Dow futures dip as Wall Street takes a breather after last week's gains

U.S. stock futures traded lower on Sunday night as investors weigh the latest news on the coronavirus front along with another decline in crude prices. 

Dow Jones Industrial Average futures slid 103 points, or 0.4%. S&P 500 and Nasdaq 100 futures dipped more than 0.4% each. 

Stock futures followed oil prices lower in early trading. The May contract for West Texas Intermediate dropped more than 7% to $16.94 per barrel amid a bleak demand outlook. WTI’s June contract slid over 2% to $24.39 per barrel. 

The market was coming off its first back-to-back weekly gains in more than two months. Stocks got a jolt after a report last week said patients with severe virus symptoms were quickly recovering after using remdesivir, a Gilead Sciences drug. The Dow, S&P 500 and Nasdaq all rose more than 2% last week.

Last week’s gains also put the S&P 500 and Dow more than 30% above their intraday lows set on March 23.

New York Gov. Andrew Cuomo said Sunday the state is “past the high point” of new cases, noting the infection rate has fallen along with coronavirus-related hospitalizations. Cuomo added New York will roll out antibody testing this week. In New Jersey, Gov. Phil Murphy said Saturday: “We’re flattening the curve.”

In Washington, Treasury Secretary Steven Mnuchin said the administration and Congress were close to striking a deal on a second round of loans for small businesses. A $349 billion rescue loan program ran out of money on Thursday.

“The equity markets and bond markets in the US are telling me that my relatively optimistic outlook for the global economy is also what the markets are starting to price in,” Stephen Jen, co-founder of SLJ Macro Partners, wrote in a note. “There is now light at end of the tunnel.”

“While nobody should be under the illusion that the virus will be eradicated soon, it is important to the equity markets that we have gone through most of the known ‘rolling apexes,’ through mitigation measures,” Jen said.

But while the market may be pricing in an improvement in the virus outbreak, recent economic data has been dismal. Over the past month, 22 million jobs have been lost, weekly unemployment claims numbers from the Labor Department showed.

The number of coronavirus related deaths have also risen to more than 165,000 globally, according to Johns Hopkins University. In the U.S., the death toll has risen to over 41,000.

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