1. Dow futures extend gains after positive vaccine results
Dow futures were extending their gains and pointing to an over 700-point jump at Monday’s open after Moderna said the early-stage human trial for its coronavirus vaccine produced antibodies against Covid-19 in all 45 participants. Shares of Moderna were surging more than 30% in premarket trading. Year-to-date, the biotech’s stock soared nearly 250% as of Friday’s close.
Despite Thursday’s surge and Friday’s gain, the Dow Jones Industrial Average lost more than 2.6% last week as investors dealt with dismal economic data and increasing trade tensions between the U.S. and China over newly announced American restrictions on Chinese telecom giant Huawei.
The Nasdaq, led by the rally in tech stocks, remained positive for the year as of Friday’s close after going into the green for 2020 earlier this month. The Nasdaq has gained 35% since its March low and it’s a little more than 9% from its February record high. The Dow and S&P 500 have bounced over 30% from their March lows, but respectively remained 24% and 18% from their February all-time highs.
2. Powell sees possible GDP contraction of 30% in Q2
Federal Reserve Chairman Jerome Powell speaks to reporters after the Federal Reserve cut interest rates in an emergency move designed to shield the world’s largest economy from the impact of the coronavirus, during a news conference in Washington, March 3, 2020.
Kevin Lamarque | Reuters
The U.S. economy could shrink by upwards of 30% in the second quarter, Federal Reserve Chairman Jerome Powell told CBS’ “60 Minutes.” Powell said contraction of the economy “could easily be in the 20s or 30s.” The central bank chief said jobless numbers will look a lot like they did during the 1930s, when the unemployment rate peaked at nearly 25%. Powell cautioned that a full recovery may not happen until a coronavirus vaccine is found. However, he said the economy will avoid a depression. White House economic advisor Kevin Hassett told CNBC on Monday the Fed chief is being too pessimistic on how quickly the economy can bounce back.
3. China defends its handling of the coronavirus
The World Health Organization’s decision-making body opened a two-day virtual meeting, and Chinese President Xi Jinping on Monday called for an independent review of the global response to the coronavirus under the WHO once the pandemic is under control. Xi also defended Beijing’s handling of the outbreak, which was discovered in the Chinese city of Wuhan late last year. The meeting comes as tensions rise between the U.S. and China. Last month, President Donald Trump said Beijing should face consequences if “knowingly responsible” for the outbreak. Trump has also called for withdrawing funding for the WHO.
4. GM, Ford and Fiat Chrysler reopen U.S. auto plants
General Motors, Ford and Fiat Chrysler are reopening U.S. auto plants Monday for the first time since shuttering operations in March due to the coronavirus. The companies have rolled out a series of safety measures to protect workers, including temperature checks, personal protective equipment and deep-cleaned factory floors. Tesla restarted its plant in Fremont, California, last week.
Apple released a set of guidelines its retail stores will follow as they reopen. The tech giant said Sunday it will require customers to submit to temperature checks and wear masks before entering. Apple will provide masks. Twenty-five Apple retail stores will reopen in the U.S. this week.