The stock market powered ahead Wednesday amid more concrete steps to bring America out of the great shut in. The Dow settled above the 25,000 mark for the first time since early March. It was the S&P 500's first close above the key 3,000 level since March 5th. And the Nasdaq turned it around late in the day to also finish higher. Plans for recreational re-openings are fueling optimism about an economic comeback... But the real catalyst for the market's recent rebound are the pledges by global central banks to do whatever it takes to prop up their economies, says Spartan Capital Securities chief market economist Peter Cardillo. "The European Union proposed a $821 billion stimulus package which would be a unifying bond by the way and of course the Japanese are preparing to stimulate with massive amounts of money, and of course here in the States, and that's the reason why we have a stock market that's defying the fundamentals at this time." Investors, however believe the prospects for the economy are improving.... The Las Vegas strip has been given the green light by Nevada's governor to reopen next week... And Walt Disney announced plans to re-open Florida's Disney World in July... With states relaxing shelter-in-place orders, investors bet there is pent up consumer demand for shopping. Shares of retailers closed during the shutdown rallied the most. Macy's jumped nearly 20 percent in one day. Gap Inc. was up more than 18 percent. And banks were another major force in Wednesday rally. Wall Street is betting the group will benefit from a pickup in economic activity. Citigroup led the pack with an 8-1/2 percent surge on Wednesday, Bank of America and Morgan Stanley were up 7 percent.
U.S. Secretary of State Mike Pompeo declared on Wednesday that Hong Kong was no longer autonomous from China, a potentially huge blow to the territory's status as a major financial hub, as the Trump administration weighs suspending Hong Kong's preferential trade relationship with the United States. Pompeo's certification to Congress follows China's announcement of a plan to impose new national security legislation on Hong Kong, which has revived anti-government protests. Police fired pepper pellets and made 360 arrests on Wednesday, as thousands of people took to the streets in anger over the legislation. The national security law is meant to tackle secession, subversion and terrorism after major unrest last year. It also criminalizes disrespect of the Chinese National anthem. Pompeo said it was "only the latest in a series of actions [by China] that fundamentally undermine Hong Kong’s autonomy and freedoms." It now falls to President Donald Trump to decide whether to end some, all, or none of the U.S. economic privileges which Hong Kong enjoys now. Trump, who is already at odds with China over trade and the coronavirus pandemic, said earlier this week that his administration was working on a strong response to China's national security law, which Beijing is expected to approve on Thursday.
As companies all over the world grapple with how best to bring their employees back as lockdown measures ease... one textile company in Colombia is taking a novel approach: offering employees to live at work. The Hechizoo factory in capital Bogota, makers of high-end upholstery, has installed small, studio apartments. The goal: to cut back on the risk of employees picking up the coronavirus as they commute to and from work...and then spreading it to others. Seamstress Nazly Penagos, was starting to go stir crazy at home when she got the call from her boss who gave her the option to move in. She says she has a little girl at home, and the last thing she wants is to get her kid sick from a potential exposure during her commute. "It was cool to be called back to work because I said, 'I am going to work!' I was at home, desperate because every day it was the same thing - they called me from the workshop and I said, 'I'm ready, yes!'" The company has installed bathrooms, a kitchen and beds to house eight of the 17 employees who have returned to work. While installing living quarters is rare, sectors like construction, manufacturing and some retail have been allowed to gradually reopen by the government of President Ivan Duque, with limits on the numbers of employees. Businesses told Reuters government authorizations to restart work have come slowly amid contradictory official announcements and fears customers will purchase little while they remain largely stuck at home and restricted to buying basics. Creative Director Jorge Lizarazo says the idea was born out of necessity … and uncertainty about the virus that still has no cure. "We decided to stay here permanently until we know what is going to happen." Like so many others, not knowing what the future holds is wearing on him. "It is the uncertainty that bothers me and the uncertainty for any company is fatal, not having the security of knowing what human resources I am going to have, what resources, what you order, what clients, that is what this virus has done. This virus, beyond infecting us with this terrible disease, has also infected our spirit, a little bit of not knowing where we are going, of not being certain where this world is going. " Colombia's gradual reopening is similar to those taking place in Mexico, Argentina, Peru and Chile. Around 1.6 million Colombians lost their jobs in March and the country's economy - usually one of the region's healthiest - is struggling, but companies like Hechizoo are hoping to give some impacted employees one less thing to keep them up at night …
"Pass a piece of legislation that is honorable and decent and does the right thing for all Americans. Why is that so hard?," Cuomo told a briefing in Washington following his meeting with U.S. President Donald Trump. The House of Representatives, which is controlled by the Democrats, passed legislation legislation on May 15 that would provide nearly $1 trillion for state and local governments, but the bill was rejected by Trump and the Republican-led Senate's leaders. Republican Senate Majority Leader Mitch McConnell last month suggested that states whose finances are depleted by the coronavirus pandemic could declare bankruptcy instead of receiving federal aid. The suggestion sparked outrage from some state leaders.
