-term contracts. The July and August contracts were in better shape at around $18 and over $22 a share, respectively.
4. The Fed commences with the two-day April meeting
The April meeting was ended by the Federal Reserve, after introducing the most ambitious initiatives to boost markets and the economy. The Fed is expected to delay any new measures amid the Covid-19 epidemic until it has more details on how these moves are progressing and what lies ahead. According to respondents to the CNBC Fed Poll, it could take one to two years for the economy to return to its full capabilities, with the central bank and Congress need to spend trillions of dollars more along the way. Given major Covid-19 relief, respondents still see the unemployment rate at a high of 19 percent in August.
5. Trump blasts China, sets out the U.S. testing plan
President Donald Trump said that China should have prevented the Covid-19 immediately before it spread across the globe. Present incidents are at the peak of 3 million, with 211,349 deaths. Trump also said Monday that the White House is undertaking significant inquiries into China’s handling of the epidemic, which began in the Chinese city of Wuhan late last year. Beijing replied by saying that some U.S. officials are vying to draw attention from their poor reaction to the virus in their own country.
Trump’s administration launched a new plan Monday to encourage states to improve their capacity to test for Covid-19, saying that much of the work is finished, according to new records. Texas is joining the increasing list of states that are beginning to rebuild their economies. Officials there said they would allow the statewide stay-at-home order to expire on Thursday, with Texas businesses moving on to open in phases on the following day. U.S. Covid-19 cases are up to 1 million, with 56,253 deaths.