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Investors Brace for U.S. Jobs Data: Live Markets Updates More Than 5.2 Million U.S. Workers Filed for Unemployment: Live Updates
(32 minutes later)
Each day seems to bring unwelcome economic milestones. Another is expected to arrive Thursday with the fourth-straight weekly tally of new unemployment claims likely to be in the millions.
Ahead of the Labor Department report, due at 8:30 a.m., the consensus estimate cited by Bloomberg is 5.5 million new unemployment claims. Torsten Slok, chief economist at Deutsche Bank Securities, is expecting a number around eight million. His assumption is based on the earlier inability of many workers to file claims because of technical glitches at overwhelmed state labor departments. The coronavirus pandemic’s devastation became more evident Thursday with more than 5.2 million workers added to the tally of the unemployed.
If Mr. Slok’s estimate is right, it would bring the cumulative U.S. job losses to 25 million. The latest figure from the Labor Department, reflecting last week’s initial unemployment claims, brings the four-week total to about 22 million. That’s roughly the net number of jobs created in a nine-and-a-half-year stretch that began after the last recession and ended with the pandemic’s arrival.
“All of the last decade in job gains will be undone in four weeks, which is a truly stunning statistic,” he said. “It tells you the severity of the situation.” It underscores how the downdraft has spread to every corner of the economy: hotels and restaurants, mass retailers, manufacturers and white-collar strongholds like law firms.
And it will be only the latest measure. On Wednesday, the Commerce Department reported the steepest monthly drop in retail sales since those statistics started being compiled nearly 30 years ago, and the Federal Reserve said industrial production had recorded its biggest decline since 1946. “There’s nowhere to hide,” said Diane Swonk, chief economist at Grant Thornton in Chicago. “This is the deepest, fastest, most broad-based recession we’ve ever seen.”
The mounting unemployment numbers seem certain to fuel the debate over how long to impose stay-at-home orders and restrictions on business activity. Some of the new jobless claims represent freshly laid-off workers; others are from people who had been trying for a week or more to file. “We’re still playing catch-up on multiple fronts,” Ms. Swonk said.
President Trump has said some measures should be relaxed soon because of the impact on workers. “There has to be a balance,” he said at a news briefing Wednesday evening. “We have to get back to work.” Each day seems to bring unwelcome milestones. On Wednesday, the Commerce Department reported the steepest monthly drop in retail sales since record keeping began nearly 30 years ago, and the Federal Reserve said industrial production had recorded its biggest decline since 1946.
The mounting unemployment numbers seem certain to fuel the debate over how long to impose stay-at-home orders and restrictions on business activity. President Trump has said some measures should be relaxed soon because of the impact on workers. “There has to be a balance,” he said at a press briefing Wednesday evening. “We have to get back to work.”
Who would have thought that a crisis that began with mortgage defaults in American suburbs in 2007 would lead to a fiscal crisis in Greece in 2010? Or that a stock market crash in New York in 1929 would contribute to the rise of fascists in Europe in the 1930s?Who would have thought that a crisis that began with mortgage defaults in American suburbs in 2007 would lead to a fiscal crisis in Greece in 2010? Or that a stock market crash in New York in 1929 would contribute to the rise of fascists in Europe in the 1930s?
In the years ahead, we will learn what happens when the infinitely complicated web of interconnections that makes up the world economy is torn apart. And it opens the possibility of a global economy completely different from the one that has prevailed in recent decades.In the years ahead, we will learn what happens when the infinitely complicated web of interconnections that makes up the world economy is torn apart. And it opens the possibility of a global economy completely different from the one that has prevailed in recent decades.
“This is a period of radical uncertainty, an order of magnitude greater than anything we’re used to,” said Adam Tooze, a historian at Columbia University and author of “Crashed,” a study of the extensive global ripple effects of the 2008 financial crisis.“This is a period of radical uncertainty, an order of magnitude greater than anything we’re used to,” said Adam Tooze, a historian at Columbia University and author of “Crashed,” a study of the extensive global ripple effects of the 2008 financial crisis.
Crises have a way of bringing to the fore issues that are easy to ignore in good times.Crises have a way of bringing to the fore issues that are easy to ignore in good times.
One obvious candidate is globalization, in which companies can move production wherever it’s most efficient, people can hop on a plane and go nearly anywhere, and money can flow to wherever it will be put to its highest use. The idea of a world economy with the United States at its center was already falling apart, between the rise of China and the United States’ own turn toward nationalism.One obvious candidate is globalization, in which companies can move production wherever it’s most efficient, people can hop on a plane and go nearly anywhere, and money can flow to wherever it will be put to its highest use. The idea of a world economy with the United States at its center was already falling apart, between the rise of China and the United States’ own turn toward nationalism.
