Offshore oil drilling platforms are seen at sunset Tuesday, April 21, 2020, near Huntington Beach, Calif. Oil prices continue to drop, because very few people are flying or driving, and factories have shut amid widespread stay-at-home orders due to the coronavirus concerns. (AP Photo/Chris Carlson)
By Stan Choe and Damian J. Troise
Stocks around the world are clawing higher on Wednesday, and the S&P 500 climbed toward its first gain in what’s been a dismal week for markets.
Even oil gained ground. Prices for crude have been turned upside down because of how much extra oil is sloshing around following a collapse in demand. U.S. oil jumped 19% after President Donald Trump threatened the destruction of any Iranian gunboats that harass U.S. Navy ships, raising the possibility of a disruption to global oil supplies.
The S&P 500 was up 2.6% in the last hour of trading, following up on milder gains in Europe and Asia. It trimmed its loss for the week back below 2.5%, and Treasury yields also pushed higher in a sign of a bit less pessimism in the market.
The Dow Jones Industrial Average was up 529 points, or 2.3%, to 23,548, as of 3:05 p.m. Eastern time, and the Nasdaq was up 3.1%. Gains accelerated through the day and were widespread, with all 11 sectors that make up the S&P 500 up.
”This has been a tremendously good reminder that the stock market is a forward predictor,” said Andrew Slimmon, managing director and senior portfolio manager at Morgan Stanley Investment Management.
Investors sent U.S. stocks down by a third from February into late March, before efforts to slow the spread of the coronavirus threw the economy into a recession. Now, even as depressing economic and health reports pile up by the day, some investors are looking ahead to the possibility of parts of the economy reopening as infections level off in some areas.
The recession is still expected to be painfully deep, but potentially short, Slimmon said, which is pushing some investors to buy stocks that have been beaten down.
Energy stocks jumped to some of the market’s biggest gains, riding the ripple of strengthening oil prices. Halliburton, Diamondback Energy and Apache all added more than 8%. All three, though, remain down more than 60% for the year so far.
A barrel of U.S. oil to be delivered in June settled at $13.78. It had zig-zagged earlier in the morning, before Trump’s tweet. The big gain, though, means it’s recovered just a fraction of its steep losses. It was close to $30 at the start of last week and nearly $60 at the beginning of the year.
Brent crude, the international standard, climbed 5.4% to $20.37 per barrel.
Other companies that have been big losers due to the coroanvirus pandemic also rose after offering some slight hints of hope.
Chipotle Mexican Grill, for example, said that a key sales figure plunged 16% in March on widespread stay-at-home orders. But it hit a bottom during the week of March 29, down 35%, and has since improved a bit. Declines the past week were “in the high teens.” Its shares rose 12.3%.
Stocks of companies that have been winners in the new stuck-at-home economy, meanwhile, are also telling investors just how much they’ve been benefiting.
With people hunkered inside and craving for communication, Snap said that the number of active users on Snapchat each day jumped 20% in the first three months from a year ago. Its revenue topped Wall Street’s expectations, and Snap shares jumped 32.3%.
Netflix has also been a big winner as people look to fill their time, with shares recently hitting a record. It said late Tuesday that it added nearly 16 million global subscribers in the first three months of the year. But shares slipped 2.3% Wednesday after its profits didn’t quite live up to Wall Street’s lofty expectations.
Toilet paper has also been hugely in demand, and the maker of Cottonelle and Scott said its sales benefitted in the first three months of the year as customers stocked up on them and Kleenex tissue, among other items. Shares of Kimberly-Clark were up 1.6% after earlier flipping between gains and losses.
The company also retracted its financial forecasts for 2020 given how uncertain the global economy is due to the COVID-19 outbreak. It joined a lengthening line of companies pulling their guidance, and it also suspended its stock buyback program until at least the end of June.
The Senate late Tuesday approved a $483 billion proposal to deliver more loans to small businesses and aid to hospitals. The House is expected to vote on it Thursday.
The new bill would come on top of more than $2 trillion in aid that Congress has already approved. That, plus massive support for markets from the Federal Reserve, has helped the S&P 500 to rise more than 24% since a low in late March. The index has roughly halved its loss from its record set in February, which at one point was roughly 34%.
The yield on the 10-year Treasury rose to 0.62% from 0.57% late Tuesday. But it remains well below the 1.90% level where it started the year.
The global economy has come to a virtual standstill amid widespread stay-at-home orders, and economists expect a report on Thursday to show that another 4 million-plus workers filed for unemployment benefits last week. That would be on top of the roughly 22 million workers who had filed in the earlier four weeks, as layoffs sweep the nation.
In Europe, Germany’s DAX returned 1.6%, France‘s CAC 40 gained 1.2% and the FTSE 100 in London added 2.3%. In Asia, South Korea’s Kospi rose 0.9%, the Hang Seng in Hong Kong gained 0.4% and Japan’s Nikkei 225 fell 0.7%.
