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Stock Markets Rise on Hopes of Recovery: Live Updates Stock Markets Rise on Hopes of Recovery: Live Updates
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U.S. stock futures followed global markets and oil prices higher on Tuesday, as investors began to look for signs of optimism after a slew of discouraging financial results from major companies. Hertz, the century-old car rental company, narrowly averted an impending crisis Monday after successfully negotiating with its lenders over a missed payment on the lease for its rental fleet, according to a securities filing. The company now has less than three weeks — until May 22 — to come up with a plan to pay them back and continue to meet its ongoing financial obligations.
Futures for the S&P 500 were up about 1 percent, signaling an upbeat start to trading on Wall Street. European markets were more than 1 percent higher after a quiet day in Asia, where markets in Japan, China and South Korea closed for holidays. The company warned last week that it had missed the payment, but had a one-week grace period ending on Monday to pay or negotiate new terms with the lenders. According to the filing on Tuesday morning, the lenders agreed not to force a sale of the vehicles in the Hertz fleet — for now.
The gains followed a late rally on Wall Street on Monday, when rising shares of large technology companies overshadowed a broader global drop spurred in part by escalating tensions between the United States and China. Investors have been cheered by the potential for recovery efforts in the United States, as well as disclosures from places as far-flung as Europe, China and New Zealand that the worst may be over in some of the hardest-hit places. “There can be no assurances that Hertz will be able to successfully negotiate any further forbearance or waivers extending relief past May 22,” the company said in the filing.
Underscoring the optimism, oil prices surged in early Tuesday trading, though they remained at historically low levels. The price of benchmark crude in the United States was up more than 10 percent. Brent crude, the international benchmark, was up more than 7 percent. Hertz had been preparing to file for bankruptcy as soon as Tuesday if it could not reach an agreement with the lenders, according to Bloomberg. It had even hired a bankruptcy adviser to help it prepare, The Wall Street Journal reported.
The pandemic has had “a rapid, sudden and dramatic negative impact” on the company’s business, it said in the Tuesday filing. Hertz had begun selling some of the cars in its fleet as early as March as government restrictions and fear of the outbreak rapidly eroded its business. Last month, it laid off 10,000 workers.
Norwegian Cruise Line, one of the world’s largest cruise companies, said on Tuesday that there was “substantial doubt” about its ability to survive the coronavirus pandemic.
Norwegian acknowledged the dire situation in a securities filing announcing that it was seeking $650 million in new financing. The global shutdown of the cruise industry has strained the finances of all three major cruise companies — Norwegian and its two main rivals, Carnival Corporation and Royal Caribbean — forcing them to borrow money at high interest rates.
As the coronavirus continues to spread, Norwegian said in the filing, it is “expected to continue to adversely impact our results, operations, outlook, plans, goals, growth, reputation, cash flows, liquidity, demand for voyages and share price.”
Carnival said on Monday that it planned to begin cruising again on some of its ships as early as August. A spokeswoman for Norwegian said the company hoped to begin cruising in July.
Wall Street was upbeat on Tuesday as stocks in the United States followed global markets and oil prices higher.
The S&P 500 climbed about 1 percent in early trading, extending a rally that began late on Monday as shares of large technology companies rose.
Though unsteady at times, stocks have been climbing lately as investors see recovery efforts in the United States, as well as signs from Europe and China that the worst of the coronavirus pandemic may be over in some of the hardest-hit places.
Underscoring the optimism, oil prices surged in early Tuesday trading, though they remained close to historically low levels. The price of benchmark crude in the United States was up more than 10 percent. Brent crude, the international benchmark, was up more than 7 percent.
But the markets gains have proven susceptible to sudden downdrafts, as companies report discouraging financial results and warn of the economic damage being caused by the pandemic.
A jump in flu deaths early in the 20th century may have helped to drive the rise of the Nazi Party in Germany, research from the Federal Reserve Bank of New York showed, in a stark warning about how pandemics can drive societal change.
“Influenza deaths of 1918 are correlated with an increase in the share of votes won by right-wing extremists,” Kristian S. Blickle, a Fed economist, wrote in the report.
The study has limitations: Data on the period is somewhat sporadic, so the conclusions are based on a small sample, and disentangling disease repercussions and the after-effects of World War I are difficult.
