Stocks - U.S. Futures Mixed; Banks Under Pressure

By Peter Nurse   

Investing.com - U.S. stocks are set to open mixed Friday, amid caution as the country battles mounting numbers of Covid-19 cases, hampering efforts to reopen the economy. Bank stocks will be under pressure after the Federal Reserve imposed new restrictions on the sector.

At 7:10 AM ET (1110 GMT), S&P 500 Futures traded 8 points, or 0.3%, higher, Nasdaq Futures up 30 points, or 0.3%. The Dow Futures contract fell 19 points, or 0.1%. 

Wall Street closed higher Thursday, with the Dow Jones Industrial Average up 1.2%, while the S&P 500 index added 1.1% and the Nasdaq Composite index gained 1.1%. The DJIA and S&P 500 are on course to record their second losing week in three, but the Nasdaq is still set to post its fifth positive week in six.

At least 20 million people in the US may already have been infected with Covid-19, according to the latest estimate by the Centers for Disease Control, around 10 times higher than the reported figure.

This comes as the states of Texas and Florida halted their reopening as infections and hospitalizations surged. The U.S. registered a new daily record of over 37,000 new cases on Thursday.

Banks will be in focus Friday after the Federal Reserve said late Thursday that it would impose a cap on dividend payments as well as halting share repurchases for the next three months. 

The limits were imposed after the central bank’s latest stress tests on the sector showed significant capital losses for lenders when tested against the economic impact of Covid-19. All banks were also required to resubmit their capital plans later in their year.

Nike (NYSE:NKE) reported its first quarterly loss in two years after hours Thursday, with a sales decline of 38% year-over-year. Digital sales soared 75%, representing about 30% of total revenue, as shoppers were channeled by lockdowns to Nike’s website for sneakers and workout gear. 

Economic data will center around U.S. personal income and spending Friday. Personal income in May is expected to have declined by 6% compared with a jump of 10% for the previous month, while spending figures may show an increase of 9% compared with a 14% retraction in April as some U.S. states started to reopen. 

Oil prices rose Friday, helped by signs of fuel demand recovering globally, with traders tending to overlook the increase in coronavirus infections in many U.S. states and the recent build in inventories which suggest a revival in U.S. crude production.

At 7:10 AM ET, U.S. crude futures traded 0.8% higher at $39.03 a barrel. The international benchmark Brent contract rose 1.2% to $41.53.

Elsewhere, gold futures rose 0.2% to $1,773.50/oz, while EUR/USD traded at 1.1229, up 0.1%.

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