Dow futures were pointing to a modest decline at Wednesday's open as investors digest two breaking stories. First up, the U.S. said Wednesday morning that it has agreed to pay $1.95 billion for Pfizer to produce and deliver nationally 100 million doses of its Covid-19 vaccine candidate if it proves safe and effective in humans. Shares of Dow-stock Pfizer jumped 5% in the premarket. Secondly, the State Department confirmed an order to close the Chinese consulate in Houston to protect American intellectual property and the private information of U.S. citizens. Beijing has vowed to retaliate.
Profit-taking in high-flying tech stocks Tuesday, including Dow stocks Apple and Microsoft, held back the Dow Jones Industrial Average, which closed 0.6% higher. The Nasdaq, after hitting an intraday record early in Tuesday's session, finished nearly 1% lower. Tech stocks were generally steady in Wednesday's premarket trading.
Microsoft and Tesla report their quarterly results Wednesday afternoon. If Tesla were to deliver a profit, the company would meet a major requirement it needs to join the S&P 500. Despite Tuesday's drop in Tesla shares, CEO Elon Musk qualified for a payout worth $2.1 billion, a second windfall since May following the massive surge in the electric auto maker's stock.
Late Tuesday, United Airlines reported a smaller-than-expected loss of $9.31 per share in the second quarter on revenue of $1.48 billion, which exceeded projections. However, sales plunged 87% from the year-earlier period as the coronavirus pandemic decimated air travel demand. United expects to reduce its cash burn by nearly 38% to $25 million a day in the third quarter.
While airlines and other companies tied to Americans' willingness to get out and about struggle, homebuyer demand remains high. With mortgage rates around record lows, total home loan application volume rose 4.1% last week, according to the Mortgage Bankers Association. Mortgage applications to purchase a home rose 2% for the week and were 19% higher than a year ago. Refinance application volume was up 5% for the week and up 122% from a year ago. Last week, 30-year fixed-rate mortgages remained around 3%.
The daily death toll in the U.S. from the coronavirus topped 1,000 on Tuesday for the first time since May 29, according to the Covid Tracking Project. Texas and Florida posted records in average daily new deaths six times in the previous seven days.
Texas, as of Tuesday, saw five straight days of new cases over 10,000, according to data from Johns Hopkins University. Florida, as of Tuesday, saw eight straight days of new infections over 11,000. Nationally, there were more than 60,000 new Covid-19 cases Tuesday, a continuation of elevated levels but lower than two 70,000-plus days last Thursday and Friday.
President Donald Trump, resuming coronavirus press briefings, said Tuesday evening the pandemic in the U.S. will probably "get worse before it gets better." Trump also said, during his first news conference on Covid-19 from the White House briefing room in nearly three months, that his administration is "in the process of developing a strategy" to combat the escalating outbreak. He said that evolving action plan has "developed as we go along." Trump also urged Americans to wear masks to help contain the virus, following months of his resistance to facing coverings.
— Reuters and The Associated Press contributed to this report.