Meanwhile, oil is down by about 3% amid rising coronavirus cases in China.
S&P 500 Futures Decline Amid Sell-Off In Tech Stocks
IBM missed analyst estimates on revenue amid weak performance of its Cloud & Congnitive Software segment. IBM stock has underperfomed its tech peers for years, and another disappointing report put significant pressure on the company’s shares which are losing more than 8% in premarket trading.
Meanwhile, Intel stated that it would continue to internally produce the majority of its products. As Intel has recently suffered from production issues, the stock found itself under pressure after this announcement and is currently losing more than 4% in premarket trading.
Oil Is Under Strong Pressure Amid Rising Coronavirus Cases In China
WTI oil is down by about 3% today as traders focus on the continued spread of the virus in China. Strong demand from China is the main driver of the global demand for oil so traders pay close attention to recent developments as the virus starts spreading across the country, forcing Chinese authorities to implement anti-virus measures in affected areas.
The recent API Crude Oil Stock Change report, which indicated that crude inventories increased by 2.6 million barrels, also hurt sentiment, although traders will still wait for confirmation from EIA Weekly Petroleum Status Report which will be published today. Not surprisingly, oil-related stocks are already under significant pressure in premarket trading.
PMI Reports Show That The Second Wave Of The Virus Continues To Put Pressure On The Services Segment
Today, the U.S will release flash PMI reports for January. Manufacturing PMI is projected to decline from 57.1 in December to 56.5 in January while Services PMI is expected to decrease from 54.8 to 53.6.
Many countries have already released their PMI reports which showed that the services segment continued to suffer from the second wave of the virus. Euro Area Services PMI declined from 46.4 to 45 while UK Services PMI decreased from 49.4 to 38.8.
If U.S. Services PMI report is worse than expected, the market will find itself under additional pressure.