U.S. stock futures opened sharply lower on Sunday night as Wall Street waits on Washington to agree to an economic stimulus and rescue plan to combat the giant economic blow from the coronavirus outbreak.
Futures could be highly volatile as headlines come out of a coronavirus task force news conference Sunday evening and as traders await news on a stimulus bill agreement (or lack of one).
Treasury Secretary Steven Mnuchin said Sunday that financing programs to stimulate the economy could be worth $4 trillion, noting these efforts will include coordination with the Federal Reserve to provide businesses with necessary liquidity.
National Economic Council Director Larry Kudlow also said Saturday an economic stimulus package will total more than $2 trillion, noting it will be equal to roughly 10% of U.S. economic output. Last week, President Donald Trump signed a $100 billion bill that expanded paid leave in the U.S.
David Kostin, chief U.S. equity strategist at Goldman Sachs, said the difference between a fast or a prolonged recovery in the stock market will come down to three factors: How quickly the virus is contained, whether businesses will have ” access to enough capital and liquidity to last the 90 to 180 days,” and whether fiscal stimulus can stabilize growth forecasts.