But the finding holds even counting for a city’s ethnic and religious makeup, regional unemployment, past right-wing voting, and other local characteristics.
“The correlation between influenza mortality and the vote share won by right-wing extremists is stronger in regions that had historically blamed minorities, particularly Jews, for medieval plagues,” Mr. Blickle wrote. He adds that “the disease may have fostered a hatred of `others’, as it was perceived to come from abroad.”
Publicly traded companies have given back more than $375 million in federal stimulus loans meant to help small businesses stay afloat, according to a New York Times analysis of securities filings and public announcements. Many of the companies began returning the loans after their disclosures raised an outcry that the stimulus program was steering money to major corporations instead of smaller operations like independent retailers and restaurants.Publicly traded companies have given back more than $375 million in federal stimulus loans meant to help small businesses stay afloat, according to a New York Times analysis of securities filings and public announcements. Many of the companies began returning the loans after their disclosures raised an outcry that the stimulus program was steering money to major corporations instead of smaller operations like independent retailers and restaurants.
Nine of the 10 largest known loans issued to public companies have or will be returned, the Times analysis shows. The outlier, a loan to BBQ Holdings, which owns several hospitality brands including Famous Dave’s BBQ, was first disclosed on Friday.Nine of the 10 largest known loans issued to public companies have or will be returned, the Times analysis shows. The outlier, a loan to BBQ Holdings, which owns several hospitality brands including Famous Dave’s BBQ, was first disclosed on Friday.
Ashford Inc., which oversees a network of hotels and resorts including Ritz Carltons and one of the biggest beneficiaries of the program, said on Saturday that it and its subsidiaries would return $68.8 million in loans after mounting criticism from policymakers and members of the public. So far, at least 35 public and private companies have returned their loans.Ashford Inc., which oversees a network of hotels and resorts including Ritz Carltons and one of the biggest beneficiaries of the program, said on Saturday that it and its subsidiaries would return $68.8 million in loans after mounting criticism from policymakers and members of the public. So far, at least 35 public and private companies have returned their loans.
With the lending program under scrutiny, federal officials in late April began putting new policies in place to limit which public companies could receive the stimulus aid. Public companies with access to other capital are not likely to be eligible to receive loans, and companies that returned the money by May 7 would not face penalties.With the lending program under scrutiny, federal officials in late April began putting new policies in place to limit which public companies could receive the stimulus aid. Public companies with access to other capital are not likely to be eligible to receive loans, and companies that returned the money by May 7 would not face penalties.
Lobby groups for the European auto industry said Tuesday that governments should offer cash-for-clunkers programs and other financial incentives to restart car sales, which have plunged because of lockdowns.Lobby groups for the European auto industry said Tuesday that governments should offer cash-for-clunkers programs and other financial incentives to restart car sales, which have plunged because of lockdowns.
The appeal by associations representing carmakers, dealers, parts suppliers and tire makers came as chief executives of German auto manufacturers held a conference call with Chancellor Angela Merkel to discuss how to help the country’s most important industry.The appeal by associations representing carmakers, dealers, parts suppliers and tire makers came as chief executives of German auto manufacturers held a conference call with Chancellor Angela Merkel to discuss how to help the country’s most important industry.
Many economists argue that the incentive programs, which typically offer a bonus to people who trade in an older model, simply delay a day of reckoning for the industry and help mostly affluent people who have money for new cars.Many economists argue that the incentive programs, which typically offer a bonus to people who trade in an older model, simply delay a day of reckoning for the industry and help mostly affluent people who have money for new cars.
Environmental groups are pushing for any incentives to apply only to electric cars, but the industry groups said that gasoline and diesel vehicles — which typically generate more profit— should also be eligible. Environmental groups are pushing for any incentives to apply only to electric cars, but the industry groups said that gasoline and diesel vehicles — which typically generate more profit — should also be eligible.
Germany’s highest court issued a ruling on Tuesday that could disrupt a European Central Bank program that has helped to prevent the eurozone from collapsing.Germany’s highest court issued a ruling on Tuesday that could disrupt a European Central Bank program that has helped to prevent the eurozone from collapsing.
