Stocks and index ETFs are pulling back again on Tuesday, as lawmakers continued their wrangling over the next coronavirus relief package and investors, and traders examined the most recent group of corporate earnings in one of the busiest release weeks.
The Dow Jones Industrial Average shed 0.45% while the S&P 500 slipped 0.17% as of 1230 pm EST after both indexes looked to register gains based on overnight futures trading. The Nasdaq Composite is still also struggling with losses, after attempting recovery on Monday.
Stock index ETFs are trading in the red along with their underlying benchmarks. The SPDR Dow Jones Industrial Average ETF (DIA), SPDR S&P 500 ETF Trust (SPY), are negative in early afternoon trade Tuesday, while the Invesco QQQ Trust (QQQ) is lower as well, looking like it may finish a fifth down day out of the last six.
McConnell said the bill would regulate federal unemployment insurance at 70% of a worker’s previous wages, replacing the much-coveted $600 per week which states ceased disseminating this week.
“The cutting of the unemployment benefits is setting us up for a political battle and that could take time,” said Peter Cardillo, chief market economist at Spartan Capital Securities, noting this is weighing on market sentiment.
Tech stocks are struggling on Tuesday, after a stellar performance on Monday. where they helped to boost stock indexes, with Apple climbing 2%, and other FAANG member stocks such as Facebook, Amazon, Netflix, and Alphabet, also trading higher. Facebook, Netflix, and Alphabet all gained over 1%, while retail giant Amazon rallied 2.4%. The Vanguard Growth ETF(VUG) gained as well amid the tech advance. Today the fund is off by 0.31%.
This is the most hectic week of the corporate earnings season, with Apple and Amazon among the companies scheduled to report later in the week. Out of the more than 150 S&P 500 companies that have reported calendar second-quarter earning companies thus far, 81% have beaten expectations, according to data from The Earnings Scout.
“The CQ2 reports in the last 12-18 hours, while numerous, don’t really shift the macro narrative a whole lot (they largely confirm what most people already suspect),” said Adam Crisafulli, founder of Vital Knowledge.
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