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The Dow Jones popped 130 points as states set to reopen their economies over the next two weeks. U.S. President Donald Trump said Tuesday that there will "be more death" due to COVID-19 but that the failure to reopen the economy could cause damage in the form of suicides and drug overdoses.
More COVID-19 coverage below. Here's everything moving the Dow today.
First, the numbers from Tuesday for the Dow, S&P 500, and Nasdaq:
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Now, here's a closer look at today's most important market events and stocks. We'll also discuss the stories that slipped under the radar of the mainstream financial press on Wednesday.
The Top Stock Market Stories for Wednesday
- This morning, Johns Hopkins University announced more than 3.65 million official cases of COVID-19 around the globe. States across the country will reopen their economies this week. Florida has opened restaurants with social distancing guidelines in place. California will permit clothing stores, flower shops, and bookstores to provide curbside pickup. And New York will let construction, manufacturing, and certain retail employees return to work. The official U.S. tally of coronavirus cases topped 1.2 million on Tuesday evening.
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- Markets received their first warning about Friday's jobs report. ADP announced that private payrolls declined by 20.2 million in the United States during April. That is the single largest drop in the history of the firm's survey. However, the figure actually beat expectations as the consensus projected a decline of 22 million. The news parallels reports that 30 million Americans have filed for unemployment over the last month. The service industry has taken the hardest hits due to social distancing guidelines. On Friday, analysts expect that the U.S. unemployment rate will surpass 16% in April, up from 4.4% in March.
- It's not just U.S. economic numbers that are troubling. The European Commission has released its latest economic forecasts for 2020 - and the numbers are rather bleak. The EU now anticipates that the continental trade bloc will see a 7.4% contraction in GDP for 2020. That would be the worst economic performance for the region since the Great Depression. The forecast comes as European nations like Germany, Greece, Spain, and Italy assess the impact of recent lockdowns and plan to reopen their economies. The Commission is currently exploring a new Recovery Fund that could surpass 1.5 trillion euros (US$1.62 trillion) in the next week.
Stocks to Watch Today: DIS, GM, CVS
Shares of Walt Disney Co. (NYSE: DIS) were off 2.1% after the iconic entertainment giant reported earnings Tuesday afternoon. The firm said that operating income from its parks and cruises plunged 58% year over year. During his first earnings call, new CEO Bob Chapek and team announced the firm's EPS of $0.60 on top of $18.01 billion in revenue. Wall Street expected earnings per share of $0.89 on top of $17.80 billion in revenue. The firm also announced plans to suspend its dividend in order to preserve $1.6 billion in cash.
- General Motors Co. (NYSE: GM) stock rallied more than 7% after the company reported a $294 million profit during the first quarter. The surprise gain came despite the ongoing COVID-19 pandemic, shuttered factories, and a big slump in sales. The company's large-scale operations in China have also been closed since December. That said, the firm announced plans to restart its U.S. production this month. It has a very strong cash position and access to credit to help it navigate a recovery.
- CVS Health Corp. (NYSE: CVS) surged after the company reported a large jump in same-store sales due to consumer stocking during the COVID-19 pandemic. The firm reported earnings per share of $1.91 on top of $66.8 billion. Both figures beat expectations. The company also held its forward guidance in line - something very few firms have done during earnings season. CVS stock added 4% this morning.
- Look for earnings reports today from Wendy's Co. (NYSE: WEN), CVS Health Corp. (NYSE: CVS), General Motors Co. (NYSE: GM), Peloton Interactive Inc. (NASDAQ: PTON), Etsy Inc. (NASDAQ: ETSY), and Lyft Inc. (NASDAQ: LYFT).
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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.