US STOCKS-Futures drop on fears of second virus wave, bleak economic vie
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* Airlines, cruise operators and casinos tumble
* Banks extend slide as Fed sees rates near zero until 2022
* Boeing (NYSE: BA ) supplier Spirit tumbles after announcing layoffs
* Futures fall: Dow 3.09%, S&P 2.49%, Nasdaq 1.57%
(Adds details, quote; updates prices)
By Medha Singh and Devik Jain
June 11 (Reuters) - U.S. stock futures fell sharply on Thursday on jitters over a second wave of coronavirus infections and a grim forecast for the economy from the Federal Reserve.
Shares of airlines, cruise operators and casinos slumped as a Reuters analysis showed new cases rose in the United States after five weeks of declines. Airlines Holdings Inc UAL.O , American Airlines AAL.O , Norwegian Cruise Line Holdings Ltd NCLH.N , Royal Caribbean Cruises Ltd RCL.N and Wynn Resorts WYNN.O slumped between 9% and 13% in premarket trading.
Wall Street's fear gauge, the CBOE volatility index .VIX , rose above 30 points for the first time since June 1.
"The market has been rallying because they're looking to 2021 and saying we're going to get past this and then things will get sort of back to normal," said Sean O'Hara, president of Pacer ETF Distributors in Malvern, Pennsylvania.
"One thing that really could change the trajectory here would be if we have a big bounce in a second wave. That's the big fear."
The easing of lockdowns and a massive stimulus program to help the economy bounce back quickly to pre-pandemic levels have been pivotal in the S&P 500 .SPX staging a stunning recovery from a deep, virus-induced selloff.
The S&P 500 .SPX and the Dow Jones .DJI indexes ended lower on Wednesday after Fed Chair Jerome Powell acknowledged it could take years for the millions of people laid off due to COVID-19, to get back to work, even as he reiterated his promise to support the virus-hit economy for years. Labor Department report showed about 1.54 million people applied for state unemployment benefits for the week ended June 6, roughly in line with estimates. Co BA.N shed 9.3% after its top supplier Spirit AeroSystems Holdings Inc SPR.N announced a 21-day layoff for staff doing production and support work for Boeing's 737 program. Spirit AeroSystems tumbled 13.2%. 8:32 a.m. ET, Dow e-minis 1YMcv1 were down 834 points, or 3.09%. S&P 500 e-minis EScv1 were down 79.25 points, or 2.49% and Nasdaq 100 e-minis NQcv1 were down 158.75 points, or 1.57%.
Shares of banks, which tend to benefit in a higher rate environment, slipped on Thursday as Fed policymakers saw the key overnight interest rates remaining near zero through at least 2022. of America Corp BAC.N , Citigroup Inc (NYSE: C ) C.N and JPMorgan Chase (NYSE: JPM ) & Co JPM.N fell between 3.8% and 6%.
Online food delivery firm Grubhub Inc GRUB.N rose 10% after Europe's Just Eat Takeaway.com NV TKWY.AS agreed to buy its U.S peer in an all-stock deal for $7.3 billion. The deal, if completed, would create the world's largest food delivery company outside China.
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