UK Prime Minister Boris Johnson delivered the simple message for the British people to just “move on” from the row over the actions of his closest government aide Dominic Cummings. Some still want answers over why Cummings deemed it right to drive his family 250 miles to self-isolate during the Uk’s lockdown and consequently keep his job. The Prime Minister continued to repeatedly back his adviser when answering questions from members of the UK parliament on Wednesday (May 27) and he would not be pursuing further enquiry. “it would not be doing my job if I were now to shuffle this problem into the hands of officials” “I totally understand public indignation, I totally understand that. But I do think that as I understand things, I've said, what I've said about the whole business, I think it would be much better if we could now move on and get focussed on the next steps." "I, of course, am deeply sorry for all the hurt and pain and anxiety that people have been going through throughout this period. This country has been going through, frankly, most difficult time. We're asking people to do quite exceptionally tough things, separating them from their families.” The questioning on Dominic Cummings overshadowed the announcement of a test and trace service the UK government is rolling out from Thursday across England to help the loosening of lockdown measures.
Announcing the creation of the WHO Foundation at a virtual briefing, WHO Director-General Tedros Adhanom Ghebreyesus denied the move was related to "recent funding issues," saying it had been in the works for years. President Donald Trump has threatened to halt funding from the United States, the WHO's biggest donor, after criticizing its handling of the pandemic and accusing it of being China-centric. In a letter to Tedros last week, Trump called on the U.N. agency to initiate reforms within 30 days. Tedros told a news conference the body had warned "many times" about a pandemic in recent years. Countries had identified gaps in their preparedness for fighting pandemics, but financing had not materialized, he said. The WHO Foundation is being created as an independent grant-making entity that will support the U.N. agency's efforts to address the most pressing global health challenges by raising new funding from "non-traditional sources."
There’s a wanted ad out there in Hollywood… for a new type of consultant who will work to keep busy film and TV sets healthy. With producers itching to get back to business after sets were shut down in mid-March - epidemiologists and other public health specialists are in high demand to offer safe solutions. It’s a tough job. Actress Anna Kendrick says she hasn’t seen a great solution yet. "There's been a lot of talk about how to get back to work on sets safely and, you know, some ideas that have been floated that I've sort of seen floating around like, I'm like, oh, this was written by somebody who's never been on a film set." While sets remain empty in the U.S. - countries like Australia are ramping up production. Melbourne’s set for the TV show ‘Neighbours’ has a bunch of sanitizing supplies, with socially distanced crew members wearing gloves. But actor-director Clark Duke doesn’t think social distancing will work very well: "I don't know - I don't think social distancing - I mean, anybody that's ever been on set, there's no distance. You can do it on like probably a news set, you know, or something that's like a studio show like that. But, I mean, as far as a movie or a TV show, I don't see how you could do it.” Writer-director Tyler Perry says he has found a way. Perry recently announced plans to begin shooting two BET television series on July 8 at his studio complex in Atlanta, offering housing where people can be isolated. In a 31-page outline, Perry said “it took a village of staff” - like doctors, epidemiologists and union reps - to develop the safeguards. But will the safety measures last? Medical Expert, Dr. Paul Litchfeld isn’t so sure: “…But I think as the threat begins to recede, then we'll go back to more like it was six months ago." No matter the challenge - restarting production is important to companies like Netflix and Disney, which need fresh shows to keep ‘stay at home’ audiences engaged.
