U.S. stock futures were under pressure as traders absorbed a historic decline in GDP and braced for the release of corporate earnings from high-flying tech names such as Apple, Facebook and Amazon. Dow Jones Industrial Average futures were down 240 points, or 0.9%. S&P 500 futures slid 0.85% and Nasdaq futures were down nearly 1%. Those losses come after the major averages posted solid gains in the previous session, aided by advances in tech stocks and the Federal Reserve signaling it will stay accommodative for longer.
The U.S. government reported that its initial reading of second-quarter GDP was down a historic 32.9%, not as bad as the 34.7% forecast by economists polled by Dow Jones. A separate report showed that initial claims for jobless benefits rose 1.43 million last week. Economists had expected a 1.45 million rise, according to Dow Jones. The coronavirus-fueled plummet in GDP was the biggest quarterly plunge in activity ever. "This is the largest decline in 70 years of quarterly data," Diane Swonk of Grant Thornton said in anticipation of the report.
Shares of delivery giant UPS surged 10% in the premarket after the company reported better-than-expected results for the previous quarter. UPS posted an adjusted profit of $2.13 per share on revenue of $20.46 billion. Analysts polled by Refinitiv expected earnings per share of $1.07 on revenue of $17.48 billion. The company also reported a surge in consumer shipments of 65.2% during the quarter as the coronavirus pandemic drives demand for residential delivery.
Consumer goods giant Procter & Gamble reported fiscal fourth-quarter earnings and revenue that beat analyst expectations, sending the stock up 2% in the premarket. The company earned an adjusted $1.16 per share on revenue of $17.7 billion. Analysts polled by Refinitiv expected a profit of $1.01 per share on revenue of $16.97 billion. Procter & Gamble's fabric and home care segment — which includes Tide and Comet cleaning products — saw sales growth of 11% during the quarter.
Pascal Soriot, CEO of British pharmaceutical company AstraZeneca, told CNBC that a future coronavirus vaccine may need to be administered every 12 months. "The truth is that we don't know, this virus is very unpredictable," he said. "What we know is that most companies are targeting two injections for the initial vaccination and then our own assumption based on what we know from the technology we use with SARS 1 is that the immunity could last 12 months maybe 18 months." Earlier this year, the U.S. government gave AstraZeneca more than $1 billion in funding for the development of a coronavirus vaccine.