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Jun 25, 2020

DealBook | US Jobless Expectations: U.S. Jobless Claims May Top 1 Million: Live Business Updates

7-8 minutes - Source: NYT

Economists expect 1.3 million new state unemployment claims.

With businesses reopening in fits and starts and anxiety increasing over new coronavirus hot spots, the latest unemployment reading on Thursday is likely to offer scant comfort.
Economists surveyed by Bloomberg expect the Labor Department to report that 1.3 million new claims for state unemployment insurance were filed last week, with 20 million people continuing to collect state benefits. If the forecasts are correct, it would be the 14th week in a row that new claims have topped one million.
The latest data will be published amid conflicting signals for the economy. New York and some other places that were hard hit are starting to get back to business. But a surge in cases in states that reopened earlier has raised fears of new setbacks.
On Tuesday, Gov. Greg Abbott of Texas urged residents to stay home and warned that the state might have to impose new restrictions if the virus could not be contained. And California and Florida have each posted record numbers of new cases in recent days.
Apple shut stores it had reopened in four states — Florida, South Carolina, North Carolina and Arizona — and on Wednesday closed seven stores in Houston.
“The renewed outbreak will hinder the recovery,” said Carl Tannenbaum, chief economist at Northern Trust in Chicago. “I can’t help but think that the willingness of consumers to be in crowded places has diminished. It’s going to be a long haul to get back to where we were before the pandemic.”

Stock markets are mixed ahead of U.S. jobless claims.

Credit...Charly Triballeau/Agence France-Presse — Getty Images
U.S. stock futures fell and global markets were choppy on Thursday as investors worried about new coronavirus outbreaks and braced for unemployment claims data from the United States.
Futures markets were predicting Wall Street would open slightly lower. Major European markets wavered between gains and losses, following a more than 1 percent drop in Tokyo.
Other markets signaled hesitance. Prices for U.S. Treasury bonds, which often rise in times of uncertainty, were mostly higher. Oil prices were lower.
Investors have fretted for days about persistent reports of new infections in the United States, raising questions about how quickly the world’s largest economy can fully reopen and get back up to speed. India and Brazil have also reported higher infections, days after China and South Korea also disclosed outbreaks.
Those concerns drove stocks in the United States down heavily on Wednesday, with the S&P 500 index falling more than 2 percent.
On Thursday, investors were also bracing for the latest data on U.S. jobless claims, which is expected to show that more than a million people filed for state unemployment benefits last week, despite the reopening of businesses.

The founder of SoftBank is resigning from Alibaba’s board.

Credit...Kim Kyung Hoon/Reuters
Masayoshi Son, the founder of SoftBank, the Japanese conglomerate and investment company, said on Thursday that he would resign from the board of Alibaba, the Chinese e-commerce company, in which he was an early and wildly successful investor.
The move comes after Jack Ma, Alibaba’s co-founder, said last month that he would quit SoftBank’s board, without giving an explanation
SoftBank, which runs the world’s largest technology investment fund, has been hit hard by the coronavirus pandemic, which has cratered the values of some of its largest holdings, like the car-sharing service Uber and the Indian hospitality firm Oya.
Alibaba has been a golden goose for SoftBank. Mr. Son’s original investment of $20 million grew into a stake valued at more than $100 billion. In recent months, SoftBank has sold down part of its stake in the Chinese company to raise funds for a large share buyback intended to juice its stock price.
Mr. Son and Mr. Ma have been longtime members of each other’s boards. Addressing an annual meeting of SoftBank’s shareholders, Mr. Son said that there was no bad blood between the two.
“It’s just a happy ending,” Mr. Son said. “Jack is kind of graduating from SoftBank Group, and I am graduating from the Alibaba Group.”

Disney postpones its plans to reopen theme parks in California.

Credit...Mike Blake/Reuters
The Walt Disney Company on Wednesday abandoned a plan to reopen its California theme parks on July 17, citing a slower-than-anticipated approval process by state regulators. The announcement came amid tension with unionized Disneyland employees, some of whom had publicly criticized the company’s reopening timetable as too fast.
“The State of California has now indicated that it will not issue theme park reopening guidelines until sometime after July 4,” Disney said in a statement. “Given the time required for us to bring thousands of cast members back to work and restart our business, we have no choice but to delay the reopening of our theme parks and resort hotels until we receive approval from government officials.”
Disney did not give a new target reopening date. The company said it would move forward with plans to reopen its Downtown Disney shopping mall in Anaheim, Calif., on July 9.
Disneyland and Disney California Adventure, which border each other in Anaheim, closed on March 13. Two weeks ago, Disney presented government officials with a plan to reopen both parks on July 17 with limited capacity and stringent safety policies, including mandatory mask wearing. Other theme park operators in California have made similar proposals; Universal Studios Hollywood said it would like to reopen as soon as July 1, pending state approval.
But coronavirus cases in California have been soaring. Gov. Gavin Newsom said on Wednesday that the state recorded more than 7,000 new cases over the past day.
Unions representing most of the Disneyland’s 32,000 employees sent a letter to Governor Newsom on June 17 saying that “despite intensive talks with the company, we are not yet convinced that it is safe to reopen the parks on Disney’s rapid timetable.” Since then, many of Disney’s unions have signed agreements with the company outlining enhanced safety procedures.

Catch up: Here’s what else is happening.

  • Qantas, the Australian airline, will cut roughly one-fifth of its work force as it joins other airlines grappling with the global near halt in travel. In addition to the reductions of at least 6,000 jobs, it would also keep another 15,000 workers on furlough until flying resumes. It will also retire its six Boeing 747 jumbo jets six months ahead of schedule.
Reporting was contributed by Ben Dooley, Mohammed Hadi, Matt Phillips, Nelson D. Schwartz, Carlos Tejada, Brooks Barnes and Alan Rappeport.

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