US equities started the Tuesday session with a steep rally but gave up at the end of the day. Still, the benchmark S&P 500 index (+0.17) and Dow Jones (+0.60%) managed to secure gains. Elsewhere, tech-oriented Nasdaq tumbled 0.81%.
The major indices started to lose momentum when investors realized that the US lawmakers are not on the same page when it comes to unrolling further stimulus.
Senate Majority Leader Mitch McConnell hinted there were few chances that the new money would be green-lighted within the next two weeks. The bill in discussion includes new funds for the paycheck protection program to fuel it for the next six months.
Republicans and Democrats cannot reach consensus on the total sum of the stimulus. The lack of progress over the bill put pressure on equities, which reversed the initial uptrend.
Dow Jones and S&P 500 were driven by financial and energy sectors. Energy stocks rose along with the oil price, which surged on Tuesday. Technology and healthcare were the worst-performing sectors.
Asian stocks are mixed in early trading on Wednesday, as investors monitor the US debate over fresh stimulus. Without new money, the stock markets might halt its rally.
At the time of writing, Japan’s Nikkei 225 is down 0.55%.
South Korea’s KOSPI has declined by 0.08% after initial gains. Economists expect that official GDP data, due tomorrow, would confirm a recession in the second quarter.
Australia’s ASX 200 has dropped 1.37%. Melbourne continues to be under strict lockdown amid a fresh spike in coronavirus cases. Authorities required residents to wear masks.
Hong Kong’s Hang Seng Index is down 0.30%, after initial gains.
China’s Shanghai Composite is up 1.10% while the Shenzhen Component has surged 1.61%.
The same discord will be observed in European markets, as index futures are mixed at the moment.
In individual corporate news, Coca-Cola, a major component of Dow Jones, reported second-quarter earnings that beat forecasts. However, revenue missed analysts’ target. The beverage giant reported EPS of $0.42 on revenue of $7.15 billion, while analysts anticipated EPS of $0.4 on revenue of $7.21 billion. Coca Cola blamed the pandemic for its disappointing revenue.
