Beijing time on the 27th morning, the U.S. stocks on Friday, the banking sector led the decline. There has been a surge in infections in the United States, with at least 11 states announcing suspensions or delays in the restart program. The Fed will limit financial institutions’ dividend payments and share buybacks in the third quarter. The Dow is down 730.05 points, or 2.84 per cent, at 2,515.55, the Nasdaq is down 259.78 points, or 2.59 per cent, at 9,757.22 and the Standard and Poor’s 500 is down 74.71 points, or 2.42 per cent, at 3,099.05.
The Dow is down 3.3 per cent this week, the S.P. 500 is down 2.9 per cent and the Nasdaq is down 1.8 per cent.
The Fed will limit financial institutions’ dividend payments and share buybacks in the third quarter. The banking sector fell sharply on the news, with Dow component Goldman Sachs closing down 8.7 per cent, JPMorgan Chase down 5.5 per cent and American Express down 4.6 per cent.
The airline and cruise sectors fell as infections accelerated and states such as Texas suspended the economic impact. The crude oil sector also fell broadly.
“The surge in coronavirus cases in the U.S. and the delay in restarting the economy in many states will at least affect corporate earnings,” said Tom Essaye, founder of Sevens Report. The resurgence of infections has raised concerns that the rebound in the stock market may be temporary as more local governments become more likely to shut down the economy again. “
Fed limits third-quarter dividends and share buybacks by financial institutions
The Federal Reserve, which released bank stress test results after U.S. stocks closed On Thursday, said it would limit financial companies’ dividend payments and share buybacks in the third quarter. The Fed said it was doing so to “ensure that the big banks remain resilient in the face of economic uncertainty caused by the coronavirus outbreak”.
The Fed’s bank stress tests showed that the coronavirus outbreak had had a varying degree of impact on the big banks, and that a small number of banks could face the potential risk of undercapitalising, so the Fed asked the big banks to suspend share buybacks and dividend payments in the third quarter to ensure they were adequately capitalized.
The Federal Reserve said in a statement the same day, the stress test added a sensitivity analysis of the new crown outbreak, the three economic downside risk path into the simulation scenario, including the end of the rapid recovery of the “V” trend, slow recovery of the “U” trend and the economy after a short recovery of a serious decline in the “W” double-dip recession trend.
Meadowlands coronavirus infection surges, restarts economic process into chaos
The further increase in cases of coronavirus in many parts of the United States has alarmed investors. There are growing signs that the u.S. economic restart is in disarray. Nearly 40,000 new confirmed cases were reported in the United States on Thursday, a record high.
As of 13:33 BST on June 26, there were more than 2.44 million confirmed cases of coronavirus in the United States, 2444,483 cases and 124,732 deaths, according to the latest data from Johns Hopkins University.
At least 11 U.S. states have now announced suspensions or delays in restarting their programs, hurt by a rebound in data on confirmed cases of coronavirus. The governors of Florida and Texas have announced the withdrawal of some restart measures, while the governors of Arizona, Arkansas, Delaware, Iowa, Louisiana, Maine, Nevada, New Mexico and North Carolina have announced that they will not proceed with the next phase of the restart.
Anthony Fauci, a CDC official and director of the National Institute of Allergy and Infectious Diseases, said at a White House briefing Friday that the coronavirus outbreak rebound data show edified “serious problems” in parts of the United States.
Mr Fauci said the rebound in some areas was due to premature economic opening or the failure of the population to comply with epidemic prevention guidelines. Everyone should not only be “responsible for themselves” but also “socially responsible” to prevent the spread of the epidemic. “People are infecting each other, and eventually vulnerable people are infected by you, ” Says Fauci.
Will Geisdorf, senior research analyst at Florida-based Allegiant Private Advisors, said: “The number of new confirmed cases in the U.S. is a record high, and I think the market is watching this closely and starting to lower expectations for a V-shaped recovery in the U.S. economy.” “
He said pressure for a new round of fiscal stimulus by policymakers was mounting as evidence mounted that consumer confidence was flagging. “This is the solution that the market needs to get out of this period of adjustment and volatility and continue to move higher, ” he said. We’ve had the best 50 days in U.S. stock history. Some corrective action is now needed to alleviate over-optimism. “
Texas was one of the first U.S. states to relax the embargo, and State Governor Greg Abbott announced Thursday that he would temporarily halt the restart process. Mr Abbott said the moratorium was aimed at curbing the spread of the outbreak until the next phase could be safely moved to the next stage. He also stressed that people should wear masks and keep their social distance from others.
With the state’s multi-district care system nearing saturation, Greg Abbott also ordered non-emergency operations to be suspended in the state’s four largest counties — Bexar, Dallas, Harris and Travis — to make room for new patients diagnosed with the coronavirus. The state of Texas says it will take steps to ease the pressure on hospitals from a surge in confirmed cases of coronavirus. According to reports, 25, the Houston area of Texas intensive care beds have been fully loaded.
California Governor Newsome said Thursday that the number of hospitalizations for coronavirus in the state has increased by 32 percent in the past two weeks. He said California would consider delaying plans to restart the economy further if the number of patients began to put pressure on beds in hospitals, especially in intensive care units. He also points out that one reason for the recent surge in new cases in California is the spread of the virus at private gatherings, such as family gatherings, birthday parties, graduation parties and other events.
Arizona Gov. John D.C. said plans to restart the economy further were suspended because of the outbreak. He said companies and merchants, which are still in operation, would be required to adhere strictly to measures to maintain social distance. At the current rate of infection, he said, the state’s hospital intensive care unit would soon be overwhelmed.
Arizona and Florida also outpaced recent trends in new infections, according to Thursday’s statistics, indicating an accelerated increase in the epidemic.