In a widely anticipated decision, the Federal Constitutional Court in Karlsruhe said that the central bank had failed to show that its purchases of government bonds, which in recent years helped keep borrowing costs for countries like Spain and Italy from spinning out of control, were justified under European Union law.In a widely anticipated decision, the Federal Constitutional Court in Karlsruhe said that the central bank had failed to show that its purchases of government bonds, which in recent years helped keep borrowing costs for countries like Spain and Italy from spinning out of control, were justified under European Union law.
The court said that the central bank was required to demonstrate that the side effects of the bond-buying program were not out of proportion to its purpose, which was to stimulate borrowing and raise inflation to the official target of 2 percent. Critics say that, by pushing down interest rates, the central bank has unfairly penalized retirees who earn hardly anything on their savings.The court said that the central bank was required to demonstrate that the side effects of the bond-buying program were not out of proportion to its purpose, which was to stimulate borrowing and raise inflation to the official target of 2 percent. Critics say that, by pushing down interest rates, the central bank has unfairly penalized retirees who earn hardly anything on their savings.
The court gave the central bank three months to justify the bond-buying program. Although the German court cannot tell the European Central Bank what to do, it threatened to prevent the Bundesbank, Germany’s central bank, from participating.The court gave the central bank three months to justify the bond-buying program. Although the German court cannot tell the European Central Bank what to do, it threatened to prevent the Bundesbank, Germany’s central bank, from participating.
A ban on Bundesbank participation would raise questions about European Union unity. It would also present practical problems for the European Central Bank, which has a relatively small staff and depends on the German central bank to execute a large proportion of the bond purchases.A ban on Bundesbank participation would raise questions about European Union unity. It would also present practical problems for the European Central Bank, which has a relatively small staff and depends on the German central bank to execute a large proportion of the bond purchases.
Prime Minister Shinzo Abe of Japan has pushed a homegrown drug as a potential global savior, but has glossed over a crucial fact: There is no solid evidence that it is effective against Covid-19.Prime Minister Shinzo Abe of Japan has pushed a homegrown drug as a potential global savior, but has glossed over a crucial fact: There is no solid evidence that it is effective against Covid-19.
Much like President Trump’s testimonials for hydroxychloroquine, Mr. Abe’s enthusiasm for the antiviral medicine known as Avigan comes despite limited findings that it is effective against Covid-19. And it carries dangerous potential side effects: birth defects similar to those caused by thalidomide. That drug, developed as a sedative and prescribed to pregnant women, caused deformities in thousands of babies in the 1950s and 60s.Much like President Trump’s testimonials for hydroxychloroquine, Mr. Abe’s enthusiasm for the antiviral medicine known as Avigan comes despite limited findings that it is effective against Covid-19. And it carries dangerous potential side effects: birth defects similar to those caused by thalidomide. That drug, developed as a sedative and prescribed to pregnant women, caused deformities in thousands of babies in the 1950s and 60s.
But Mr. Abe has allocated nearly $130 million to triple an existing stockpile of the medication, offered to provide it free to dozens of other countries, and called for it to be approved for use against Covid-19 by the end of the month. The drug was developed by a subsidiary of Fujifilm.But Mr. Abe has allocated nearly $130 million to triple an existing stockpile of the medication, offered to provide it free to dozens of other countries, and called for it to be approved for use against Covid-19 by the end of the month. The drug was developed by a subsidiary of Fujifilm.
On another front, Pfizer and the German pharmaceutical company BioNTech said that their potential coronavirus vaccine began human trials in the United States on Monday. If the tests are successful, the vaccine could be ready for emergency use as early as September.On another front, Pfizer and the German pharmaceutical company BioNTech said that their potential coronavirus vaccine began human trials in the United States on Monday. If the tests are successful, the vaccine could be ready for emergency use as early as September.
Pfizer, which is based in New York, and BioNTech injected the first human volunteers with their vaccine candidate, called BNT162, in Germany last month. In the United States, the drug companies plan to test the vaccine on 360 healthy volunteers for the first stage of the study, adding up to 8,000 volunteers by the end of the second stage.Pfizer, which is based in New York, and BioNTech injected the first human volunteers with their vaccine candidate, called BNT162, in Germany last month. In the United States, the drug companies plan to test the vaccine on 360 healthy volunteers for the first stage of the study, adding up to 8,000 volunteers by the end of the second stage.