The European Union unveiled a 750 billion euro recovery package on Wednesday (May 27). Every member state will get grants and loans to help them bounce back from this year's economic downturn. Another aim is to protect the EU's single market from being split by varying economic growth and wealth levels. That as the bloc is expected to emerge from its deepest-ever recession this year. EU Commission President Ursula Von der Leyen. "The Commission is today proposing a new recovery instrument called 'Next Generation EU' worth 750 billion euros. It will sit on top of our revamped long-term EU budget of 1.1 trillion (euros)." Two-thirds of the 750 billion euros would be in grants financed by joint borrowing and one-third in loans. But the grants are controversial. States including Denmark and Austria would rather see low-interest loans paid out to lower-income countries. The Commission says grants are better because Italy, Spain, Greece, France and Portugal already have high debts, and are heavily reliant on tourism that was brought to a halt the pandemic. They will find it harder than more frugal northern nations to restart their economies through borrowing. "These grants are a joint investment in our future. They have nothing to do with the debts of the member states in the past. The grants go through the European budget and the budget limits the payment of each country according to a fixed scale. All 27 EU member states must support the package for it to go through. Big-hitters France and Germany both back the plan.
Europe’s luxury stores are slowly coming back to life. When the doors first opened, many saw a surge of business. But with tourists missing, that soon wore off. Europe’s luxury retailers depend on travellers for up to 55% of their sales. Right now though, the big spenders from China, the Middle East and the U.S. are staying home. This week Milan’s upscale city-centre arcade looked quiet. The country’s business lobby said retailers there saw sales down 30% on the year since reopening on May 18. Paris seems a little more lively. Stores there have been open for two weeks. But this week still saw lines of shoppers outside upmarket brands like Louis Vuitton. Even so, consultancy Bain says global sales of high-end bags, clothing and jewellery will fall as much as 60% in the second quarter. Brands are adopting different strategies in response. Ferragamo and Burberry have written down the value of stock they can no longer sell at full price. But others like Chanel and Louis Vuitton have raised prices to protect margins. Gucci will go from five fashion shows a year, to just two, and wants garments to stay in stores longer. None of that may move European consumers. The European Commission estimates that households there will save almost a fifth of their income this year. Conspicuous consumption, is off the agenda.
More Americans are resuming their search to buy homes as states reopen. The Mortgage Bankers Association reported Wednesday that purchase applications shot up 8.6% from a week earlier despite high unemployment. That's the sixth straight weekly increase and amounts to a 54% jump since early April. That suggests the housing market could lead the economy's recovery. The sustained gains in applications also suggest the jump in first-time home buyers in April was no fluke. What's more, homebuilder sentiment improved in May. The housing market has a huge impact on the economy. It has a multiplier effect on other industries ranging from building materials to white goods and furniture. Rising demand for home loans amid low interest rates offers hope the economic slump is close to bottoming.
ABC News Chief Business Correspondent Rebecca Jarvis breaks down why retailers are declaring bankruptcy and how it could be their saving grace.
Tesla is slashing prices to rev up demand that's been hammered as people stay at home. The luxury electric vehicle maker chopped prices in North America as much as 6%. Its shaving $5,000 off its Model X SUVs and Model S sedans, which will now retail for just under $80,000 and $75,000 respectively. The lower-priced Model 3 sedan is now $2,000 cheaper, at just under $38,000. Tesla also said it'll cut prices in China by around 4% for the Models X and S. Other automakers like GM, Ford and Fiat Chrysler, are offering 0% financing and deferred payment options in a bid to lure buyers after auto sales hit the brakes. Analytics firm J.D. Power predicts retail sales of autos in the U.S. were likely halved in April from a year earlier. But it says sales are likely to improve in May due to incentives and pent-up demand. Car plants in the U.S. have begun to reopen this month. Tesla resumed production at its California factory after resolving a dispute over safety measures with local authorities.
