U.S. stock futures were pointing to an over 400-point rebound for the Dow Jones Industrial Average at Wednesday's open. Concerns about the unprecedented plunge in oil prices slammed the Dow again Tuesday, wiping out more than 1,200 points this week. Blue chips dropped 2.4% on Monday and 2.7% on Tuesday.
West Texas Intermediate crude, the American benchmark, stabilized Wednesday as the oil meltdown spread to Brent crude, the international standard, early on. WTI and Brent turned higher later Wednesday morning after President Donald Trump tweeted that the U.S. would destroy Iranian gunboats that harassed American ships at sea.
The United States Oil Fund, an exchange-traded security for retail investors that buys oil futures, recovered a bit on Wednesday, a day after sinking over 25% as the fund changed its structure to stave off a collapse. The reasons for the recent declines in oil prices are plummeting demand due to coronavirus lockdowns coupled with the scarcity of oil storage around the world.
Delta Air Lines on Wednesday morning reported a loss of 51 cents per share in its first quarter on revenue of $8.59 billion after burning $100 million in cash a day during coronavirus travel slump. Analysts had expect a 70-cent loss on revenue of nearly $8.92 billion. The airline also expects $5.4 billion in government support. Shares of Delta were higher in the premarket.
Netflix late Tuesday delivered a big jump in subscribers in the first quarter as people stuck at home sought entertainment. Keeping a lid on the stock, earnings per share of $1.57 came in short of expectations. Revenue of $5.77 billion basically matched estimates. The streaming video giant said it could not accurately predict future subscriber growth due to the coronavirus pandemic, calling its estimates "guesswork."
Also Tuesday, Chipotle Mexican Grill reported much better-than-expected adjusted quarterly earnings of $3.08 per share. Revenue of $1.41 billion matched forecasts. An 80% jump in online orders helped blunt the negative impact of the drop in restaurant dining due to the outbreak. Chipotle shares were higher in Wednesday's premarket.
The House is set to vote Thursday on the $484 billion coronavirus relief package that unanimously passed the Senate on Tuesday evening. The measure injects another $310 billion into a key loan fund designed to keep employees on small company payrolls. The initial $350 billion in the Paycheck Protection Program, created as part of last month's $2.2 trillion rescue bill, ran out of money last week. The bill that passed Tuesday allocates $60 billion for small lenders and another $60 billion toward Small Business Administration disaster assistance loans and grants. The legislation also includes $75 billion in hospital aid and $25 billion for virus testing.
The lack of widespread testing for Covid-19 is seen as an impediment to reopening the economy as U.S. cases top 825,000 and deaths surpass 45,000. On Tuesday, White House health advisor Dr. Deborah Birx warned Americans to prepare to see more fatalities, particularly in cities, as the pandemic in the U.S. moves past peak and infection rates decline.
Two people in Santa Clara County, California, who died on Feb. 6 and Feb. 17 are now believed to be the first U.S. deaths associated with the coronavirus. The first death in America was originally believed to be in Washington state on Feb. 29. Looking forward, the Centers for Disease Control and Prevention said Tuesday a second wave of coronavirus in the U.S. this winter could hit much harder because it would likely arrive at the start of flu season.
Fears of a second wave in China, where the virus originated late last year, were behind the city of Beijing's decision to close gyms again. Some fitness centers in Beijing reopened last month for the first time since late January as the outbreak started to slow. How China is reopening its economy is being closely watched as a model of what to possibly expect as the U.S. and other parts of the world start to ease restrictions. Total reported Covid-19 cases in China are nearing 84,000 with over 4,600 deaths, according to data from Johns Hopkins University on Wednesday morning. Globally, cases are approaching 2.6 million with nearly 180,000 deaths.