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Wall Street Faces More Turmoil as Stocks Waver: Live Updates Wall Street Faces More Turmoil as Stocks Waver: Live Updates
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Stocks fell again on Thursday, even as policymakers in the United States and Europe took more steps to offset the sharp decline gripping their economies.Stocks fell again on Thursday, even as policymakers in the United States and Europe took more steps to offset the sharp decline gripping their economies.
The S&P 500 fell more than 2 percent at the start of trading, and shares in Europe and Asia were also lower. The losses followed a steep drop across financial markets on Wednesday and came as the steady drumbeat of bad news about the spread of the coronavirus continued. The S&P 500 was down as much as 3 percent in early trading before recovering some ground, and shares in Europe and Asia were also lower. Oil prices, which had fallen by more than 20 percent on Wednesday, rebounded on Thursday.
The losses followed a steep drop across financial markets on Wednesday and came as investors faced fresh evidence of the downturn. In the United States, the number of workers filing first-time claims for unemployment insurance surged, government data released on Thursday showed. Those figures don’t reflect the sharp cutbacks that have taken place in the past few days as companies quickly scale down operations as efforts to contain the coronavirus keep consumers at home and force factories to close.
In the United States, the number of workers filing first-time claims for unemployment insurance surged, government data released on Thursday showed. Those figures don’t reflect the sharp cutbacks that have taken place just in the past few days as companies quickly scale down operations as efforts to contain the coronavirus keep consumers at home and force factories to close. Overnight, the European Central Bank unveiled a huge bond-buying program aimed at preventing economic calamity, and the Fed presented a plan to support money market funds, which are threatened when there is a rush for cash. U.S. officials also neared passage of stimulus efforts to keep the American economy running.
Investors were dealing with a flurry of news. Overnight, the European Central Bank unveiled a huge bond-buying program aimed at preventing economic calamity, and the Fed presented a plan to support money market funds, which are threatened when there is a rush for cash. U.S. officials also neared passage of stimulus efforts to keep the American economy running. On Thursday, Treasury Secretary Steven Mnuchin said that the White House’s economic relief plan includes sending checks to the public of $1,000 for every American adult and $500 per child within three weeks. If the crisis continues, the plan would be to send checks of the same amounts again in May.
On Thursday, Treasury Secretary Steven Mnuchin said that the White House’s economic relief plan includes sending $1,000 for every American adult and $500 per child within three weeks. If the crisis continues, the plan would be to send checks of the same amounts again in May. But news of efforts to bolster the economy has been matched by a sharp escalation in the number of coronavirus cases in Europe and the United States, and fresh evidence of the impact on businesses. On Thursday, Ford Motor said that it would suspend its divided payment and draw down about $15 billion from two lines of credit to help offset the impact of coronavirus-related production shutdowns, becoming just the latest company to take such measures in order to cushion itself.
But news of efforts to bolster the economy has been matched by a sharp escalation in the number of coronavirus cases in Europe and the United States and fresh evidence of the impact on businesses. On Thursday, Ford Motor said it would suspend its divided payment, and draw down about $15 billion from two lines of credit to help offset the impact of coronavirus-related production shut downs, becoming just the latest company to take such measures in order to cushion itself.
Ford’s shares fell by more than 7 percent on Thursday.
The waves of selling in the past month have left the Dow Jones industrial average back where it stood in January 2017, as President Trump took office — erasing the gains that had become one of his primary measures of success in the White House.The waves of selling in the past month have left the Dow Jones industrial average back where it stood in January 2017, as President Trump took office — erasing the gains that had become one of his primary measures of success in the White House.
Economists in recent days have made increasingly dire predictions about the likely damage to the job market, with many predicting that the unemployment rate will quickly surpass the 10 percent level it hit in the worst of the last recession.
“This is a body blow to the economy unlike anything we’ve experienced in recent memory,” said Patrick Anderson, an economist in East Lansing, Mich. “Even the Great Recession did not include shuttering of businesses by government order at the same time that people were being told to say home and distance themselves.”
Layoffs rose sharply last week as the effects of the coronavirus pandemic began to ripple through the economy. The worst is yet to come.Layoffs rose sharply last week as the effects of the coronavirus pandemic began to ripple through the economy. The worst is yet to come.
