Stock market futures trended downward as tensions between the U.S. and China compounded investor worries that a global economic recovery may be slower than expected, plus stocks to watch today in the Money & Markets Opening Bell.
The Top Story
Tensions between the U.S. and China over the origin of the coronavirus have pumped the brakes on Wall Street’s rally in May.
However, the S&P 500 and Nasdaq have managed to hit multi-month highs despite growing concerns over the global economic recovery.
On Wednesday, U.S. Secretary of State Mike Pompeo took aim at Beijing again, calling the $2 billion it has pledged to fight the pandemic “paltry.”
President Donald Trump also escalated his rhetoric against China, suggesting its leader Xi Jinping was behind a “disinformation and propaganda attack on the United States and Europe” in a Wednesday tweet.
Spokesman speaks stupidly on behalf of China, trying desperately to deflect the pain and carnage that their country spread throughout the world. Its disinformation and propaganda attack on the United States and Europe is a disgrace….
— Donald J. Trump (@realDonaldTrump) May 21, 2020
Investors are also weighing the latest weekly jobless claims data which showed another 2.44 million Americans filing for unemployment benefits due to mass layoffs and furloughs as a result of the lockdown.
Claims have subsided since hitting a record 6.8 million in the week ending March 28 and today’s latest report could offer more insight as to how fast businesses will bring back workers as they reopen.
As of 9:20 a.m. EDT, Dow Jones futures were down 0.3%. S&P 500 futures dropped 0.25% and Nasdaq Composite futures were off 0.2%.
Stocks to Watch Today
Best Buy Co. (NYSE: BBY) — The American electronics retailer reported a drop in both revenue and earnings in the last quarter as stores were forced to shut due to the coronavirus lockdown. Shares of Best Buy were down 3%.
Aurora Cannabis Inc. (NYSE: ACB) — Shares of the Canadian cannabis producer shot up 25.7% on news it is acquiring U.S.-based Reliva LLC in a bid to enter the U.S. cannabis market. It is structured as a $40 million all-shares deal.
Take-Two Interactive Software Inc. (Nasdaq: TTWO) — The maker of the Grand Theft Auto and NBA2K series plan for a “light” year of new game releases offset strong fourth-quarter earnings. Shares of Take-Two Interactive were down 4.6%.
US Gives AstraZeneca $1 Billion for COVID-19 Vaccine Development
The U.S. Health Department’s Biomedical Advanced Research and Development Authority granted more than $1 billion to British-Swedish drugmaker AstraZeneca PLC (NYSE: AZN).
The money will be used to develop and supply a COVID-19 vaccine, according to a report from CNBC.
AstraZeneca initially agreed to provide 400 million doses of the vaccine and has secured capacity to produce 1 billion, with first deliveries in September.
Shares of AstraZeneca were up 2.6% in premarket trading.
Large Tech Companies Plan for Acquisition Spree
It may have only been a temporary halt, but industry analysts expect big technology companies to start shopping around for smaller firms later this year.
According to The Wall Street Journal, analysts said large IT firms will be looking to expand into new markets, or fill gaps in current ones, by targeting much smaller companies like start-ups.
The report said the gaps larger firms could be looking to fill include cloud computing, collaboration or access management.
Humans Top Bots in Electronic Bond Trading Test
Apparently bots won’t be replacing humans in the bond market any time soon.
According to Bloomberg, a recent test between human and bot trading found that algorithms used to buy and sell bonds failed in March compared to human traders. The bots were not able to compensate for recent market volatility, according to the report.
What We’re Reading
The Bull & The Bear: Amazon vs. Shopify — Which Is Your Better Buy Right Now? (Money & Markets)
Grocery Store Prices Soared 4.1% in April (USA Today)
Growth Stocks Are Blasting Value Stocks — Pad Your Portfolio With This ETF (Money & Markets)
Earnings Report
Here are the companies releasing earnings reports today:
Best Buy Co. Inc. (NYSE: BBY)
Hewlett Packard Enterprise Co. (NYSE: HPE)
Nvidia Corp. (Nasdaq: NVDA)
Ross Stores Inc. (Nasdaq: ROST)
TJX Companies Inc. (NYSE: TJX)
Check back each morning before the opening bell for stocks to watch today with Opening Bell, here on Money & Markets.