(Reuters) – Wall Street’s main indexes were set to slip from record highs on Tuesday following several disappointing quarterly earnings reports, while investors closely tracked progress in passing a proposed $1.9 trillion stimulus plan.
Take-Two Interactive Software Inc fell nearly 4% after the videogame publisher posted a drop in quarterly adjusted sales and shied away from announcing any new big releases.
Gucci lipstick maker Coty Inc dropped 2.4% as weak demand for makeup products wiped off millions off its quarterly revenue.
Upbeat corporate earnings so far along with monetary and fiscal support have powered the Dow and the S&P 500’s six-day run but analysts have cautioned against risks from the new coronavirus variants and any glitches in vaccine rollouts.
“We’ve come a long way in a short time,” said Josh Wein, portfolio manager with Hennessy Funds. “It won’t take a lot for the market to pause … whether it’s deliberations over fiscal stimulus, or the occasional talk of inflation or interest rates getting some lift.”
Last week’s data showing slower-than-expected growth in the labor market underscored the need for more government aid to blunt the effects of the COVID-19 pandemic.
The White House expects the House of Representatives to track closely to President Joe Biden’s relief plan as it marks up its latest round of legislation but expects lawmakers will tweak some elements.
Meanwhile, new cases of the virus have now fallen for four weeks in a row to the lowest level since early November, although health officials said they were worried new variants of the virus could slow or reverse this progress.
At 8:19 a.m. ET, Dow E-minis were down 78 points, or 0.25% and S&P 500 E-minis were down 8 points, or 0.2%. Nasdaq 100 E-minis were down 22 points, or 0.16%.
Big U.S. banks slipped between 0.5% and 1% in premarket trading, tracking a fall in U.S. Treasury yields. Heavyweight tech-focused companies Apple Inc, Amazon.com Inc and Microsoft Corp were also marginally down.
Toymaker Mattel Inc and telephone equipment maker Cisco Systems Inc slipped ahead of their earnings after market close.
Analysts see fourth-quarter S&P earnings to gain 2.4%, a stark reversal from the 10.3% annual decline seen at the beginning of the year, per Refinitiv.
Glu Mobile Inc jumped about 34% on a $2.4 billion buyout offer from Electronic Arts Inc that would bolster EA’s mobile platform with the addition of games such as “Design Home”, “Covet Fashion”, and “MLB Tap Sports Baseball”.
Bitcoin fast approached the $50,000-mark as the afterglow of Elon Musk-led Tesla’s investment in the cryptocurrency had investors reckoning it may become a mainstream asset class for both corporations and money managers.
Cryptocurrency miner Riot Blockchain and Marathon Patent Group jumped more than 10%, extending their sharp gains for the second day.
Reporting by Medha Singh and Devik Jain in Bengaluru; Editing by Maju Samuel
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