By Shreyashi Sanyal
(Reuters) – U.S. stock index futures rose on Wednesday as investors turned hopeful of a pickup in business activity with several countries and U.S. states relaxing coronavirus-induced curbs.
After plunging to 2016-lows in March as the sweeping lockdown measures crushed supply chains and consumer demand, the benchmark S&P 500 rebounded strongly in April on unprecedented stimulus and signs the outbreak was peaking.
But with data still foreshadowing a severe economic slump and millions of Americans out of work, analysts have warned of another selloff, particularly if reopening economies sparks another wave of infections.
“For now, markets appear to be pricing in the prospect that economic activity can improve from here on in, and while that may well be true, we still don’t know the extent of the economic damage that has been done already,” said Michael Hewson, chief market analyst at CMC Markets UK.
The ADP (NASDAQ:) National Employment Report is expected to provide another glimpse of the hit to the labor market later on Wednesday, followed by the Labor Department’s more comprehensive nonfarm payrolls data due Friday.
In early premarket trading, Activision Blizzard (O:), jumped 5.4% after raising its revenue forecast on higher demand for video games such as its “Call of Duty” amid lockdowns.
CVS Health Corp (N:) gained 4.1% after the company posted better-than-expected first-quarter profit, as its pharmacy benefits management business and its drugstores benefited from customers stockpiling medicines due to COVID-19 lockdowns.
Walt Disney Co (N:), on the other hand, fell 2% after estimating that global measures to contain the coronavirus cut its profits by $ 1.4 billion, mostly from its shuttered theme parks.
At 7:25 a.m. ET, 1YMcv1> were up 192 points, or 0.81%. S&P 500 e-minis were up 22.5 points, or 0.79% and were up 70.25 points, or 0.79%.
Mattel Inc (O:) plunged 6.2% after the toymaker predicted a steep drop in second-quarter sales on Tuesday.
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