U.S. stock futures were pointing to a lower open Monday for the Dow Jones Industrial Average. Despite Friday's nearly 1% decline, the Dow finished the week 3% higher, fully recovering and adding 0.5% after a more than 600-point plunge on the last day of January. The worsening coronavirus outbreak in China is still among investor concerns starting the new week. However, with U.S. cases holding steady at around a dozen, Wall Street has been able to largely weather the crisis in recent sessions. The focus will turn to interest rates and the U.S. economy as Federal Reserve Chairman Jerome Powell testifies on Capitol Hill on Tuesday and Wednesday. Powell's take on the coronavirus' economic impact globally and in the U.S. will be of particular interest.
China's National Health Commission said it confirmed 3,062 new cases and 97 additional deaths, mostly in Hubei province, the center of the epidemic in China. The government reported 40,171 confirmed cases 908 deaths in the country. The coronavirus has killed two foreigners, a U.S. citizen and a Japanese national. CNBC's Eunice Yoon reported from Beijing that Tesla's factory in Shanghai was among some of the plants that reopened in China on Monday after being closed for the coronavirus. Local media reported that Tesla employees were seen going into the facility in a bus and wearing masks.
Shares of Tesla were about 7% higher in Monday's premarket trading, with investors encouraged by the Shanghai factory reopening. Tesla had a crazy week last week, making double-digit percentage moves higher Monday and Tuesday and then falling 17% Wednesday. Shares were little changed by comparison Thursday and Friday. The trading is being driven by speculation and a so-called short squeeze and have detached from fundamentals, analysts said. The stock reached as high as $968.99 last week.
The White House's election-year budget will show the economy growing at an average rate of 3% for the next 15 years, said a senior administration official, spurred on by another round of tax cuts and low interest rates. The fiscal 2021 budget, set to be released Monday, includes a plan to extend the disputed tax overhaul that Republicans passed in 2017. The reductions in the individual rate are set to expire in 2025. The White House is proposing to continue those cuts through 2035 at a cost of $1.4 trillion — a figure that serves as a rough placeholder for President Donald Trump's promised "Tax Cuts 2.0."
In finishing just ahead of Sen. Bernie Sanders in the Iowa caucuses, former Mayor Pete Buttigieg earned a measure of legitimacy that he had not previously known. Naturally, his showing in the nation's first nominating contest also brought a flurry of attacks unlike anything Buttigieg has faced in the Democratic presidential race. Sanders leads Buttigieg by about 5 percentage points in New Hampshire heading into Tuesday's primary there.