By Geoffrey Smith
Investing.com -- U.S. stock markets edged higher in early trade on Wednesday, slowing a run of three straight daily gains amid concerns about the reviving momentum of the Covid-19 pandemic - both in the U.S. and in China, where it originated.
By 9:35 AM ET (1335 GMT), the Dow Jones Industrial Average was up 51 points or 0.2%, at 26,385 points, while the S&P 500 was effectively flat. The Nasdaq Composite outperformed slightly, rising 0.5%.
The Dow and S&P both suffered from weakness in the travel sector, with cruise line stocks falling sharply after Norwegian Cruise Lines (NYSE:NCLH) extended the suspension of sailings by most of its brands through September. Norwegian stock fell 8.3% in early trade, dragging rivals Carnival (NYSE:CCL) and Royal Caribbean Cruises (NYSE:RCL) over 7% lower in the process.
Oracle (NYSE:ORCL) stock also underperformed after the software company posted weaker-than-expected results for the three months through May after the bell on Tuesday. Oracle was a rare underperformer in the tech space, which profited from moves out of cyclicals as their rally flagged. So-called "stay-at-home" stocks were back in fashion, with Shopify (NYSE:SHOP) stock rising 2.3%, Netflix (NASDAQ:NFLX) stock rising 1.8% and games maker Activision Blizzard (NASDAQ:ATVI) stock rising 1.5%.
In an interview with the Financial Times, the U.S.'s top doctor Anthony Fauci warned that the pandemic is not over in the U.S., pointing to rising numbers of infections in major states such as Texas, Florida and California. Fauci's comments appeared to contradict more or less directly an op-ed in The Wall Street Journal on Tuesday by Vice President Mike Pence, who argued that there would be no second wave and warned against "overblown" panics.
The Chinese capital Beijing meanwhile has greatly expanded its lockdown measures to stop a second wave of Covid-19 cases that has been traced to a local fruit and vegetable market. The city has ordered schools, universities and entertainment venues to be closed, while the neighboring region of Heilonjiang has also imposed a three-week quarantine period. Over 1,000 flights to or from Beijing have been cancelled, but factories and stores have remained open so far.
Oil and gas stocks weakened as the virus news again revived fears for the path of oil demand. Occidental Petroleum (NYSE:OXY) stock fell 3.7% while Exxon Mobil (NYSE:XOM) stock fell 1.8%, as crude prices gave up some of their recent gains, fearing an unexpected build in U.S. inventories. U.S.Crude futures fell 1.8% to $37.66 a barrel.
Gold Futures fell 0.3% to $1,731.05 a troy ounce.