U.S. stock futures were flat in Tuesday morning trading amid renewed investor concerns about the global recovery from the coronavirus pandemic.
Dow futures were up 20 points. S&P 500 futures gained 0.08% and Nasdaq 100 futures rose 0.3%.
On Tuesday, actions linked to an economic recovery led to losses amid an increase in new cases of coronavirus in the United States and abroad.
The Dow Jones Industrial Average lost more than 300 points, pulled down by a 3.4% drop in Caterpillar shares. The S&P 500 fell 0.76%, with heavy losses from airlines and cruises. Nasdaq Composite fell 1.12% as Facebook, Apple and Tesla closed lower.
The Russell 2000 small cap benchmark fell 3.58%, on its worst day since June.
Many regions of the world are seeing increasing cases of Covid-19, as highly contagious variants continue to spread, said the World Health Organization. Germany and France are extending or applying new blocking measures.
Concerns about recovery emerge on the rock bottom one-year anniversary. The stock rebounded from the bottom of the market with the S&P 500 rising about 80% since the low of a year ago, marking the best start to a new bull market ever recorded.
On Wednesday, Federal Reserve Chairman Jerome Powell and Treasury Secretary Janet Yellen will continue their testimony to the US House Financial Services Committee. In their first joint appearance on Tuesday, the pair acknowledged the prices of highly valued assets in the markets, but said they were not concerned about financial stability.
“I would say that while asset valuations are elevated by historical metrics, there is also a belief that, with vaccinations advancing at a rapid pace, the economy will be able to get back on track,” said Yellen during the testimony. “I think in an environment where asset prices are high, the important thing is for regulators to make sure that the financial sector is resilient and that markets function well.”
Powell said the economic recovery from the pandemic “has progressed more quickly than expected and appears to be strengthening.”
However, he said that the sectors of the economy most affected by the pandemic “remain weak” and the unemployment rate “underestimates the deficit”, so the recovery still has a long way to go.
Treasury yields fell on Tuesday, with 10-year Treasury yields hovering around 1.62%.
General Mills, Tencent, KB Homes and HR are among the companies that reported earnings on Wednesday.