Shares of companies likely to get help from the government surged.
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.
“We’re looking forward to closing a bipartisan deal today,” Steven Mnuchin, the Treasury secretary, told reporters as he arrived on Capitol Hill for a round of meetings on Tuesday morning.
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. Those gains followed a similar performance in Asia, where major markets around the region posted increases that ranked among their biggest gains in weeks.
Shares of hard-hit industries likely to receive aid, such as casinos and cruise lines, soared. Norwegian Cruise Lines jumped 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 both 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.
Tuesday’s jump 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. 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.
With fewer passengers, airlines test cargo flights.
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.
But the economics of doing so could change in an instant.
“It may work next week or it may not work next week, and it may work again the week after that. So it’s very fluid,” he said. “That will surprise no one, to learn that this industry is no different than everything else going on in the world right now — lots of uncertainty.”
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.
Coronavirus outbreak spurs a save of suspicious websites.
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…
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