Some 281,000 Americans filed first-time claims for unemployment insurance, up by 33 percent from 211,000 the week before, the Labor Department said Thursday. On a percentage basis, the increase was among the largest one-week spikes on record.Some 281,000 Americans filed first-time claims for unemployment insurance, up by 33 percent from 211,000 the week before, the Labor Department said Thursday. On a percentage basis, the increase was among the largest one-week spikes on record.
The Labor Department said the increase was “clearly attributable to impacts from the COVID-19 virus” and noted that many states reported a rise in jobless claims from workers in food services, accommodation and travel.The Labor Department said the increase was “clearly attributable to impacts from the COVID-19 virus” and noted that many states reported a rise in jobless claims from workers in food services, accommodation and travel.
Still, the data released Thursday was for claims filed from March 8-14, before the outbreak began to shut down restaurants, bars and retail stores in much of the country. The next report, which will reflect the first wave of closings, will almost certainly be much worse. Individual states from California to Rhode Island have released their own data showing enormous spikes in jobless claims; on Monday, the website to apply for benefits in New York state crashed amid the crush of inquiries. Still, the data released Thursday was for claims filed from March 8-14, before the outbreak began to shut down restaurants, bars and retail stores in much of the country. The next report, which will reflect the first wave of closings, will almost certainly be much worse.
Economists in recent days have made increasingly dire predictions about the likely damage to the job market, with many predicting that the unemployment rate will quickly surpass the 10 percent level it hit in the worst of the last recession.
“This is a body blow to the economy unlike anything we’ve experienced in recent memory,” said Patrick Anderson, an economist in East Lansing, Mich. “Even the Great Recession did not include shuttering of businesses by government order at the same time that people were being told to say home and distance themselves.”
The Federal Reserve said late Wednesday night that it would offer emergency loans to money market mutual funds, its latest in a series of steps to keep the financial system functioning and prop up the economy as it spirals toward recession during the coronavirus pandemic.The Federal Reserve said late Wednesday night that it would offer emergency loans to money market mutual funds, its latest in a series of steps to keep the financial system functioning and prop up the economy as it spirals toward recession during the coronavirus pandemic.
Officials said they would establish a so-called Money Market Mutual Fund Liquidity Facility, which would be backed by $10 billion from the Treasury Department. That facility joins a similar lending program for banks, established earlier this week.Officials said they would establish a so-called Money Market Mutual Fund Liquidity Facility, which would be backed by $10 billion from the Treasury Department. That facility joins a similar lending program for banks, established earlier this week.
The Fed is trying to protect the financial system and insulate the broader economy, where short-term pain could turn into long-term suffering if credit crunches prevent companies from obtaining the cash they need to function, forcing them to lay off workers, delay payments to vendors and shutter plants. The Fed is trying to protect the financial system and insulate the broader economy, where short-term pain could turn into long-term suffering if credit crunches prevent companies from obtaining the cash they need to function.
Uber, like many transportation companies, saw its stock decline drastically over the last few weeks as coronavirus took hold and people were encouraged to stop traveling and stay home. Drivers have said that their work vanished seemingly overnight. As Uber ridership has vanished, the company is seeking to reassure investors about how it will fare.
Dara Khosrowshahi, Uber’s chief executive, sought to reassure investors during a conference call with analysts on Monday morning. Uber was preparing multiple models to gauge how it would fare as the pandemic continues, he said, and had about $10 billion cash on hand to weather the storm. Dara Khosrowshahi, Uber’s chief executive, told investors during a conference call on Monday morning that Uber was preparing multiple models to gauge how it would fare as the pandemic continues, and that it had about $10 billion cash on hand to weather the storm.
“Our business is incredibly resilient and will bounce back,” Mr. Khosrowshahi said. “In some parts of our business, we are already seeing what we believe is the worst of the impact behind us.”“Our business is incredibly resilient and will bounce back,” Mr. Khosrowshahi said. “In some parts of our business, we are already seeing what we believe is the worst of the impact behind us.”
Uber did not update its revenue guidance, but revealed that in Hong Kong, rides had fallen by 45 percent from the previous year at the height of the outbreak there, before recovering slightly to a 30 percent decline. In Seattle, rides were down between 60 and 70 percent.Uber did not update its revenue guidance, but revealed that in Hong Kong, rides had fallen by 45 percent from the previous year at the height of the outbreak there, before recovering slightly to a 30 percent decline. In Seattle, rides were down between 60 and 70 percent.