Hong Kong riot police fired pepper pellets to disperse protesters in the city's central financial district Wednesday (May 27). Hundreds of protesters had taken to the streets and shopping malls as city's legislature debated a bill that criminalizes disrepect of the Chinese National anthem. Protesters see as a move by Beijing to strip away the city's freedoms. The bill carries penalties of up to three years in jail and/or fines of up to $6,500. People of all ages turned out; some dressed in black, some wearing office clothes, and others hiding their identities under umbrellas. Pro-democracy politician Kalvin Ho was at the protest: "After returning to China for more than 20 years, we didn't have any progress in this stage. But alternatively we can see the CCP is trying to suppress all people, the Hong Kong people, in a more serious manner." Last week, Beijing also proposed new national security laws which also helped fan the flames of Hong Kong's new protests. The law aims to prevent and punish subversion, separatism, terrorism or foreign interferenceand could see Chinese intelligence agencies set up in Hong Kong. It triggered the largest protests in months on Sunday (May 24). That event also saw mass arrests. At Wednesday's protest dozens of people were seen rounded up by riot police and made to sit on the sidewalk, before being searched, while officer workers on their lunchbreak looked on. The protests are reminiscent of the unrest that shook the city throughout last year. The security laws could be passed in a matter of days by China's governing National People's Congress. The laws have been widely criticised around the globe. When U.S. President Donald Trump was asked if they will impose sanctions on China, he said: "It's something you're going to be hearing about ... before the end of the week - very powerfully I think." China's foreign ministry then hit back hours later Wednesday saying it will take necessary countermeasures to any foreign interference.
South America's largest carrier filed for U.S. bankruptcy protection on Tuesday (May 26). The move by LATAM Airlines comes just weeks after Colombia's Avianca went bust. But while Avianca had undergone management turmoil and losses, Chile's LATAM had posted profits for the last four years of more than $700 million. LATAM CEO Roberto Alvo tried to reassure stockholders. "I want to be clear. Chapter 11 is not about liquidation, bankruptcy or insolvency. On the contrary, it is an opportunity to reorganize debt and consequently to preserve the LATAM Group, as well as the workers and collaborators, as much as possible. If we have chosen to take this decision, it is because we are committed to continue flying." Latin American governments have been reluctant to bail out their airlines - a sharp contrast to the help provided by European and U.S. authorities to their carriers. Chile's Economy Minister Lucas Palacios said on Tuesday he would not rule out a bailout, but also didn't propose one. In the lead-up to the bankruptcy filing, LATAM laid off 1,800 employees. The carrier said it raised up to $900 million from major shareholders to support operations through its bankruptcy reorganization. LATAM also said it has $1.3 billion in cash on hand.
Californians looking to get a haircut will have to abide by some new rules. Governor Gavin Newsom said on Tuesday (May 26) barbers could reopen for business in parts of the state -- with some new guidelines in place. But he joked that his own kids -- didn't seem to respect those rules. "It was actually a collection of barbers, a six year old, an eight year old and a 10 year old barber that we're not practicing physical distancing, that were not considering the deep sanitation requirements, wearing face coverings, nor was there subject. And I say subject because they had at me, it was a family effort to remove what was described by my wife as, forgive me, a mullet." Hair salon employees in 47 of California's 58 counties will be required to wear face masks and encouraged to don goggles. Customers must also wear face masks, use hand sanitizer and follow social distancing guidelines. Reopening barbershops is California's latest step to lift stay-at-home measures over the most populated U.S. state. On Monday authorities there allowed churches to reopen -- at a quarter capacity.