There are signs that the coronavirus crisis is exaggerating, and possibly cementing, those changes.There are signs that the coronavirus crisis is exaggerating, and possibly cementing, those changes.
U.S. stock futures rose and European markets inched higher on Thursday as investors braced for new government and corporate figures to further detail the economic damage from the coronavirus outbreak.U.S. stock futures rose and European markets inched higher on Thursday as investors braced for new government and corporate figures to further detail the economic damage from the coronavirus outbreak.
Futures for the S&P 500 signaled a rise at the open of trading.Futures for the S&P 500 signaled a rise at the open of trading.
Investors are likely to hear another spate of bad economic news. Weekly unemployment claims data in the United States was expected on Thursday to show another mass shedding of jobs, and more companies are scheduled to report the hit to their financial results during the first three months of the year.Investors are likely to hear another spate of bad economic news. Weekly unemployment claims data in the United States was expected on Thursday to show another mass shedding of jobs, and more companies are scheduled to report the hit to their financial results during the first three months of the year.
On Wednesday, the S&P 500 tumbled more than 2 percent as investors were faced with further data showing the economic damage of efforts to contain the coronavirus pandemic, including a historic plunge in retail sales and a slump in factory output.On Wednesday, the S&P 500 tumbled more than 2 percent as investors were faced with further data showing the economic damage of efforts to contain the coronavirus pandemic, including a historic plunge in retail sales and a slump in factory output.
Though still far from the record reached on Feb. 19, stocks in the United States have been steadily climbing in recent weeks as investors have begun to focus on the prospect of an eventual rebound from the economic collapse set off by the pandemic.Though still far from the record reached on Feb. 19, stocks in the United States have been steadily climbing in recent weeks as investors have begun to focus on the prospect of an eventual rebound from the economic collapse set off by the pandemic.
European carmakers are beginning to gradually reopen factories in what will be an important test of whether it is possible to get the economy going again without endangering the health of employees.European carmakers are beginning to gradually reopen factories in what will be an important test of whether it is possible to get the economy going again without endangering the health of employees.
Volkswagen, which has already restarted limited production at some parts factories, said Wednesday that it would reopen car assembly plants in Zwickau, Germany, and Bratislava, Slovakia, on Monday. Other VW factories around the world will follow later in April and in May.Volkswagen, which has already restarted limited production at some parts factories, said Wednesday that it would reopen car assembly plants in Zwickau, Germany, and Bratislava, Slovakia, on Monday. Other VW factories around the world will follow later in April and in May.
Daimler, the maker of Mercedes-Benz cars and trucks, said that next week it would reopen three German factories that manufacture vital parts, such as a system made in Berlin that controls the valves of internal combustion engines. The plants will initially operate for one shift a day as Daimler gradually restarts operations in Germany, the company said.Daimler, the maker of Mercedes-Benz cars and trucks, said that next week it would reopen three German factories that manufacture vital parts, such as a system made in Berlin that controls the valves of internal combustion engines. The plants will initially operate for one shift a day as Daimler gradually restarts operations in Germany, the company said.
Volvo Cars said it will reopen its factories and offices in Sweden on Monday. Sweden has taken a more relaxed approach to the virus, allowing grade schools and restaurants to remain open.Volvo Cars said it will reopen its factories and offices in Sweden on Monday. Sweden has taken a more relaxed approach to the virus, allowing grade schools and restaurants to remain open.
More than 1 million Europeans are either working reduced hours or unemployed because of car and parts factory shutdowns, so restarting the plants is crucial. But the factories will also be laboratories of whether the risk of infection can be controlled by use of face masks, plastic barriers, and other measures.More than 1 million Europeans are either working reduced hours or unemployed because of car and parts factory shutdowns, so restarting the plants is crucial. But the factories will also be laboratories of whether the risk of infection can be controlled by use of face masks, plastic barriers, and other measures.
As China’s economy struggles with the coronavirus outbreak, a famously debt-laden company illustrates the risks of the country’s addiction to borrowing.As China’s economy struggles with the coronavirus outbreak, a famously debt-laden company illustrates the risks of the country’s addiction to borrowing.
HNA, a conglomerate that borrowed heavily and then ran into difficulties in recent years, has blamed virus-related flight cancellations across China and the world for mounting debt woes that led it to ask the Chinese government for a bailout in February. This week, the airlines-to-insurance behemoth said that the pandemic had brought it to the “point of life and death.”HNA, a conglomerate that borrowed heavily and then ran into difficulties in recent years, has blamed virus-related flight cancellations across China and the world for mounting debt woes that led it to ask the Chinese government for a bailout in February. This week, the airlines-to-insurance behemoth said that the pandemic had brought it to the “point of life and death.”
