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The Dow Jones is rising today as traders speculate on the success of efforts to reopen parts of the U.S. economy. Across the country, many Americans are concerned about a second wave of COVID-19, while others are pining to get back to normal as soon as possible.
We'll also cover the future outlook for airline stocks right now, like United Airlines Holdings Inc. (NYSE: UAL). Here's everything moving the Dow today.
First, the numbers from Monday for the Dow, S&P 500, and Nasdaq:
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Here are the most important market events and stories that I'm following right now.
The Top Stock Market Stories for Tuesday
- The U.S. Treasury Department isn't concerned about the federal debt. Reports indicate that Steven Mnuchin and friends are looking to borrow a staggering $3 trillion during the second quarter. The government's debt currently sits at $25 trillion, on pace to run a deficit of $744 billion before factoring in the cost of COVID-19 on the U.S. economy. The U.S. borrowed $477 billion during Q1. It will also borrow another $677 billion during Q3, according to Treasury Department estimates. Just a reminder: Gold is trading at $1,704 per ounce, while Bitcoin hovered around $8,900 on Tuesday morning.
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- Global coronavirus cases topped 3.5 million on Tuesday morning, according to Johns Hopkins University. Roughly 1.18 million of those cases have occurred in the United States, with the death toll around the world topping 251,000. Russia has announced more than 10,000 cases over the last 24 hours, while Spain reported another 185 deaths. The latter figure is seen as a positive development, as it is the third consecutive day that officials reported a figure under 200. Finally, Germany has reported that its reproduction rate for COVID-19 has declined to 0.71, a figure that suggests a decline in new infections over time. The figure indicates that 100 people would infect an average of 71 others, igniting hopes that the virus could eventually burn out between Germany's borders.
- Meanwhile, oil prices are picking up as traders speculate on an uptick in demand. The lockdown may start to ease across the country, and "driving season" approaches in America. WTI crude futures jumped 10.2% this morning to hit $22.50 per barrel. Brent crude jumped nearly 8% to tick above $29.35 per barrel. Around the world, oil demand fell by about 30% in April. But the prospect of people returning to work and life in Europe and India has speculation driving prices higher.
Stocks to Watch Today: UAL, HTZ, CHGG
- United Airlines Holdings Inc. (NYSE: UAL) will slash its management ranks by 30% by October, according to various media reports. According to a memo seen by Reuters, the firm will slash about 3,400 management and administrative employees in the fourth quarter. The airline also told pilots to prepare for changes at the organization. The firm is among the first airline companies to accept government aid to pay employees. However, the aid comes with the stipulation that it will not cut jobs or pay before Sept. 30.
- Shares of Hertz Global Holdings Inc. (NYSE: HTZ) are off more than 20% this morning after reports stated that the firm is exploring bankruptcy proceedings. Last week, the company announced it had missed a debt payment due to a "rapid, sudden, and dramatic negative impact" on its operations during this COVID-19 crisis. The firm had until yesterday to make the payment, but it appears that the firm has chosen to take the route of bankruptcy as it hires new advisors to explore strategic options. The sudden crash is a major blow to hedge fund investor Carl Icahn, who is a big financial backer of the firm.
- Shares of Chegg Inc. (NASDAQ: CHGG) surged more than 18% this morning after the education company easily topped Wall Street earnings expectations on Thursday. The firm reported earnings per share of $0.22 on top of $131.6 billion in revenue. The average Wall Street estimates were roughly $0.15 per share on top of $122.7 million. The firm said it saw a big uptick in new subscribers thanks to "stay at home" orders that forced millions of American students to adopt distance learning.
Why Startups Can Have an Edge During a Recession
Uber, Airbnb, Slack, Pinterest, and Venmo have something big in common – something other than their big names.
These startups were founded during the last recession.
And now, some of the most iconic companies of our time could launch into Fortune 500s during days like today.
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.