The Friday Market Minute
- Global stocks pause following record three-day rally on Wall Street as U.S overtakes China as the world's most active coronavirus hotspot.
- G-20 leaders pledge $5 trillion to cushion the coronavirus impact on the world economy, while U.S. lawmakers prepare for the final vote on the $2.2 trillion CARES Act.
- U.S. dollar on pace for its biggest weekly decline in a decade as Fed swap lines ease funding costs.
- Dow rally lifts benchmark 21% higher from its Monday close, marking the best three-day gain in 90 years, sparking hopes for a renewed bull market.
- U.S. equity futures suggest a Friday pullback on Wall Street, however, ahead of February inflation data at 8:30 am Eastern time.
Wall Street futures drifted lower Friday, pulling back from the biggest three-day rally in nearly a century, as investors await the final vote on a $2.2. trillion stimulus bill and digest data showing that the U.S. has overtaken China as the world's most active coronavirus hotspot.
House lawmakers are expected to pass the $2.2 trillion Coronavirus Aid, Relief and Economic Security Act, known as CARES, sometime later today. That will be followed by a signature from President Donald Trump that will officially release at least $500 billion in loans and grants to U.S industry and a further $500 billion in immediate financial support to swathes of American families.
Leaders of the world's 20 largest economies, meanwhile, agreed to provide $5 trillion in collective support to cushion the coronavirus blow following a videoconference summit late Thursday.
"The G20 is committed to do whatever it takes to overcome the pandemic," the leaders said in a communique. "We are strongly committed to presenting a united front against this common threat. Emergency measures aimed at protecting health will be targeted, proportionate, transparent, and temporary."
The combination of fiscal stimulus, unlimited support from the U.S. Federal Reserve, record-low interest rates and similar efforts from governments and central banks around the world has helped lift U.S. stocks nearly 17% over the past three days, even as domestic jobless claims surged to a record high of 3.28 million over the week ending March 21.
That bid looks to have faded into Friday, however, as investors grow increasingly concerned over the spread of coronavirus infections around the world's biggest economy, which have rise to 86,000, overtaking China as the global 'hotspot'.
Futures contracts tied to the Dow Jones Industrial Average, which has gained more than 21% since its Monday close, are indicating a 764 point opening bell decline while those linked to the S&P 500 suggest an 87 point pullback for the broader benchmark.
Nasdaq futures suggest a 223 point decline at the start of trading for the tech-focused index.
Another major mover this week has been the U.S. dollar, which is on track for its biggest decline against a basket of six of its global currency peers since 2009 as central bank efforts -- lead by the Federal Reserve -- ease dollar funding costs for investors in other major economies.
The dollar index was marked 0.025% higher on the session at 99.377, while benchmark 10-year U.S. Treasury bond yields rallied to 0.763% in overnight trading.
European stocks, too, allowed this week's rally to dissipate into the Friday session, after the Stoxx 600 gained 17% from its March 16 low by the close of trading Thursday, with the regional benchmark falling 3.1% in the opening hour of trading.
Britain's FTSE 100, meanwhile, was marked 4.4% lower in London as the pound jumped to 1.2221 against the weaker U.S. dollar.
Global oil prices were mixed in early European trading, but extended declines throughout the session and remain locked at levels that are some 60% lower than at the start of the year, thanks to record U.S. and Saudi Arabian output and collapsing demand linked to the coroanvirus pandemic and its impact of the world economy.
Brent crude futures contracts for May delivery, the global benchmark, were last seen $1.00 lower from their Thursday close in New York and trading at $25.34 per barrel, while WTI contracts for the same month were marked 76 cents lower at $22.84 per barrel.
Overnight in Asia, Japan's Nikkei 225 notched a 3.88% session gain, giving the benchmark its best weekly advance on record, while the region-wide MSCI ex-Japan index edged 0.21% lower heading into the final hours of trading.