Asian stocks followed Wall Street lower on Thursday as hopes USA leaders will agree on a new economic stimulus before the November 3 presidential election faded.
Investors are swinging between optimism about a possible coronavirus vaccine that helped to propel an earlier market rally and unease about lackluster USA economic activity.
Futures tracking the S&P 500 were flat on Wednesday after a mixed bag of quarterly earnings reports from major Wall Street lenders and on doubts about more fiscal stimulus following an impasse in Washington.
At 8:18 a.m. ET, Dow e-minis were up 42 points, or 0.15%, S&P 500 e-minis were up 0.25 points, or 0.01%, and Nasdaq 100 e-minis were up 30.75 points, or 0.25%.
Fading hopes of a deal on federal aid as well as a halt in trials of a COVID-19 vaccine and a treatment pulled Wall Street's main indexes back from one-month highs on Tuesday. "That's making the market nervous and in response, you're seeing the lockdown stocks moving higher". The S&P 500 also fell 0.15% and the Nasdaq Composite dropped 0.47%.
U.S. -listed Chinese companies traded mostly lower, with six of the top 10 stocks by weight in the S&P U.S. Listed China 50 index ending the day on a downbeat note.
This week also marks the start of earnings reporting season for big USA companies, where CEOs will tell investors how they fared from July through September. The Russell 2000 small-caps index gave up 15.20 points, or 0.9%, to 1,621.65.
Supporting the Dow Jones Industrial Average, Walgreens Boots Alliance Inc surged as the drugstore chain forecast single-digit profit growth in 2021 after reporting a better-than-expected fourth-quarter profit.
The sharpest profit drops for the quarter are expected to come from energy stocks, but the sector rose Wednesday to some of the biggest gains among the 11 that make up the S&P 500 index.
But that's not as bad as analysts were forecasting a few months ago, and it's not as bad as the 31.6% drop that S&P 500 companies reported for the spring quarter. But they're forecasting the decline to moderate from the almost 32% plunge from the spring as the economy has shown signs of improvement.
The Shanghai Composite Index lost 0.1% to 3,337.51 and the Nikkei 225 in Tokyo fell 0.5% to 23,517.63.
The Federal Reserve has indicated that it will keep interest rates at almost zero for a while to support the economy, even if inflation hits its target level.
"We do need bipartisan support, we can't do this alone, so I will continue to negotiate until we can get a deal done", Mnuchin said on CNBC, but accused House Speaker Nancy Pelosi of "holding out for an all-or-nothing" deal. Thus far, that extra savings cushion has helped people who lost their job weather the loss of extra unemployment benefits, said Elyse Ausenbaugh, global market strategist at J.P. Morgan Private Bank.