Stocks end mostly lower, even as Nasdaq tops 10,000 points
Stocks closed a choppy day on Wall Street with broad losses Wednesday, despite fresh assurances from the Federal Reserve that it would keep interest rates low through 2022 and would continue buying bonds to help markets function smoothly.
Most sectors finished lower, but a surge in technology sector stocks helped push the Nasdaq above 10,000 for the first time, giving the index its third record high close in a row. Bond yields were broadly lower, reflecting caution among investors.
The Fed has cut its benchmark shortterm rate to near zero as part of a historic effort to gird the stock market and U.S. economy from the coronavirus pandemic’s economic ravages. The central bank made clear Wednesday that it will keep providing support by buying bonds to maintain low borrowing rates. It also forecast no rate hike through 2022, which could make it easier for consumers and businesses to borrow.
The S&P 500 dropped 17.04 points, or 0.5%, to 3,190.14. The Dow Jones Industrial Average fell 282.31 points, or 1%, to 26,989.99. The Nasdaq composite gained 66.60 points, or 0.7%, to 10,020.35. Small-company stocks bore the brunt of the selling. The Russell 2000 index lost 39.66 points, or 2.6%, to 1,467.39.
Ford looks to return to pre-virus factory output levels soon
Ford expects to have its U.S. factories humming at pre-coronavirus levels by July 6.
Chief Operating Officer Jim Farley told a Deutsche Bank autos conference Wednesday that the company hit 96% of its production targets in the first three weeks after it reopened factories on May 18. Many plants reopened working two shifts and have since added production with workers on overtime. He said the company plans to go to three shifts per day at some plants.
Ford and the rest of the U.S. auto industry closed factories in mid-march when employees started catching the virus. Most reopened in May. Ford initially had trouble restarting in Chicago, Dearborn, Michigan, and Kansas City, Missouri, due to employees testing positive for the virus or due to parts shortages. But those have since subsided.
US consumer prices fall 0.1% in May, third straight drop
U.S. consumer prices dropped in May for the third straight month as the coronavirus pandemic pushed the American economy into a recession.
The Labor Department said Wednesday that its consumer price index fell 0.1% last month after tumbling 0.8% in April and 0.4% in March. Excluding food and energy prices, which bounce around from month to month, so-called core inflation fell 0.1%, falling for the third consecutive month for the first time ever.
The pandemic and the quarantines meant to contain it pushed the U.S. economy into recession. Weaker demand from customers pushes prices down.
Just Eat Takeaway says it is in talks to merge with Grubhub
Just Eat Takeaway.com says the European restaurant delivery company is in advanced talks with Grubhub for the two companies to merge.
The Amsterdam-based company said Wednesday the two companies are considering an all-stock combination. Chicago-based Grubhub did not immediately respond to a request for comment.
Just Eat Takeaway.com provides restaurant delivery services in Europe, New Zealand, Canada, Mexico and Brazil. Grubhub operates in 4,000 U.S. cities.
Ride-sharing giant Uber, which has been expanding its Eats restaurant delivery service, also is in talks to merge with Grubhub, according to published reports. That potential deal would give the companies control over a majority of the U.S. food delivery business. Uber has not commented on those reports.
Workers march after virus outbreak at Utah meat plant
Workers at a Utah a meatpacking plant and their supporters protested the company’s handling of a coronavirus outbreak that has resulted in nearly 300 confirmed cases.
JBS USA employees held a demonstration in Logan Tuesday against conditions at the plant in Hyrum.
The Bear River Health Department said 287 JBS workers tested positive for the virus at a May 30 screening.
About 100 employees walked out of the JBS parking lot Monday morning.
Workers who tested positive May 30 can return to work Wednesday if they do not have coronavirus symptoms, JBS spokesperson Nikki Richardson said. “If any team member is fearful of coming to work they can call the company and inform us, and they will receive unpaid leave.”
Gamestop sees 34% decline in sales, but online sales soar
With stores closed, Gamestop’s fiscal first-quarter sales declined 34% but its online sales skyrocketed 519% globally as customers continued to seek out video games.
In March the retailer temporarily closed all 3,526 of its U.S. locations – with approximately 65% of these locations offering limited curbside pickup. During the final six weeks of the quarter, approximately 90% of the global store fleet was closed to customers, with about 42% open for limited curbside delivery and 48% fully closed.
Gamestop said it had approximately 85% of its U.S. locations open at the end of last month, with limited customer access or curbside delivery. About 90% of its international locations opened in May. However, the company said it has since had to temporarily close approximately 100 U.S. stores due to nationwide protests. It anticipates keeping about 35 of those locations closed for the foreseeable future given extensive physical damage.