This briefing is no longer updating. Read the latest developments in the coronavirus outbreak here. Stocks soared on Tuesday on expectations that Congress was close to producing a stimulus bill to stabilize America’s faltering economy and offer lifelines to industries on the brink of collapse because of the coronavirus. A plan to bail out companies and send checks of up to $1,200 to Americans had been stalled since Sunday over objections by Democrats.
But on Tuesday, top Democrats and Trump administration officials said they were optimistic about finalizing an agreement on a roughly $2 trillion plan. The S&P 500 had its biggest daily gain since 2008, rising more than 9 percent. Stocks in Europe climbed, led by Germany, where stocks rose more than 10 percent. It wasn’t clear whether the rally would continue into Wednesday.
Stocks in Asia rose in early trading, with Tokyo and Seoul shares up more than 4 percent, but futures markets predicted a lower opening for Wall Street. Shares of hard-hit industries likely to receive aid, such as casinos and cruise lines, soared on Tuesday. Norwegian Cruise Lines was the best performing stock in the S&P 500 on Tuesday,jumping more than 40 percent, and MGM Resorts rose more than 30 percent. Airlines climbed, with American Airlines rising nearly 30 percent.
Delta, United Airlines and Boeing were all up more than 20 percent. The gains came even as investors were presented with more evidence of the economic toll of the outbreak. Companies, from General Motors to the Boeing supplier Spirit AeroSystems, detailed the impact of production shutdowns on their business, and new survey of activity in Europe showed a plunge in business across the region. Also on Tuesday, Japan said the Summer Olympics in Tokyo would be postponed for a year — a blow to broadcasters and advertisers who bet big on the viewership of the games — and India said it would impose a three-week lockdown.
The jump on Tuesday was in part a rebound from a difficult stretch for stock investors. On Monday, the S&P 500 fell about 3 percent as Congress struggled to overcome differences on the aid bill and traders remained cautious about the Federal Reserve’s ability to cushion the economy’s fall. Stocks are down almost 30 percent since their peak in February. After a month of mind-bending turns in the market, investors are still fragile and could sour on stocks if the promised deal hits a snag again, or as further evidence of the economic damage caused by containment efforts becomes evident.
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The U. S. government will report weekly jobless claims on Thursday, and some analysts expect the data to show that millions of Americans became unemployed last week. Facebook is struggling with a challenge during the coronavirus pandemic: keeping the site up as usage goes through the roof.
As the coronavirus spread, phone calls over Facebook’s apps more than doubled. In many countries, messaging on Instagram and Facebook soared by more than 50 percent, while group calls in Italy jumped by more than 1,000 percent. The skyrocketing traffic is stressing Facebook’s systems just as its 45,000 employees are dealing with working remotely for the first time. The company’s executives have long preached internally that face-to-face meetings and in-person collaboration were central to Facebook’s success.
The company is also trying to keep its users’ data secure while employees who sift through posts to moderate content do so from home. At the same time, Facebook has added to its workload by promising to do more to limit virus misinformation. “We’re just trying to keep the lights on over here,” Mark Zuckerberg, Facebook’s chief executive, said in an interview last week. In a turbulent past six months, WeWork called off an initial public offering as investors balked at its losses and corporate governance, laid off hundreds of employees, changed its top leadership twice and was bailed out by SoftBank, WeWork’s dominant shareholder.
That was all before the coronavirus pandemic. Since the outbreak, the company, a provider of shared work spaces, has kept most of its locations open even as many offices close, saying that it provided essential services that many state and local governments have allowed to continue operating. That doesn’t mean anyone is in them. In Midtown Manhattan, home to several WeWork spaces, the usual heavy flow of customers has dwindled to a trickle, according to two employees who work in or are monitoring those locations, and who asked not to be named because they feared losing their jobs.
WeWork has allowed employees who normally staff its locations to work from home, but this week it started to entice some to go in with $100-a-day bonuses, according to an internal memo reviewed by The New York Times. Unlike workers employed by restaurants, hotels and retail establishments, gig workers like Uber and Lyft drivers typically have not been able to collect unemployment benefits or take paid sick leave because they are independent contractors, not employees. Even California, which passed a law last year intended to reclassify Uber and Lyft drivers, is failing to approve many unemployment claims from drivers, potentially leaving thousands in the lurch as their earning power collapses. The companies have chosen not to report drivers’ income to the state, as is required of employers, while the law faces a legal challenge from Uber.
A spokeswoman for the California department that oversees unemployment benefits said by email that applicants who were not eligible for benefits because the state lacked their wage information could follow up, and that the department would investigate, awarding benefits if it deemed them misclassified. In 2018, New York State’s unemployment insurance appeal board, its highest executive branch authority on such questions, ruled that three Uber drivers were eligible for unemployment benefits, along with all “similarly situated” drivers. But the state has yet to require Uber, Lyft and other gig economy companies to contribute to its unemployment insurance fund on workers’ behalf while it identifies which drivers are “similarly situated” to those in the appeal board’s ruling.