Jason Moser, Senior Analyst at The Motley Fool, breaks down AMC's third quarter earnings and discusses the future of the theater chain despite low ticket sales.
IBM's spinoff, Kyndryl, is officially an independent public company. The $19 billion business is now listed on the NYSE under the ticker KD, becoming one of the largest players in the IT services market. David Wyshner, CFO of Kyndryl, joined Cheddar to discuss what this milestone means for the company moving forward.
Emma Searson, an author on the just-released Renewables on the Rise report and the director, 100% Renewable Campaign at Environment America, joined Cheddar to discuss the rapidly growing renewable energy sector. Between 2011 and 2020, the report shows that wind, solar, and geothermal energy production grew about 15 percent annually and that wind and solar alone account for 11 percent of electricity in the country. "There are a few really important drivers of the renewable energy progress that we're seeing all across the country," Searson said, highlighting falling prices, technology improvements, and supportive policies.
Wendy O, host of 'The O Show' joins Cheddar News to discuss the recent rally from cryptocurrency, Ether. She also discussed incoming New York City mayor Eric Adams wanting to teach kids crypto in schools.
Professional sports is facing a reckoning right now over several stories painting an ugly picture of a toxic work environment, encompassing multiple teams in multiple leagues and dealing with different issues.
This week, the NHL's Chicago Blackhawks ousted their general manager and senior director of hockey operations after an investigation confirmed former player Kyle Beach's claims that the team's former video coach Brad Aldrich sexual assaulted him back in 2010, with upper management ignoring his claims until after the team won the Stanley Cup that season. Last night, Joel Quenneville, now the coach of the Florida Panthers but Chicago's coach that season, stepped down from his post.
This comes just a few weeks after the NFL was rocked by leaked emails showing now-former Las Vegas Raiders Head Coach Jon Gruden using racist, sexist and homophobic language. He resigned soon after the emails came to light. We can't forget, though, that those emails come from a much broader investigation of the toxic work environment in the offices of the Washington Football Team. NFL Commissioner Roger Goodell said this week the league wouldn't publicly release anything from its investigation of the team, but lawyers for many of the women interviewed in the case say they want a public report.
And last January, just one month after hiring him, the New York Mets had to fire then-General manager Jared Porter, who admitted to sending explicit, unsolicited texts and images to a female reporter in 2016 when he worked for the Chicago Cubs. ESPN had been in possession of the texts since 2017, but the woman in question asked the network not to run the story out of fear her career would be harmed. She only reached back out to ESPN after she left the field of journalism altogether. Porter has been banned from the sport through next season.
If you believe in the phrase "where there's smoke, there's fire," professional sports is a five-alarm blaze.
Julie DiCaro, senior writer and editor at Deadspin, joins None of the Above to discuss.
Curaleaf CEO Joe Bayern joined Cheddar's "Closing Bell" to discuss the cannabis company's Q3 earnings report, which came in under expectations and included widening losses. Bayern discussed taking a hit on profitability based on the slower-than-expected expansion in some Northeast markets. While the company reduced its fiscal guidance for 2021 due to a general slowing of the cannabis market, he did note that he still sees much room for growth in 2022 and beyond.
Online consignment and thrift shop thredUP reported a Q3 earnings beat on Monday, and CEO James Reinhart joined Cheddar to discuss exceeding expectations and the state of the business overall. Reinhart said the company is thriving while other businesses may face supply chain issues due to the convenience of its system of acquiring secondhand clothing. "In a world where most consumers are feeling squeezed by prices and seeing apparel shortages, everything we have on thredUP is 100 percent in stock and ready to ship," he said. "And so I think it speaks to real opportunity for resale and a company like thredUP during the holiday season and into 2022."
Former NBA star, commentator, and entrepreneur Baron Davis and Deluxe Corporation Chief Brand Officer Amanda Brinkman, joined Cheddar to discuss Season 6 of the reality show "Small Business Revolution," premiering Tuesday. The season will focus on helping six Black-owned businesses in the Twin Cities, Minneapolis and St. Paul. Davis noted learning about the lack of resources, connections, and opportunities for Black business owners during the show. "There are so many things we need to do as a society to address racial injustice and inequity, however, one of the ways for it is economic empowerment," Brinkman added.
Katia Beauchamp, strategic advisor for FemTec Health and former Birchbox CEO, joined Cheddar to discuss the health and beauty sciences company's recent acquisition of subscription beauty supply provider Birchbox. She noted that FemTec wants to change the perception of the brand to include health as well as beauty. "This is something where we are reimagining how can we help consumers discover beauty products that really help them take great care of themselves, have beautiful underlying health that is shown on the exterior too," she added.