RESENDING WITH COMPLETE SCRIPT VIDEO SHOWS: VIDEO STATEMENT BY GERMAN DRIVER DANIEL ABT SHOWS: UNKNOWN LOCATION, GERMANY (MAY 26, 2020) (YOUTUBE/DANIEL ABT - NO RESALES/ MUST ON-SCREEN COURTESY 'YOUTUBE/DANIEL ABT') 1. (SOUNDBITE) (German) GERMAN DRIVER, DANIEL ABT, SAYING: "It was also very important to me, to say, that it was never my intention to let another drive for me to get a result and keep quiet about it later on just to make me look better. Because I do not. These points, this result, is irrelevant to me, personally. It has no impacts in any way. I'm not getting any money for it. Nothing of the sort. Today I was informed in a conversation with Audi that our ways will split from now on. We won't be racing together in Formula E anymore and the cooperation has ended. It is a pain which I have never felt in this way in my life. It was extremely important to me to take the chance here and now to tell you how it was and what happened and to simultaneously apologise to my family, to my friends, to Audi, to my partners, to Formula E, to UNICEF, and of course to all fans who have supported me over the years with all of my heart." 2. WHITE FLASH 3. (SOUNDBITE) (German) GERMAN DRIVER, DANIEL ABT, SAYING: "It was also very important to me, to say, that it was never my intention to let another driver for me to get a result and keep quiet about it later on just to make me look better. Because I do not. These points, this result, is irrelevant to me, personally. It has no impacts in any way. I'm not getting any money for it. Nothing of the sort." 4. WHITE FLASH 5. (SOUNDBITE) (German) GERMAN DRIVER, DANIEL ABT, SAYING: "In the end there is only this to say. You make mistakes in life. I feel like I couldn't fall any deeper. I'm on the ground but I'll get up again. I will come back. I surely need some time for myself right now, to reflect on things, to think about my future. But I believe that it will always continue and there will always be a way. I would, of course, be extremely happy if you accepted my apology, supported me on my way in the future again and we will see each other again, soon." STORY: Daniel Abt parted company with the Audi Formula E team on Tuesday (May 26) after letting a professional gamer impersonate him in an official esports race. The manufacturer had earlier suspended the German driver after the weekend cheating controversy. "Today I was informed in a conversation with Audi that our ways will split from now on, we won't be racing together in Formula E any more and the cooperation has ended," he said in a 15-minute video on YouTube. The 27-year-old denied seeking any sporting gain in Saturday's fifth round of the all-electric series' virtual 'Race at Home Challenge' and said he had simply wanted "to create a funny story for the fans". He said what happened had been openly discussed beforehand on his Twitch live stream in front of 1,000 followers and no money had changed hands. "Looking back, we did not think enough about the seriousness and the consequences of the situation. We made a huge mistake there," said Abt, who has paid 10,000 euros ($10,956) to charity. "It was never my intention to let another driver drive for me to get a result and keep quiet about it later on just to make me look better." Audi said in an earlier statement that "integrity, transparency and consistent compliance with applicable rules" were top priorities. "This applies to all activities the brand is involved in without exception," added the carmaker. The punishment, for something that happened in an online series designed to provide entertainment in the absence of real racing due to the COVID-19 pandemic, was seen as an over-reaction by some of Abt's track rivals. Formula E's championship leader Antonio Felix da Costa feared the sport was losing sight of what mattered. "Do we accept cheating? No, but who never cheated at Monopoly?" said the Portuguese on Twitter, before asking people to put things in perspective. DS Techeetah team mate and double Formula E champion Jean-Eric Vergne said on his feed: "After all this (is) a game that should be taken seriously, but it's a GAME." Abt, Audi's first Formula E race winner, apparently finished third in Saturday's race on the virtual Berlin Tempelhof layout but rivals expressed doubts at the time about who was racing. Mercedes driver Stoffel Vandoorne, who finished second, felt something was amiss and tried to call Abt on his mobile without success. The esports series features all of the regular Formula E drivers competing from home and visible in their simulators online, but Abt's face was hidden. Organisers can check the IP addresses of competitors to ensure they are who they purport to be, with pro gamer Lorenz Hoerzing later revealed to be Abt's 'ringer' and barred from future involvement. "I feel like I couldn't fall any deeper," said Abt, apologising again. "I'm on the ground but I will get up again. I will come back." (Production: Peter Bullock)
A stock market surge Tuesday welcomed traders back to the iconic floor of the New York Stock Exchange, which had been shut down since March as a health precaution. The Dow jumped more than 500 points. The S&P 500 briefly touched above 3,000 for the first time since March. The Nasdaq continued its upswing. Wall Street's euphoria, however, has Multivariate economist and market watcher Max Wolff - feeling puzzled. "Having a constant sort of drumbeat of good news - kind of - out of the world of coronavirus is great - unless you look close. If you look close we are unfortunately setting global records for new cases. If you look close we've lost 100,000 of our fellow citizens' lives and 41 million of there jobs. And the problem with things like that is when the tide goes out you can kind of see what the destruction is here." That said, just look to Merck for the bulk of Tuesday's optimism. The drug maker is jumping into the COVID19 vaccine race with both feet.. It bought an Austrian vaccine maker, announced a collaboration with a research non-profit to develop two separate vaccines and a partnership to develop an experimental oral anti-viral drug with privately held Ridgeback Biotherapeutics all in one day. The drug giant expects to start vaccinating volunteers "within weeks." The aggressive stance was welcomed by investors who pushed the stock higher. Economic reports were also encouraging. Consumer confidence crept higher in May. This could be the first sign consumer moods are stabilizing as states begin to reopen. And new home sales unexpectedly rose last month. Sales on the low end, priced below the $200,000 mark, made up nearly half of all purchases.