Investors, corporations and trading clients are turning to Wall Street amid one of the most tumultuous periods in market history to borrow money, buy or sell assets, and limit losses on their holdings. But Wall Street itself is grappling with a challenge it never previously faced: how to protect employees from a worsening public-health threat while managing clients who need services around the clock.Investors, corporations and trading clients are turning to Wall Street amid one of the most tumultuous periods in market history to borrow money, buy or sell assets, and limit losses on their holdings. But Wall Street itself is grappling with a challenge it never previously faced: how to protect employees from a worsening public-health threat while managing clients who need services around the clock.
As the week started, numerous financial services firms — from the investment bank Goldman Sachs to the private equity firm Blackstone to the hedge fund Point72 — were adopting emergency work policies as employees tested positive for coronavirus. As far away as Cape Town, the commodities analyst Jeffrey Christian, who had traveled there from New York on business, was in an emergency room with chills and a fever.As the week started, numerous financial services firms — from the investment bank Goldman Sachs to the private equity firm Blackstone to the hedge fund Point72 — were adopting emergency work policies as employees tested positive for coronavirus. As far away as Cape Town, the commodities analyst Jeffrey Christian, who had traveled there from New York on business, was in an emergency room with chills and a fever.
“Waiting to be tested for C19,” wrote Mr. Christian, the managing partner of the research firm CPM Group, in an email. “Woke up with nasty fever and chills today.”“Waiting to be tested for C19,” wrote Mr. Christian, the managing partner of the research firm CPM Group, in an email. “Woke up with nasty fever and chills today.”
As household incomes feel the impact of the economic crisis from the coronavirus outbreak, there has been a groundswell of moves across the country to protect renters from eviction.As household incomes feel the impact of the economic crisis from the coronavirus outbreak, there has been a groundswell of moves across the country to protect renters from eviction.
The Miami-Dade police in Florida said they wouldn’t carry out evictions. A New York State judge declared that the courts would consider no eviction cases until further notice. Gov. Gavin Newsom of California issued an executive order allowing cities to impose eviction moratoriums.The Miami-Dade police in Florida said they wouldn’t carry out evictions. A New York State judge declared that the courts would consider no eviction cases until further notice. Gov. Gavin Newsom of California issued an executive order allowing cities to impose eviction moratoriums.
“The very least policymakers can do during a national health emergency is ensure that more people are not pushed into homelessness,” said Diane Yentel, chief executive of the National Low Income Housing Coalition, a nonprofit advocacy group in Washington “The very least policymakers can do during a national health emergency is ensure that more people are not pushed into homelessness,” said Diane Yentel, chief executive of the National Low Income Housing Coalition, a nonprofit advocacy group in Washington.
There has also been action to keep homeowners from being pushed into default on their mortgages. On Wednesday, the federal agency overseeing Fannie Mae and Freddie Mac, the giant government-run finance firms that back the mortgages of 28 million homeowners, ordered a suspension of foreclosures and foreclosure-related evictions for at least two months. On Wednesday, the federal agency overseeing Fannie Mae and Freddie Mac, the giant government-run finance firms that back the mortgages of 28 million homeowners, ordered a suspension of foreclosures and foreclosure-related evictions for at least two months.
The European Central Bank said it would embark on an enormous wave of bond purchases intended to counter the “serious risks” to the eurozone caused by the coronavirus pandemic.The European Central Bank said it would embark on an enormous wave of bond purchases intended to counter the “serious risks” to the eurozone caused by the coronavirus pandemic.
The bank will buy up to 750 billion euros, or $820 billion, in government and corporate bonds and other assets, pumping cash into financial markets deeply rattled by the pandemic.The bank will buy up to 750 billion euros, or $820 billion, in government and corporate bonds and other assets, pumping cash into financial markets deeply rattled by the pandemic.
The announcement came after an unusual late-night conference call among members of the bank’s Governing Council, which followed signs that bond investors were losing faith in Italy’s ability to repay its enormous government debt. If Italy’s borrowing costs reach unsustainable levels, the future of the eurozone would be at stake.The announcement came after an unusual late-night conference call among members of the bank’s Governing Council, which followed signs that bond investors were losing faith in Italy’s ability to repay its enormous government debt. If Italy’s borrowing costs reach unsustainable levels, the future of the eurozone would be at stake.
