Global stocks stabilize after several days of turbulence.
Global stock markets rose modestly on Wednesday, after several days of turbulence fueled by a cascade of news about the coronavirus and its impact on the global economy.
European stocks opened less than 1 percent lower, after a mostly positive trading day in the Asia-Pacific region. Japanese stocks were the exception, falling 0.6 percent after the release of data showing a sharp drop in exports in May.
Prices for U.S. Treasury bonds dropped, signaling improving investor sentiment. Oil prices also rose slightly in futures markets.
Futures that track American stock indexes were predicting a muted rise when Wall Street opens later in the day.
Markets went on a wild ride during the previous four trading days. Investors late last week grew alarmed as the number of infections grew in states like Florida and Arizona. A fresh outbreak in Beijing over the weekend also raised questions about China’s efforts to contain the outbreak.
At the same time, investors also reacted positively to reports of efforts by governments to address the economic damage, as well as data signaling improvement. The latest data point came on Tuesday, when stocks were buoyed by a report showing retail sales in the United States jumped 18 percent in May, a stronger than expected bounce.
On Wednesday, investors were also cheered by a lack of immediate worsening of tensions between China and India over a border clash that occurred on Monday.
Wall Street is lifted by retail sales and prospects for a Covid-19 treatment.
Wall Street’s roller coaster continued on Tuesday, as investors cheered a surprisingly strong rise in retail sales and a progress on a potential treatment for Covid-19, while shrugging off reports of new cases of the virus in the United States and stricter measures in China to clamp down on a fresh outbreak.
The S&P 500 rose nearly 2 percent, led by sectors that are sensitive to the short-term outlook for the economy such as industrial and energy stocks. Energy was the best-performing part of the market, as benchmark American crude rose more than 3 percent.
Hopes for a strong economic rebound were buoyed by a report showing retail sales jumped 18 percent in May, a stronger than expected bounce. It was the biggest jump on record and helped repair much of the damage from the previous month, which showed the largest-ever monthly collapse in retail sales.
“That allows the bulls to continue the narrative of a V-shaped recovery,” said Randy Watts, chief investment officer at the investment firm O’Neil Global Advisors.
Specialty retailers like Nordstrom, Kohl’s, Gap and L Brands rose sharply, as did home improvement retailers Home Depot and Lowe’s.
Investors were also heartened by news that scientists at the University of Oxford said on Tuesday that a 6,000-patient trial in Britain showed that a low-cost steroid, dexamethasone, could reduce deaths significantly for hospitalized Covid-19 patients. That optimism helped lift share prices for companies in industries especially exposed to the virus. Airlines, cruise lines and casino companies rose.
An Illinois businessman who applied for small-business relief is charged with fraud.
A businessman in Evanston, Ill., tried to fraudulently obtain a $440,000 loan through the Paycheck Protection Program, a government relief fund for small companies harmed by the pandemic, by using false tax and payroll records, the Justice Department said on Tuesday.
Rahul Shah describes himself on LinkedIn as the chief executive of Katalyst Technologies, which says on its website that it makes business software. In late April, he applied for a P.P.P. loan for a different company, N2N Holdings, which does business as Boardshare and lists Mr. Shah on its website as its chief executive.
Mr. Shah’s loan application claimed that N2N had 10 employees and an average monthly payroll of $176,455, according to a criminal complaint filed against him in the United States District Court for the Northern District of Illinois. But it raised alarms at the bank — not named in the complaint — because tax records from the Internal Revenue Service showed a far more modest payroll, with N2N’s employee wages dropping to $0 at the end of last year. The bank declined to make the loan.
When federal law enforcement agents interviewed Mr. Shah last month, he acknowledged that there were “errors” in his documentation, the complaint said. He is charged with bank fraud and making false statements to a financial institution. Mr. Shah did not immediately respond to request for comment.
Lawmakers and government officials have said they will seek out and prosecute those trying to bilk the loan program, a rushed and often chaotic effort to distribute $660 billion to needy small companies devastated by coronavirus shutdowns. Last month, two New England men were arrested and charged with using false documents to seek loans totaling more than half a million dollars.
Table for two in the street? As restaurants reopen, seating moves outdoors.
As restaurants around the country look to reopen during the coronavirus pandemic, outdoor seating is becoming a survival option, and local governments are helping by cutting red tape.
With the spread of the coronavirus still a danger, many states are requiring that restaurants reduce their capacity to 25 to 50 percent of normal operations to ensure there is at least six feet between tables. Some, like New Jersey, are prohibiting indoor dining altogether for the time being.
However, local officials are trying to give at least some of that capacity back by allowing eating establishments to expand onto patios and parking lots, and even city sidewalks and streets. And they are reducing or waiving fees and quickly approving plans that previously may have taken months to process.
The effort appears to be paying off. OpenTable, a provider of online restaurant reservations, has counted a tenfold increase in outdoor seating this spring compared with a year ago.
Catch up: Here’s what else is happening.
Jerome H. Powell, the Federal Reserve chair, told lawmakers on Tuesday that the path to economic recovery remained uncertain and warned that a prolonged downturn could widen existing inequalities. “Low-income households have experienced, by far, the sharpest drop in employment, while job losses of African-Americans, Hispanics and women have been greater than that of other groups,” he said.
Reporting was contributed by Mohammed Hadi, Stacy Cowley and Jane Margolies.