Stock futures were mostly lower Wednesday morning as tensions appeared to flare again between the US and China. Investors also digested a batch of corporate earnings results, and eyed a rocky start to talks over another round of coronavirus-related fiscal stimulus in Washington.

China on Wednesday condemned the US decision to order the closure of China’s consulate in Houston, which the US State Department said was a move to “protect American intellectual property and American’s private information,” a State Department spokesperson said in a statement to multiple media outlets.

This came as relations with the US and China were tested further amid the coronavirus pandemic. The US Justice Department on Tuesday accused two Chinese hackers of attempting to steal data including US research on Covid-19 vaccines on behalf of the Chinese government.

China vowed to retaliate against the forced consulate closure. China’s Foreign Ministry spokesperson Wang Wenbin said in a briefing Wednesday that China intended to “react with firm countermeasures” if the decision was not revoked, according to a Bloomberg report of the briefing.

The developments sent global equities and contracts on the S&P 500 and Dow lower Wednesday morning in New York. Nasdaq futures were slightly higher, however, to steady after the tech-heavy index slipped on Tuesday.

Internet companies including Facebook (FB), Pinterest (PINS) and Twitter (TWTR) extended losses in early trading, falling in sympathy with Snap (SNAP) after the social media company reported a smaller than expected increase in second-quarter daily active user numbers after market close on Tuesday. The results tempered investor expectations for the massive growth tech stocks demonstrated in the first quarter to continue at the same rate the rest of the year. Last week, Netflix (NFLX) had topped expectations for net subscriber additions in the second quarter, but disappointed sharply to the downside for third-quarter guidance.

On Wednesday, more major tech companies are set to report quarterly results, with Microsoft and Tesla set to be among the most highly anticipated. Many Wall Street analysts expect to see Microsoft (MSFT) post another strong quarter of growth especially in Azure, its cloud unit, as many companies kept working remotely during the quarter and leaned on cloud services for day-to-day operations. And Tesla (TSLA) is set to be eligible for consideration for inclusion in the S&P 500 if it ekes out a GAAP profit in its second quarter, which would mark a fourth straight quarter of GAAP profitability. Shares of both Microsoft and Tesla rose in late trading.

Investors also continued to monitor developments in Washington, with debates over another round of fiscal stimulus under way. The White House and Senate Republicans hit impasses on Tuesday, with the two sides sparring over whether or not to include a payroll tax cut, as President Donald Trump has demanded, or add more money for testing and to the Centers for Disease Control and Prevention, among other points of contention.

Treasury Secretary and White House Chief of Staff Mark Meadows told Bloomberg they are aiming to get a package through Congress by the end of next week, or the time at which current measures including the $600 per week in additional federal unemployment benefits are set to end. Senate Majority Leader Mitch McConnell, however, was less certain on a deal passing the end of next week, according to Politico.

7:31 a.m. ET: Pfizer, BioNTech set to receive nearly $2 billion in pact with US to deliver 100 million doses of Covid-19 vaccine

The US government has offered Pfizer (PFE) and BioNTech (BNTX) $1.95 billion in an initial order for 100 million doses of the companies’ Covid-19 vaccine candidate, according to a statement from the companies Wednesday morning. The US government can also acquire up to another 500 million doses of the inoculation, it added.

“Pfizer and BioNTech remain on track to begin an anticipated Phase 2b/3 safety and efficacy trial later this month, seek regulatory review as early as October 2020, and manufacture globally up to 100 million doses by the end of 2020 and potentially more than 1.3 billion doses by the end of 2021,” according to the statement.

Shares of Pfizer jumped more than 5% in early trading following the announcement, and shares of BioNTech jumped 7.7%.

7:26 a.m. ET Wednesday: Stock futures mixed as China tensions rise

Here were the main moves in markets, as of 7:26 a.m. ET:

  • S&P 500 futures (ES=F): 3,244.5, up 6.75 points or 0.21%

  • Dow futures (YM=F): 26,653.00, down 73 points, or 0.27%

  • Nasdaq futures (NQ=F): 10,872.00, up 21 points, or 0.19%

  • Crude (CL=F): -$0.55 (-1.31%) to $41.37 a barrel

  • Gold (GC=F): +$14.70 (+0.8%) to $1,858.60 per ounce

  • 10-year Treasury (^TNX): -1.6 bps to yield 0.591%

6:08 p.m. ET Tuesday: Stock futures open little changed

Here were the main moves at the start of the overnight session for U.S. equity futures, as of 6:08 p.m. ET:

  • S&P 500 futures (ES=F): 3,249.5, down 1.75 points or 0.05%

  • Dow futures (YM=F): 26,717.00, down 9 points, or 0.03%

  • Nasdaq futures (NQ=F): 10,847.00, down 4 points, or 0.04%

NEW YORK, NEW YORK – MAY 26: A trader walks by the New York Stock Exchange (NYSE) on the first day that traders are allowed back onto the historic floor of the exchange on May 26, 2020 in New York City. While only a small number of traders will be returning at this time, those that do will have to take temperature checks and wear face masks at all times while on the floor. The Dow rose over 600 points in morning trading as investors see economic activity in America picking up (Photo by Spencer Platt/Getty Images)

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