Coronavirus Update - Unemployment, Stocks, & Airlines
Unemployment Claims Soar Unemployment claims ratcheted up last week to break a record, revealing the full economic effects of American cities and states shutting down to slow the spread of coronavirus. Americans filed a record number of 3.28 million unemployment claims, an increase of 3 million over the previous week, the U.S. Labor Department announced Thursday morning. The number far exceeds the weekly claims during the Great Recession and the previous record of 695,000 in October 1982. Such a large increase wasn’t unexpected given the number of businesses temporarily closing their doors in the retail, hospitality and entertainment sectors across the country.
Markets Move Up The major indices so far have shrugged off the record spike in unemployment claims after the U.S. Senate approved legislation to boost the economy, sending the package to the House. Trading on Thursday morning has been in the green. The Dow Jones Industrial Average is leading the way with a roughly 3.5% bump over yesterday’s close. Synchrony Financial, a company that provides private-label credits for large retailers, was the biggest gainer early in the day. It was followed by credit card companies Discovery Financial Services and Capital One Financial Corp. But as the morning went on, cruise line company Carnival Corp. moved to the top with Norwegian Cruise Line Holdings in the Top 3. Investors are betting they get federal aid from the stimulus package.
Checks to Consumers Coming U.S. Treasury Secretary Steven Mnuchin said families could be receiving checks from the government in about three weeks. With the stimulus package, many people will receive up to $1,200 in funds, with some children getting $500. Those earning $75,000 or more will get less and those making more than $99,000 won't get a check. The amount depends on your last filed tax return.
Airlines May Give Feds Ownership Airlines may have to give up some ownership to the federal government if they want financial rescue from the $2 trillion stimulus package the Senate passed late Wednesday night. Airlines have been hit hard with the travel industry coming to a standstill as everyone tries to slow the spread of the coronavirus. Airlines, cargo carriers and contractors lobbied for a bailout and the stimulus package included $61 billion. Airlines could get federal loans or take direct cash assistance in return for a government ownership stake in the airline. The ownership could come in the form of common stock or stock options. If common stock is the path, the government wouldn’t have voting rights.
States Attempt Limits on Visitors From Other States As the coronavirus spreads to more cities and states, some states are attempting to have visitors self quarantine themselves for 14 days. Florida is requiring anyone who came from New York, which has the most coronavirus cases in the United States, in the past three weeks to quarantine for 14 days. Alaska residents and visitors are required to self quarantine for 14 days. South Carolina Gov. Henry McMaster asked visitors to self quarantine for 14 days as well. Hawaii, which relies on tourism, has asked visitors to delay plans to visit for 30 days.
Demand for Pure Oxygen Soars With the scramble to fill a shortage of ventilators to treat coronavirus patients, the need for purified medical oxygen used in the equipment has increased dramatically. French company Air Liquide and Allentown, Pennsylvania-based Air Products & Chemicals Inc., the two largest suppliers of this type of oxygen, are working to ensure supply meets the demand, the Wall Street Journal reported. The oxygen arrives in tanks as a liquid and then is converted to gas. The issue may be getting full tanks to hospitals and empty tanks back for refilling. Both companies are trying to avoid bottlenecks in the delivery process. In the United Kingdom, for example, Air Products is training military drivers should the government need to go that route.
First Federal Coronavirus Fraud Case The U.S. Department of Justice nabbed a Southern California man for attempting to sell a fake prevention for the coronavirus and to attract investors to the scheme. According to the Washington Post, Keith Lawrence Middlebrook was arrested after meeting an undercover agent. If convicted, he faces up to 20 years in prison. This month, Middlebrook posted to his 2.4 million Instagram followers that he had pills and a liquid injection that would keep him from contracting the coronavirus. Apparently, he’s had small parts in “Iron Man 2” and “Moneyball.”
Original article from www.Costar.com
By Richard Lawson CoStar News March 26, 2020 | 09:19 A.M.