U.S. stock futures rose on Tuesday, indicating indexes would reverse some of Monday’s steep decline. Concerns about rising coronavirus cases in Europe and the United States and an impasse over fresh economic stimulus pushed the S&P 500 index nearly 2 percent lower on Monday. European stock indexes continued their descent on Tuesday.
Investors were looking ahead to a busy day of quarterly earnings. Pharmaceutical firms include Merck, Novartis and Pfizer will provide coronavirus treatment updates along with earnings. Microsoft and the manufacturer Caterpillar are also reporting on Tuesday.
The Stoxx Europe 600 fell 0.6 percent. In France, the CAC index dropped 1.1 percent, and the DAX index in Germany was 0.4 percent lower. Stock indexes in Japan and China were little changed. The Kospi index in South Korea and the Hang Seng index in Hong Kong both closed about 0.5 percent lower.
Economists at Berenberg Bank have said that the second wave of the pandemic could all but wipe out economic growth in the eurozone in the fourth quarter of this year. “If virus trends do not start to stabilize in early November, the eurozone economy will likely contract,” at the end of this year, Holger Schmieding, chief economist at Berenberg, wrote in a note.
HSBC was the best performing stock in the benchmark European index. Its share price rose more than 6 percent after it reported a steep drop in profit but said it had lowered its provision for losses on loans and would expand its cost-cutting plan. HSBC also said it would consider paying a dividend next year after suspending it this year.
BP’s shares rose 1.7 percent after the energy company reported a small swing back to profit in the third quarter, compared with steep losses in the previous quarter. BP said it had “significantly lower” results in its oil trading business and the pandemic continued to make energy demand volatile.
There’s an unlikely silver lining to the recession that set in eight months ago: Despite the economic devastation, which tipped millions of people into unemployment, many American households are in relatively good shape, The New York Times’s Stacy Cowley reports.
The pain may still be coming. Banks and other consumer lenders are bracing for financial stress next year, as millions of people remain out of work and the labor market’s rebound shows signs of stalling. But for now, households are weathering the turmoil largely because of the unusual nature of the current downturn.
Even as businesses around the world shut down this spring, executives at EDF Renewables were hopeful they would finish installing 99 wind turbines in southern Nebraska before a year-end deadline. Then, in early April, the pandemic dealt a big blow to the company.
A manager at a factory that was building the giant cylinders on which the turbines sit had died of the coronavirus, shutting down the plant. That and other setbacks — including construction workers at the site in Nebraska contracting the virus — have hampered EDF’s efforts to finish the $374 million project by the end of the year.
The American Wind Energy Association estimates that the pandemic could threaten a total of $35 billion in investment and about 35,000 jobs this year. The losses could grow if the coronavirus continues to disrupt the economy well into next year.
“Every part of the supply chain has been hit by this,” said John Hensley, the wind association’s vice president of research and analytics.
Wind turbines provide more than 7 percent of U.S. electricity and are the largest carbon-free energy source after nuclear power plants. Nebraska gets about 20 percent of its electricity from wind, and when it is complete, EDF’s project will have the capacity to meet the electricity needs of about 115,000 homes.
The wind energy business was growing about 10 percent a year before the pandemic. But industry officials now fear that projects under construction may be postponed or canceled. The industry had hoped Congress might provide aid to renewable energy, but it got little from the stimulus bills passed in the spring.
The industry did receive some help from the Treasury Department, which in May gave wind energy developers more time to complete construction in order to qualify for a federal tax credit. Businesses now have to finish projects they began in 2016 and 2017 within five years, up from four years previously.