U.S. stock market futures jumped on Thursday as investors look ahead to the crucial jobs report for more evidence of an economic rebound in June, despite another daily record in coronavirus cases, plus stocks to watch today in the Money & Markets Opening Bell.
The Top Story
Investor optimism about a rapidly improving economy has fueled a Wall Street rally since March, as the tech-heavy Nasdaq recorded its sixth record closing high since early June on Wednesday.
Recent data indicated U.S. manufacturing in June hit its highest level in more than a year and the Department of Labor’s monthly unemployment report showed the U.S. economy added 4.8 million jobs in June. That’s more than the 2.9 million analysts expected.
But several states are scaling back or pausing reopening to combat a recent surge in coronavirus infections and analysts have cautioned about another sell-off in financial markets if economic damage mounts.
Third-quarter earnings for S&P 500 companies are expected to fall 25% compared with a forecast of a 2.7% drop on April 1. In the second quarter, earnings are forecast to have dropped 43%.
As of 9:20 a.m. EDT, Dow Jones futures were up 1.7%. S&P 500 futures moved 1.28% higher and Nasdaq futures climbed 1%.
Stocks to Watch Today
Tesla Inc. (Nasdaq: TSLA) — The electric carmaker surpassed Toyota as the most valuable auto manufacturer by market capitalization and is expected to have delivered around 72,000 vehicles in the last quarter. Shares of Tesla were up 6.6%.
JetBlue Airways Corp. (Nasdaq: JBLU) — Shares of the low-cost airline were up by 3.5% in premarket trading after it was reported the company reached a deal with its pilots union to avoid involuntary furloughs until May 1, 2021.
Nu Skin Enterprises Inc. (NYSE: NUS) — The personal care products manufacturer raised its revenue estimates for the second quarter to $603 million to $608 million. The company previously forecast revenue of $520 million to $550 million. Shares of Nu Skin were up more than 17%.
Private Equity Firms Scrambling as US Plans to Name Relief Recipients
The $669 billion Paycheck Protection Program was aimed at helping businesses pay their employees during the coronavirus lockdown.
Now the Trump administration is exploring the possibility of releasing the names of those companies who received the forgivable loans from taxpayers, which has left some private equity firms scrambling, according to Bloomberg.
Under the initial terms of the PPP, private equity firms were broadly excluded from receiving funds, however, some managed to get around those restrictions by adjusting governance or ownership arrangements with portfolio companies.
Investors Continue to Pile Into Municipal Bond Market, But Strains Persist
The recent surge in coronavirus cases is putting additional strain on a municipal bond market already reeling from the impact of lockdowns and unemployment.
Ten municipal borrowers defaulted for the first time in May and another 10 did in June — the highest number of defaults for those months since 2012 — according to The Wall Street Journal.
Municipal borrowers are being crushed by the dramatic drop in sales, income and hotel taxes along with other streams of revenue. Despite that, investors continue to pile in to the municipal bond market, looking for stronger yield and more safety than the stock market can provide.
McDonald’s Stops Reopening Plans Amid COVID-19 Case Growth
McDonald’s Corp. (NYSE: MCD) is hitting the pause button on resuming dine-in service at its U.S. restaurants as the coronavirus continues to spread.
According to The Wall Street Journal, the company is waiting three weeks before any new U.S. restaurants add dine-in service to drive-through, takeout and delivery.
Operators started offering limited dine-in service in May and nearly 2,200 of the 14,000 McDonald’s in the U.S. allow customers to eat inside. Those restaurants already open can continue so long as their local government allows it.
What We’re Reading
1 ‘Strong Value’ Buy for the 5G Tech Revolution (Money & Markets)
Being An Unemployed Parent Is About to Get Even Tougher (CNN Business)
The Bull & The Bear: What to Do With These ‘All-American’ Stocks (Money & Markets)
Earnings Report
Here are the companies releasing earnings reports today:
- Korn Ferry (NYSE: KFY)
- Lindsay Corp. (NYSE: LNN)
- TuanChe Ltd. (Nasdaq: TC)
Check back each morning before the opening bell for stocks to watch today with Opening Bell, here on Money & Markets.
Ed Note: Due to the July 4 holiday, there will be no Opening or Closing Bell on Friday. We will return to our normal schedule on Monday, June 6.