In an apology letter to investors, HNA said that it would be forced to skip regular payments on one bond, delaying the interest and principal due by one year. The company also gave a glimpse into internal struggles by publishing an anonymous letter criticizing its own finance department for bungling a hastily arranged call to some of these investors.In an apology letter to investors, HNA said that it would be forced to skip regular payments on one bond, delaying the interest and principal due by one year. The company also gave a glimpse into internal struggles by publishing an anonymous letter criticizing its own finance department for bungling a hastily arranged call to some of these investors.
HNA said that not all investors were notified of the call. It promised to “disclose relevant information more openly and transparently” in the future.HNA said that not all investors were notified of the call. It promised to “disclose relevant information more openly and transparently” in the future.
For more than four decades, China has never acknowledged that its economy actually shrank, even during major economic crises. But that may change on Friday, when the country announces gross domestic product for the January-to-March quarter.For more than four decades, China has never acknowledged that its economy actually shrank, even during major economic crises. But that may change on Friday, when the country announces gross domestic product for the January-to-March quarter.
China’s National Bureau of Statistics already confirmed last month that domestic industrial production, retail sales and investment all suffered record, double-digit drops in the first two months of this year compared with the same period of 2019. That has prompted most, though not all, economists to guess that overall economic performance for the first quarter of this year will show a drop from a year earlier.China’s National Bureau of Statistics already confirmed last month that domestic industrial production, retail sales and investment all suffered record, double-digit drops in the first two months of this year compared with the same period of 2019. That has prompted most, though not all, economists to guess that overall economic performance for the first quarter of this year will show a drop from a year earlier.
The question is how big a drop it will be.The question is how big a drop it will be.
One survey of 18 Chinese and foreign institutions by Caixin, a Chinese news organization, found that they were forecasting that the economy was anywhere from flat to down 11.5 percent in the first quarter. The average forecast was for a drop of 6.6 percent.One survey of 18 Chinese and foreign institutions by Caixin, a Chinese news organization, found that they were forecasting that the economy was anywhere from flat to down 11.5 percent in the first quarter. The average forecast was for a drop of 6.6 percent.
A broader survey by Reuters of 57 analysts found an even wider range of predictions — anywhere from a nose-dive of 28.9 percent to a gain of 4 percent. But the average in the Reuters survey, a loss of 6.5 percent, was practically identical to Caixin’s.A broader survey by Reuters of 57 analysts found an even wider range of predictions — anywhere from a nose-dive of 28.9 percent to a gain of 4 percent. But the average in the Reuters survey, a loss of 6.5 percent, was practically identical to Caixin’s.
Foreign banks, which come under only slightly less political pressure than Chinese institutions to issue sunny forecasts, have tended to be at the bearish end of the range.Foreign banks, which come under only slightly less political pressure than Chinese institutions to issue sunny forecasts, have tended to be at the bearish end of the range.
The leaders of United Airlines issued a dire note to the carrier’s 100,000 employees on Wednesday, warning that staffing cuts may be coming and demand for air travel is likely to remain subdued into next year.The leaders of United Airlines issued a dire note to the carrier’s 100,000 employees on Wednesday, warning that staffing cuts may be coming and demand for air travel is likely to remain subdued into next year.
“The challenge that lies ahead for United is bigger than any we have faced in our proud 94-year history,” the airline’s chief executive, Oscar Munoz, and president, J. Scott Kirby, wrote in the letter, which was posted on the company’s website.“The challenge that lies ahead for United is bigger than any we have faced in our proud 94-year history,” the airline’s chief executive, Oscar Munoz, and president, J. Scott Kirby, wrote in the letter, which was posted on the company’s website.
Traffic in the first two weeks of April was down 97 percent from last year and the airline now expects to fly fewer passengers in all of May than it flew in a single day during the same month last year, the executives wrote. And that decline is expected to last even as health concerns linger and travel restrictions are lifted at different times around the world.Traffic in the first two weeks of April was down 97 percent from last year and the airline now expects to fly fewer passengers in all of May than it flew in a single day during the same month last year, the executives wrote. And that decline is expected to last even as health concerns linger and travel restrictions are lifted at different times around the world.
The airline said earlier on Wednesday that it expected to receive $5 billion of federal funding intended to pay airline workers through September, but that stimulus is unlikely to prevent cuts beyond that, the executives warned on Thursday.The airline said earlier on Wednesday that it expected to receive $5 billion of federal funding intended to pay airline workers through September, but that stimulus is unlikely to prevent cuts beyond that, the executives warned on Thursday.