The Governing Council said it would “do everything necessary within its mandate” to support the eurozone economy during the crisis.
That expression of resolve caused the risk premium on Italian 10-year government bonds to fall by 30 percent in morning trading, while the risk premium on Greek 10-year debt fell by more than 40 percent.
Major American corporations spent roughly $1.4 trillion dollars buying back their own shares over the last three years, according to Goldman Sachs.Major American corporations spent roughly $1.4 trillion dollars buying back their own shares over the last three years, according to Goldman Sachs.
Now, after a stock market crash that has pushed prices back to where they were in early 2017, almost all that money is gone, at least for the moment.Now, after a stock market crash that has pushed prices back to where they were in early 2017, almost all that money is gone, at least for the moment.
The penchant of American corporations for buying back their own shares — it is largely an American phenomenon — became a political football in recent years. The Trump administration sold its vast overhaul of the American tax system, which was signed into law in December 2017, as a measure that would supercharge capital investment from companies, increasing productivity and wages for workers.The penchant of American corporations for buying back their own shares — it is largely an American phenomenon — became a political football in recent years. The Trump administration sold its vast overhaul of the American tax system, which was signed into law in December 2017, as a measure that would supercharge capital investment from companies, increasing productivity and wages for workers.
The tax overhaul left major American companies flush with cash, and set off a record amount of share buybacks by S&P 500 companies. Buybacks hit a record in 2018, with net buybacks accounting for roughly $600 billion in outlays from companies, according to Goldman Sachs. The full numbers for 2019 are still coming in but are estimated to be around $480 billion.The tax overhaul left major American companies flush with cash, and set off a record amount of share buybacks by S&P 500 companies. Buybacks hit a record in 2018, with net buybacks accounting for roughly $600 billion in outlays from companies, according to Goldman Sachs. The full numbers for 2019 are still coming in but are estimated to be around $480 billion.
Defenders of buybacks say it is an efficient way for companies to return money to shareholders that they would not otherwise know how to invest efficiently.Defenders of buybacks say it is an efficient way for companies to return money to shareholders that they would not otherwise know how to invest efficiently.
Critics say the practice is merely a way to inflate share prices and burnish key metrics, such as earnings per share, which look better because buybacks reduce the number of shares a company has. They point out that companies can always pay shareholders with dividends, which are checks issued directly to stock owners, rather than by buying back shares.Critics say the practice is merely a way to inflate share prices and burnish key metrics, such as earnings per share, which look better because buybacks reduce the number of shares a company has. They point out that companies can always pay shareholders with dividends, which are checks issued directly to stock owners, rather than by buying back shares.
A reliable predictor of German economic growth suffered its biggest plunge since eastern and western Germany reunited almost three decades ago. The Ifo Institute’s monthly survey of how managers expect their business to develop, published on Thursday, has a good record in predicting the direction of Europe’s largest economy.A reliable predictor of German economic growth suffered its biggest plunge since eastern and western Germany reunited almost three decades ago. The Ifo Institute’s monthly survey of how managers expect their business to develop, published on Thursday, has a good record in predicting the direction of Europe’s largest economy.
Burberry, the British luxury fashion brand known for its trench coats and plaid, expects store sales to plunge as much as 80 percent. Though the initial losses were in Asia, the company said currently sales in the Americas, where over 85 percent of its stores are closed, and in Europe, Middle East, Africa and India, where over 60 percent are shut, are “materially” lower.
Australia’s central bank said on Thursday that it would cut its key interest rate to 0.25 percent to ward off a coronavirus-spurred recession. It will also begin buying government bonds, the first time in the country’s history it would use quantitative easing.Australia’s central bank said on Thursday that it would cut its key interest rate to 0.25 percent to ward off a coronavirus-spurred recession. It will also begin buying government bonds, the first time in the country’s history it would use quantitative easing.
Reporting and research were contributed by Ben Casselman, Conor Dougherty, Emily Flitter, Isabella Kwai, Jack Ewing, Carlos Tejada, Kate Conger, Heather Murphy, Matt Phillips, Jeanna Smialek and Jim Tankersley. Reporting and research were contributed by Ben Casselman, Conor Dougherty, Emily Flitter, Isabella Kwai, Jack Ewing, Carlos Tejada, Kate Conger, Jason Karaian, Heather Murphy, Matt Phillips, Jeanna Smialek and Jim Tankersley.