Parking lots have been a digital lifeline during the pandemic, a patch for one of the most stubborn problems in technology — and one the coronavirus has exacerbated. Instead of spending hours in restaurants, libraries and cafes, people without fast internet access at home are sitting in lots near schools, libraries and stores that have kept their signals on.Parking lots have been a digital lifeline during the pandemic, a patch for one of the most stubborn problems in technology — and one the coronavirus has exacerbated. Instead of spending hours in restaurants, libraries and cafes, people without fast internet access at home are sitting in lots near schools, libraries and stores that have kept their signals on.
School leaders in Philadelphia and Sacramento have encouraged families to use free hot spots in library and school parking lots. More than 100 people logged on to the Wi-Fi of one of Omaha’s libraries over three days recently. Near Topeka, Kan., a steady flow of cars now arrive outside the public library, while other cars cluster near connected bookmobiles parked in lots near a women’s correctional facility and a mobile home park.School leaders in Philadelphia and Sacramento have encouraged families to use free hot spots in library and school parking lots. More than 100 people logged on to the Wi-Fi of one of Omaha’s libraries over three days recently. Near Topeka, Kan., a steady flow of cars now arrive outside the public library, while other cars cluster near connected bookmobiles parked in lots near a women’s correctional facility and a mobile home park.
“I hope that there is a lesson learned from this,” said Gina Millsap, the chief executive of the Topeka & Shawnee County Public Library. “Broadband is like water and electricity now, and yet it’s still being treated like a luxury.”“I hope that there is a lesson learned from this,” said Gina Millsap, the chief executive of the Topeka & Shawnee County Public Library. “Broadband is like water and electricity now, and yet it’s still being treated like a luxury.”
Mary Anne Mendoza, 26, a doctoral student at the University of California, Irvine, shares the least expensive internet service available with her mother and sister in their two-bedroom apartment near the college. When her mother, an M.B.A. candidate, is on a videoconference call, and her sister is online for an undergraduate class, the Wi-Fi at home slows to a crawl.Mary Anne Mendoza, 26, a doctoral student at the University of California, Irvine, shares the least expensive internet service available with her mother and sister in their two-bedroom apartment near the college. When her mother, an M.B.A. candidate, is on a videoconference call, and her sister is online for an undergraduate class, the Wi-Fi at home slows to a crawl.
As a result, Ms. Mendoza, who also teaches political science at California State Polytechnic University, Pomona, has been driving to the parking lot of a nearby Starbucks to get online.As a result, Ms. Mendoza, who also teaches political science at California State Polytechnic University, Pomona, has been driving to the parking lot of a nearby Starbucks to get online.
“In my car, I get the privacy I need, and the quality of service is better,” she said.“In my car, I get the privacy I need, and the quality of service is better,” she said.
One in four Americans has no high-speed internet access at home, according to the Pew Research Center, either because it’s too expensive or because the home is in a rural area with limited service. Some use their smartphone data plans for high-speed internet access, but those plans are often insufficient to handle work from home and distance learning. That makes it harder for many people to work from home during the health crisis and for their children to keep up with their schoolwork away from the classroom. One in four Americans has no high-speed internet access at home, according to the Pew Research Center, either because it’s too expensive or because the home is in a rural area with limited service. Some use their smartphone data plans for high-speed internet access, but those plans are often insufficient to handle work from home and distance learning.
The modern corporate office is renowned for open, collaborative work spaces, in-house coffee bars and standing desks with room for two giant computer monitors.The modern corporate office is renowned for open, collaborative work spaces, in-house coffee bars and standing desks with room for two giant computer monitors.
Soon, there may be a new must-have perk: the sneeze guard.Soon, there may be a new must-have perk: the sneeze guard.
This plexiglass barrier that can be mounted on a desk is one of many ideas being mulled by employers as they contemplate a return to the workplace after coronavirus lockdowns.This plexiglass barrier that can be mounted on a desk is one of many ideas being mulled by employers as they contemplate a return to the workplace after coronavirus lockdowns.