“The challenging economic outlook means we have some tough decisions ahead as we plan for our airline, and our overall work force, to be smaller than it is today, starting as early as October 1,” they said.“The challenging economic outlook means we have some tough decisions ahead as we plan for our airline, and our overall work force, to be smaller than it is today, starting as early as October 1,” they said.
The leaders struck a markedly different tone from the chief executive of American Airlines, Doug Parker, who said in a CNBC interview earlier in the day that he saw some “indications that the world is ready to start traveling again.”The leaders struck a markedly different tone from the chief executive of American Airlines, Doug Parker, who said in a CNBC interview earlier in the day that he saw some “indications that the world is ready to start traveling again.”
A computer, communications tools, entertainment and a good internet connection are all the technology that most of us need to work and stay sane while stuck inside our homes, says our Tech Fix columnist, Brian X. Chen.A computer, communications tools, entertainment and a good internet connection are all the technology that most of us need to work and stay sane while stuck inside our homes, says our Tech Fix columnist, Brian X. Chen.
That means we don’t have to spend a lot of money on the latest devices, although investing in a new router can significantly boost the speed of your internet connection.That means we don’t have to spend a lot of money on the latest devices, although investing in a new router can significantly boost the speed of your internet connection.
This short list can guide our priorities in tech consumption even after we come out of this uncertain period. It also means that we don’t have to spend much money to maximize our happiness with tech.This short list can guide our priorities in tech consumption even after we come out of this uncertain period. It also means that we don’t have to spend much money to maximize our happiness with tech.
Tech you don’t need: That smart speaker from Amazon or Google or that phone with the foldable screen. If it doesn’t help you do work, stay connected and feel entertained, you can find other ways to spend your money.Tech you don’t need: That smart speaker from Amazon or Google or that phone with the foldable screen. If it doesn’t help you do work, stay connected and feel entertained, you can find other ways to spend your money.
Gov. Gavin Newsom of California signed an executive order Wednesday directing the state’s unemployment agency to pay benefits to workers like drivers for Uber and Lyft through a federal assistance program for the self-employed. He said the state would also extend aid to undocumented workers, many of whom have been unable to get federal relief during the pandemic despite paying local and state taxes.Gov. Gavin Newsom of California signed an executive order Wednesday directing the state’s unemployment agency to pay benefits to workers like drivers for Uber and Lyft through a federal assistance program for the self-employed. He said the state would also extend aid to undocumented workers, many of whom have been unable to get federal relief during the pandemic despite paying local and state taxes.
Amazon said Wednesday that it would temporarily halt its operations in France after a court ruled the company had failed to adequately protect warehouse workers against the threat of the coronavirus and that it must restrict deliveries to only food, hygiene and medical products until it addressed the issue.Amazon said Wednesday that it would temporarily halt its operations in France after a court ruled the company had failed to adequately protect warehouse workers against the threat of the coronavirus and that it must restrict deliveries to only food, hygiene and medical products until it addressed the issue.
UnitedHealth Group, one of the nation’s major insurers, reported that its earnings increased this past quarter, adding that the costs of the pandemic were offset by the cancellations of routine medical appointments and elective surgeries.UnitedHealth Group, one of the nation’s major insurers, reported that its earnings increased this past quarter, adding that the costs of the pandemic were offset by the cancellations of routine medical appointments and elective surgeries.
The Paycheck Protection Program, a federal program to help small businesses weather the pandemic, is in danger of running dry amid a disagreement between congressional leaders and the White House over how to replenish it.The Paycheck Protection Program, a federal program to help small businesses weather the pandemic, is in danger of running dry amid a disagreement between congressional leaders and the White House over how to replenish it.
A Smithfield Foods pork plant in South Dakota has at least 640 coronavirus cases and is now the biggest new, single-source Covid-19 hot spot in America.A Smithfield Foods pork plant in South Dakota has at least 640 coronavirus cases and is now the biggest new, single-source Covid-19 hot spot in America.
Reporting was contributed by Alexandra Stevenson, Neil Irwin, Nelson D. Schwartz, Liz Alderman, Keith Bradsher, Niraj Chokshi, Caitlin Dickerson, Miriam Jordan Jim Tankersley, Emily Cochrane and Emily Flitter Reed Abelson, Sapna Maheshwari, Ben Casselman, Noam Scheiber, Carlos Tejada and Mike Ives.Reporting was contributed by Alexandra Stevenson, Neil Irwin, Nelson D. Schwartz, Liz Alderman, Keith Bradsher, Niraj Chokshi, Caitlin Dickerson, Miriam Jordan Jim Tankersley, Emily Cochrane and Emily Flitter Reed Abelson, Sapna Maheshwari, Ben Casselman, Noam Scheiber, Carlos Tejada and Mike Ives.