(BRIDENSTINE) “As of right now, we are a go for launch.” NASA administrator Jim Bridenstine says the weather, so far, is cooperating for SpaceX’s historic launch to the International Space Station on Wednesday. That’s when two American astronauts are set to blast off from NASA’s Kennedy Space Center - ending the U.S. space agency’s nine-year hiatus in human spaceflight and the first manned flight by a private company. Astronauts Doug Hurley and Bob Behnken will be launched into space from Elon Musk’s SpaceX Crew Dragon capsule… An event that Bridenstine says is transforming how NASA operate. "We're transforming how we do spaceflight in general. The commercial crew program is in fact about commercializing lower earth orbit. We've got resupply, now we're going to have crew, soon we are going to have commercial space stations.” For NASA, SpaceX and its founder, Elon Musk - a safe flight would mark a milestone in business-led space travel. NASA, which is hoping to stimulate a commercial space marketplace, recently awarded $3.1 billion to SpaceX and $4.5 billion to Boeing to develop dueling space capsules. Then NASA plans buy astronaut seats from the two companies. (BRIDENSTINE) "NASA will be a customer, we will always, always always be a customer…"(flash) "It’s how we are going to get to the moon and onto Mars. If we keep developing, using American taxpayer dollars, to develop capabilities in lower earth orbit, we’ll never get to the moon and onto Mars. That’s what this program is all about. It’s about commercialization…” SpaceX successfully tested Crew Dragon without astronauts last year in its first orbital mission to the space station. That vehicle was destroyed the following month during a ground test when one of the valves for its abort system burst, causing an explosion that triggered a nine-month engineering investigation that ended in January. President Donald Trump and Vice President Mike Pence plan to attend Wednesday’s launch. But NASA says no matter who is watching - it reserves the right to cancel the launch at the last minute if conditions are deemed unsafe.
(Governor Andrew Cuomo) "Stock market opened today...we want that economy to come roaring back." The famed New York Stock Exchange was back in business Tuesday after the iconic trading floor had been shut down since March 23. New York Governor Andrew Cuomo rang the opening bell to mark the partial reopening, bringing back the NYSE's practice of inviting a special guest to kick off the trading day ....of course with one notable difference - he was wearing a mask. The governor wasn't the only one. All those returning to the iconic NYSE will have to wear face coverings and practice social distancing, which means only a quarter of the people normally on the trading floor will return - for now. Later at his daily press briefing - held Tuesday at the NYSE, Cuomo highlighted the reopening as a blueprint for other businesses looking to hit the restart button. "It didn't reopen the way it was. It reopened smarter than it was before...fewer people, wearing masks, new precautions that the Stock Exchange has incorporate not because government said they had to but because the Stock Exchange is smart and they wanted to get back to business but they wanted to be smart and they are doing it in a way that's keeping people safe and that's an example of what we've been talking about." Other safeguard measures the NYSE is taking: All those returning to work have agreed to avoid the use of public transportation and they will be screened for signs of the virus before entering building. And there's one more thing: all have to sign a legal waiver freeing the NYSE for any liability if they get the virus at work. Getting the NYSE, long seen around the world as the most visible sign of American capitalism, up and running is being welcomed by many hoping the economy will only get better from here. A lot of that optimism - is showing up in the market - with stocks trading at their best levels since March.
Warner Music is back in the groove. The world's third largest recording label said Tuesday it's reviving its IPO with plans to go public June 3 under the ticker "WMG." It's setting a price target of $23-26 a share, valuing the company as high as $13.3 billion. The home to recording artists like Cardi B, Ed Sheeran and Bruno Mars aims to sell up to $1.8 billion in stock, making it potentially the largest initial public offering in New York so far this year. Warner was supposed make its public debut on the Nasdaq back in March, but it put off the IPO as the stock market tanked. The music industry is seen as more resilient to economic weakness, but Warner Music has posted a loss in its latest quarter and has expressed caution about its sources of revenue.