Their post-pandemic makeovers may include hand sanitizers built into desks that are positioned at 90-degree angles or that are enclosed by translucent plastic partitions; air filters that push air down and not up; outdoor gathering space to allow collaboration without viral transmission; and windows that actually open, for freer air flow.Their post-pandemic makeovers may include hand sanitizers built into desks that are positioned at 90-degree angles or that are enclosed by translucent plastic partitions; air filters that push air down and not up; outdoor gathering space to allow collaboration without viral transmission; and windows that actually open, for freer air flow.
The question is whether any of the changes being contemplated will actually result in safer workplaces.The question is whether any of the changes being contemplated will actually result in safer workplaces.
Lawrence H. Summers, the former Treasury secretary, said Monday that the government’s work was far from done in keeping the U.S. economy from slipping into a disaster zone.
Mr. Summers, speaking on a webinar hosted by the Economic Club of New York, called for an ambitious program of federal public works, expanded wage supplements and grants to states and local governments — along with an aggressive public health campaign to extend coronavirus testing and tracing and develop drugs and vaccines.
Although he warned against oversize deficits during the 2008 financial crisis and recession, Mr. Summers said he was much more concerned about doing too little in this crisis than about doing too much.
Mr. Summers, who was Treasury secretary in the Clinton administration and head of the National Economic Council under President Barack Obama, is now advising the presidential campaign of Joseph R. Biden Jr., the presumptive Democratic nominee.
L Brands will no longer sell Victoria’s Secret to Sycamore Partners, a private equity investor. The firms said on Monday that they had reached a mutual agreement to terminate the deal. The announcement came after L Brands and Sycamore sparred in court about moving forward with the transaction based on Victoria’s Secret’s response to the coronavirus outbreak.
Sycamore had agreed to buy a majority of Victoria’s Secret from the embattled L Brands in February for $525 million in a deal that was expected to close this spring. Bath & Body Works, which is also owned by L Brands, would become a stand-alone public company. But Sycamore tried to back out of the agreement as the pandemic forced Victoria’s Secret, and much of the retail industry, to temporarily close stores and furlough staff.
L Brands said on Monday that it planned to move forward with establishing Bath & Body Works and Victoria’s Secret as two separate companies. Leslie H. Wexner, the chief executive of L Brands, will still step down from his roles as the company’s chief executive and chairman. L Brands’ board appointed Stuart Burgdoerfer, the chief financial officer of L Brands, to become the brand’s interim chief executive, effective immediately.
Fiat Chrysler reported an adjusted net loss of 471 million euros ($510 million) for the first quarter, compared to a profit of 570 million euros a year ago, as it was forced to shut down production to curb the spread of coronavirus. The company said its plants in China and Italy had reopened, and that most plants in North America would be restarted the week of May 18.Fiat Chrysler reported an adjusted net loss of 471 million euros ($510 million) for the first quarter, compared to a profit of 570 million euros a year ago, as it was forced to shut down production to curb the spread of coronavirus. The company said its plants in China and Italy had reopened, and that most plants in North America would be restarted the week of May 18.
Costco, the club retailer, has started to limit the amount of meat customers can buy at once. The company said in an update on its website on Monday that fresh beef, pork and poultry products would be “temporarily limited to 3 items” per member. The limits come as production in the meat industry slows after widespread illnesses in slaughterhouses across the Midwest and South.Costco, the club retailer, has started to limit the amount of meat customers can buy at once. The company said in an update on its website on Monday that fresh beef, pork and poultry products would be “temporarily limited to 3 items” per member. The limits come as production in the meat industry slows after widespread illnesses in slaughterhouses across the Midwest and South.
Reporting was contributed by Jack Ewing, Ben Dooley, Knvul Sheikh, Mohammed Hadi, Sapna Maheshwari, Ivan Penn, Matt Richtel, Carlos Tejada, Daniel Victor, Katie Robertson and Kevin Granville. Reporting was contributed by David Yaffe-Bellany, Niraj Chokshi, Jack Ewing, Jeanna Smialek, Ben Dooley, Knvul Sheikh, Mohammed Hadi, Sapna Maheshwari, Ivan Penn, Matt Richtel, Carlos Tejada, Daniel Victor, Katie Robertson and Kevin Granville.