Nasdaq on Track for Its Third Day in the Red in Fallout to Senate Healthcare Delay
New York (June 28) Stock futures were mixed on Wednesday, June 28, as Wall Street digested another delay in the GOP's plans to overhaul the healthcare system, an industry that comprises one-sixth of the U.S. economy.
Nasdaq futures fell 0.4%, setting the index up for its third day in the red. S&P 500 futures were up 0.06%, and Dow Jones Industrial Average futures added 0.05%.
On Tuesday, June 27, the Senate spiked its vote on an Obamacare repeal-and-replace bill as Senate Majority Leader Mitch McConnell faced lack of support from even within his own party. The surprise development provoked a selloff in healthcare, pulling the Nasdaq further into the red.
The Senate decided to delay a vote on the Better Care Reconciliation Act until after the July 4 recess to give McConnell more time to gin up support. The bill had come under attack from members on both side of the aisle. The latest iteration of the Republican plan would increase the number of people without health coverage by 22 million and cut the deficit by $321 billion through 2026, according to estimates released by the Congressional Budget Office released on Monday, June 26. The healthcare bill crafted by Senate Republicans was released last week.
A delay to the GOP's healthcare bill raises more uncertainty over the Trump administration's agenda. Roadblocks in the Obamacare repeal-and-replace process have increased doubts over when tax reform could come to pass. House Speaker Paul Ryan insisted on Tuesday, June 20, that tax reform would come by year's end.
The tech sector was again under pressure on Wednesday. Major industry names have seen steep losses in recent weeks, including major industry names Facebook Inc. (FB) , Apple Inc. (AAPL) , Amazon.com Inc. (AMZN) , Netflix Inc. (NFLX) and Alphabet Inc. (GOOGL) , otherwise known as the FAANG stocks. The stocks comprising the acronym began to slide earlier in June in a pullback from lofty heights reached so far this year. FAANG stocks had contributed a large portion of the S&P 500's gains in the year to date. The Technology Select Sector SPDR ETF (XLK) fell 0.3% in premarket trading.
Apple, Alphabet and Facebook are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells AAPL? Learn more now.
Alex Frew McMillan believes he has identified the Japanese FANGs in his column on our premium site for investors, Real Money. Get his insights with a free trial subscription.
On the economic calendar Wednesday, international trade in goods for May will be out at 8:30 a.m. ET, and the pending home sales index for May is set for 10 a.m.
Crude oil prices were slightly lower ahead of official data on domestic stockpiles from the Energy Information Administration to be released at 10:30 a.m. Inventories have declined in 10 of the past 11 weeks. Data from the American Petroleum Institute on Tuesday, June 27, showed domestic stockpiles rise by 851,000 barrels in the past week, a surprise to analysts looking for a decline.
Crude has been under pressure lately on worries over global oversupply and stubbornly high production. Crude reached its lowest level in 10 months on Wednesday, June 21.
West Texas Intermediate crude was down 0.4% to $44.09 a barrel Wednesday.
Source: TheStreet