Due to the recent rapid increase in cases of coronavirus, many companies have also delayed the process of restarting operations. Apple (AAPL) has announced a new closure of more stores after a jump in infected cases. The company announced last week that it had closed more than 10 stores in four states, seven stores in Houston, Texas, earlier this week and 14 more in Florida yesterday.
Disney (DIS) has announced it will indefinitely delay the reopening of its California theme park, which was due to reopen on July 17.
U.S. President Donald Trump tweeted Friday that the u.S. is on the decline in coronavirus deaths and that the economy is recovering and will not stop.
Chicago Federal Reserve Bank President John Evans has said the U.S. economy is not expected to return to pre-epidemic levels until the end of 2022. For a significant number of people and businesses, the economic impact has been disastrous, Evans said. Unfortunately, some of the most vulnerable people are being paid the most. Evans also believes that a quick restart of the economy could lead to a worsening of the current U.S. outbreak.
On the economic front, U.S. consumer spending rose 8.2 percent month-on-month to 9.3 percent in May, while U.S. personal income fell 4.2 percent in May, compared with a 6 percent decline.
On the European side, European Central Bank President Christine Lagarde said Europe may have weathered the worst of the crisis. But Ms Lagarde also warned that recovery would be a complex issue and that a second wave of outbreaks needed to be alerted to. Lagarde also said there is no doubt that all monetary and fiscal instruments must be used.
Nike reported a 75 percent jump in online sales last quarter, but that portion accounted for only 30 percent of overall revenue, while sales at most brick-and-mortar stores were sluggish, with overall revenue of $6.31 billion, down 38 percent from a year earlier. In addition, Nike lost $790 million, or 51 cents per share, in the quarter, down from a profit of $989 million, or 62 cents per share, a year earlier.
Microsoft said it would permanently close its brick-and-mortar stores but would continue to invest in digital stores. Microsoft said the move would result in pre-tax charges of about $450 million, or 5 cents per share, for the current quarter.
Swedish clothing retailer H.M. said on Friday it had posted a pre-tax loss of 6.48 billion Swedish francs ($700 million) in the second quarter ended May, the first quarterly loss in a decade.
Macy’s, the department store chain, is expected to cut nearly 4,000 jobs. Macy’s announced a restructuring plan on June 25th, local time, to cut 3,900 corporate and management jobs. The department store said it expects the layoffs to save the company about $630 million a year.
Verizon, the US telecoms giant, has joined the boycott of Facebook and will suspend advertising. Verizon said Thursday that it will suspend advertising on Facebook and its Instagram platform until the company “can create an acceptable solution that we are satisfied with.” It comes after several companies announced they were suspending ads on Facebook.
Apple has reopened 32 U.S. retail stores. Apple inc. said Thursday it will reopen 14 retail stores in Florida as the number of new cases in the state increases,media reported. Apple is reported to have reopened seven stores in Texas on Wednesday and 11 in Florida, North Carolina, South Carolina and Arizona last week. So far, Apple has reopened 32 U.S. retail stores because of a rebound in the new U.S. crown.
SpaceX launched the Starlink satellite on Friday, with nearly 600 satellites. With two more launches scheduled for June, SpaceX is scheduled to launch five Falcon 9 rockets in about a month. This will be SpaceX’s third launch of the Starlink satellite in June, bringing the growing constellation to nearly 600 satellites and nearing the threshold of 800 orbiting “routers.” Musk has said this will allow the start of some limited broadband services.
MasterCard has pledged to significantly increase the number of black executives. MasterCard on Thursday pledged to improve diversity in its leadership, and plans to increase the number of black executives at the vice president’s level by 50 percent by 2025,media reported. MasterCard chief executive Ajay Bang said in a memo to employees that the company will also evaluate its payment systems and “adjacent ecosystems” to eliminate bias and inequality in serving the black community. According to the memo, MasterCard will increase spending on black suppliers by more than 70 percent to $100 million a year by 2025.
European stocks closed mixed on Friday, with europe’s pan-European 300 index closing down 0.29 per cent, Britain’s FTSE 100 up 0.5 per cent, Germany’s DAX down 0.7 per cent, France’s CAC closing flat and Spain’s IBEX down 1.3 per cent.
Gold futures closed higher on Friday, with gold prices posting gains this week. Gold prices have been bolstered by a surge in cases of coronavirus infection in the United States, raising fears that a new round of closures aimed at curbing the spread of the epidemic is imminent.
“For gold, the old story is back,” said Lukman Otunuga, senior research analyst at FXTM. Fears of a second outbreak of the coronavirus outbreak have supported gold prices. “
Gold futures for August delivery rose $9.70, or nearly 0.6 percent, to $1,780.30 an ounce on the New York Mercantile Exchange.
Silver futures for July settled up 14 cents, or 0.8 percent, at $18.035 an ounce. Silver futures for September rose 12 cents, or nearly 0.7 percent, to close at $18.168 an ounce.
Gold futures rose 1.6 per cent this week, the third straight week of gains, on the most active contracts. Silver futures were up 1.1 percent.
Crude oil futures closed lower Friday, with U.S. WTI crude futures down more than 3 percent this week. The surge in cases of coronavirus infection in the United States has raised concerns that the recovery in energy demand will be hampered.
West Texas Intermediate (WTI) futures for August delivery fell 23 cents, or 0.6 percent, to close at $38.49 a barrel on the New York Mercantile Exchange.
Brent crude, used to price international oils, fell 54 cents, or 1.3 percent, to close at $40.61 a barrel on the London-based Intercontinental Exchange.
U.S. WTI crude fell 3.4 percent this week and Brent crude futures fell 3.1 percent.