“In the meantime, gig economy workers must prove their employment status themselves.”
The coronavirus pandemic has so scrambled the global economy that commercial airlines have started doing what was once unthinkable: flying planes without any passengers but loaded with cargo. After consulting an internal crisis playbook, American Airlines on Friday carried out the first such cargo-only trip in 36 years, using a Boeing 777, which can normally seat more than 300 passengers. The airline did two round-trip test flights, ferrying cargo in the plane’s belly from Dallas to Frankfurt and back. “The world is in such a state, we’re in such a state, it’s worth trying and figuring out,” said Rick Elieson, president of cargo and vice president of international operations for the airline.
The test flights, which concluded on Monday, carried medical supplies, mail for active U. S. military troops, telecommunications equipment and electronics. They also proved profitable enough that American is planning to run more cargo flights, possibly as soon as this week, Mr.
Elieson said. American is not alone. Delta Air Lines announced similar cargo flights last week and United Airlines said on Sunday that it was doing the same. Global airline revenue is on track to be $252 billion lower this year than in 2019, representing the worst economic crisis in the history of aviation, the International Air Transport Association said on Tuesday.
That figure is more than double the worst-case scenario the industry group laid out earlier this month. Shopify, a popular technology company that has helped open thousands of online retail sites, has become a favorite tool for fly-by-night businesses looking to cash in on the coronavirus pandemic. New e-commerce sites that use the company’s services are filled with wildly exaggerated claims about virus-fighting products that may not even exist. The New York Times analyzed registrations with Shopify, which allows just about anyone with an email address and a credit card to create retail websites.
The company has registered nearly 500 new sites over the past two months with names that include “corona” or “covid,” The Times found. Untold others have been started using other names. Amy Hufft, a Shopify spokeswoman, said the company last week closed more than 4,500 sites related to the virus. She said sites that did not back up the medical claims they made were suspended from the platform.
By Monday, nearly all the sites identified by The Times had been removed. Companies with billions of dollars tied up in the Olympics are now rushing to put backup plans in place after officials in Japan postponed the games. More than $10 billion in advertising arrangements, sponsorship deals and promotional events were linked to the summer games, which had been scheduled for July, according to the market intelligence service Sportcal. Companies often create elaborate campaigns around the Olympics, the most-watched sporting event in the world, recruiting athletes to star in Olympics-themed commercials and scheduling products to debut in promotional tie-ins.
Companies such as Coca-Cola, Airbnb, General Electric, Procter & Gamble and Visa had signed on as sponsors for the 2020 games. But on Tuesday, the International Olympic Committee and Prime Minister Shinzo Abe of Japan said that the games would be delayed, possibly for a full year. Now, “commercial plans four years in the making are being hastily rewritten around the world,” said Conrad Wiacek, head of analysis and consulting for Sportcal, in a statement. NBCUniversal, the main American broadcaster of the Summer Games since 1988 and the Winter Games since 2002, had already sold more than $1.
25 billion in advertising commitments for 7,000 hours of planned broadcast, streaming and social media content. The media giant was set to send more than 2,000 people to Japan for the games. NBC Universal said in a statement on Tuesday that it was “actively working with our advertising partners to navigate this postponement. ” Universal Studios said on its website on Tuesday that it would extend the closure of Universal Orlando Resort, including its theme parks and entertainment district, through April 19.
Campbell Soup Company said sales of soup jumped nearly 60 percent in the four weeks that ended March 15 from the same period last year, while sales of Prego pasta sauce were up more than 50 percent. The company, which also owns snack lines such as Goldfish, Cape Cod and Kettle potato chips and Snyder’s of Hanover, is offering extra pay to employees who work during the coronavirus crisis. Citigroup will temporarily shut down 10 to 15 percent of its roughly 700 branches by the end of the week in response to “shifts in foot traffic and market dynamics,” a spokesman said. Other branches will have shorter operating hours.
General Motors said it would draw down a $16 billion credit line as it “aggressively pursued austerity measures” to mitigate the business impact of the coronavirus. Business activity in the eurozone plunged in March at record rates, according to surveys by IHS Markit. Britain’s index fell to 37. 1 from 53 in February, the lowest point since comparable figures have been available.
Reporting was contributed by Noam Scheiber, Mike Isaac, Sheera Frenkel, Matt Phillips, Michael H. Keller, Taylor Lorenz, Tiffany Hsu, Niraj Chokshi, Elaine Yu, Ben Dooley, Jason Karaian, Carlos Tejada, Jim Tankersley and Daniel Victor.
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