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5 things to know before the stock market opens Wednesday

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1. Dow looks to extend winning streak to four sessions

Dow futures were pointing to a 200 point gain at Wednesday’s open, one day after the Dow Jones Industrial Average soared more than 500 points, or 2%, on a record retail sales jump, positive trial results of a potential coronavirus treatment and hopes of more economic stimulus. A higher close for the Dow on Wednesday would extend its winning streak to four straight sessions since Thursday’s nearly 7% plunge.

However, stocks came off their highs Tuesday after Federal Reserve Chairman Jerome Powell told senators that central bankers would adjust corporate bond buying based on market conditions. He also warned that “significant uncertainty remains about the timing and strength of the recovery” and that small businesses are at risk. Powell testifies virtually to Capitol Hill again Wednesday, delivering his semi-annual monetary policy report to a House committee at noon ET.

2. Housing market continues to bounce back

A for sale sign is seen next to a house in Arlington, Virginia on May 6, 2020.

Andrew Caballero-Reynolds | AFP | Getty Images

Homebuyer mortgage demand spiked to an 11-year high last week as rates hit another record low. Purchase applications rose 4% last week and were 21% higher than last year, according to the Mortgage Bankers Association. Refis rose 10% last week and were 106% higher than a year ago.

In another look at the real estate market, the government is out with May housing starts at 8:30 a.m. ET. Economists expect a 22.3% bounce following April’s 30.2% decline to a five-year low. Homebuilding in April fell in all four regions due to coronavirus disruptions to building material supply chains.

3. Beijing looks to contain a new coronavirus cluster

A Chinese epidemic control worker wears a protective suit and mask as he and volunteers direct people at a site where authorities were performing nucleic acid tests for COVID-19 on citizens who have had contact with the the Xinfadi Wholesale Market or someone who has, at an outdoor sports center June 15, 2020 in Beijing, China.

Kevin Frayer | Getty Images

More than 60% of commercial flights in and out of Beijing have been canceled as the Chinese capital looks to contain a new coronavirus cluster. Beijing had basically eradicated local transmission. However, in recent days, there have been 137 cases in the city of 20 million people, leading officials to close schools, suspend reopenings and reimplemented stronger requirements for social distancing. China had relaxed many of its controls after the ruling Communist Party declared victory over the virus in March.

4. Texas governor sees ‘no reason’ to be alarmed

Texas Governor Greg Abbott announced the US Army Corps of Engineers and the state are putting up a 250-bed field hospital at the Kay Bailey Hutchison Convention Center in downtown Dallas during a press conference at the Texas State Capitol in Austin, Sunday, March 29, 2020.

Tom Fox | Getty Images

China’s strong response to new Covid-19 cases in Beijing stands in contrast to the amount of spread the U.S. is willing to endure to reopen its economy. Texas, among the states experiencing spikes since relaxing controls, reported 2,622 new cases of Covid-19 on Tuesday, another daily high for the state. Gov. Greg Abbott blamed the increase on people not wearing masks and not social distancing. “There is no reason right now to be alarmed,” he said, while urging Texans to stay home as much as possible.

5. GOP senators to unveil police reform bill

U.S. Senator Tim Scott (R-SC) talks with law enforcement leaders at an event in the Rose Garden before President Donald Trump signed an executive order on police reform, June 16, 2020.

Leah Millis | Reuters

South Carolina’s Tim Scott, the only Black Republican senator, and a task force of other GOP senators are set to introduce legislation Wednesday to overhaul police procedures and accountability. The 106-page bill is not as sweeping as a Democratic proposal, scheduled for a House vote next week, but it shows how swiftly the national debate has been transformed since last month’s police killing of George Floyd and subsequent protests against racial injustices and inequalities.

The Associated Press contributed to this report.

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