By Caitlin Ostroff
U.S. stock futures wavered Friday, suggesting that the major equity benchmarks may end the week largely unchanged as a rapid increase in daily coronavirus infections in some states prompted speculation about new restrictions and a slowdown in the economy reopening.
Futures tied to the S&P 500 wobbled between small gains and losses. The gauge ended Thursday up 1.1%, following a choppy trading session with few clear catalysts.
A number of states, including Arizona, Texas, South Carolina and Florida, saw confirmed cases rise by more than 30% over the past week, according to a Wall Street Journal analysis of data from Johns Hopkins University. Texas paused reopening plans Thursday, and some governors enacted sweeping new measures to help contain the outbreak. But other states, including New York, marched ahead with efforts to revive business and social activity as the infections ebbed.
"Right now, the market is sort-of on hold," said Rhys Herbert, senior economist at Lloyds Banking Group. Investors "are really looking for guidance on what's the next stage: Will we see signs of recovery or is there a danger things slip again?"
Fresh figures showed U.S. consumer spending rose 8.2% in May after seeing a record drop in April, reflecting looser restrictions on businesses, federal stimulus and stepped-up unemployment payments.
"On the one hand, economic data gives us an indication of the pace of the rebound in the economy," Mr. Herbert said. "On the other hand, there's justified concerns of whether the disease is under control."
Public-health officials said only about 1 in every 10 Covid-19 cases in the U.S. has been identified, and more Americans remain susceptible to the virus.
In offhours trading, U.S. bank stocks fell after the Federal Reserve ordered banks to cap shareholder dividend payouts to preserve capital and barred share buybacks in the third quarter. Goldman Sachs Group fell 3.1%, while Wells Fargo retreated 2.9%.
Shares in Nike declined 3.2% in premarket trading after the athletic apparel company said sales fell 38% in the latest quarter, as mass closures of physical stores amid the pandemic overshadowed surging demand online.
Elsewhere, the pan-continental Stoxx Europe 600 rose 1%. Investors' sentiment in the region has been buoyed by the fact that economic data in continental Europe has improved while lockdowns ease without a sharp uptick in coronavirus infections, said Altaf Kassam, head of investment strategy for State Street Global Advisors in Europe.
"In Europe, it feels there is genuine improvement in the mood, in the economy, in the approach central bankers have had," Mr. Kassam said.
U.S.-China tensions also show signs of percolating again after the Senate on Thursday passed a bipartisan bill that would put sanctions on Chinese officials who erode Hong Kong's limited autonomy from Beijing, as well as the banks and firms that do business with them. Trump administration officials have expressed concern the legislation may hamper diplomatic negotiations between the two countries.
Major Asian equity benchmarks ended the day mixed. Hong Kong's Hang Seng Index dropped 0.9%, while Japan's Nikkei 225 gauge climbed 1.1% by the close of trading. Markets in China remained closed for a public holiday.
In bond markets, the yield on the 10-year U.S. Treasury edged down to 0.660%, from 0.674% Thursday.
Write to Caitlin Ostroff at caitlin.ostroff@wsj.com
