Investors pushed stock market futures higher as signs of improving relations between the U.S. and China helped push up sentiment ahead of a jobs report expected to show a historic surge in unemployment, plus stocks to watch today in the Money & Markets Opening Bell.
The Top Story
Immediately after President Donald Trump stoked the fire between the U.S. and China by stating he would launch a new round of tariffs, that initial blaze may just be smoke.
Chinese state media agency, Xinhua, reported Friday that U.S. and Chinese trade negotiators met Friday and agreed to improve the atmosphere for the implementation of the first phase of a trade deal.
While that news has pushed stock market futures higher, investors are bracing for new data that will likely show the U.S. economy lost a staggering 22 million jobs in April — which would be the steepest plunge in payrolls since the Great Depression.
Wall Street ended higher on Thursday with the Nasdaq recouping all its losses for 2020, powered by a clutch of upbeat earnings and gains for tech stocks that have proven largely resilient in the broader sell-off.
However, the S&P 500 remains about 15% below its record high with investors still fearing a deep recession due to the outbreak. On Thursday, financial markets began pricing in a negative U.S. interest rate environment for the first time ever.
Walt Disney Co. (NYSE: DIS) shares rose 2.7% as tickets for the earliest days of Shanghai Disneyland’s re-opening in China sold out rapidly.
As of 9:20 a.m. EDT, futures for the Dow Jones and S&P 500 were up about 1.2% and Nasdaq composite moved around 1% higher.
Stocks to Watch Today
Hostess Brands Inc. (Nasdaq: TWNK) — The bakery company that produces Twinkies and Dolly Madison brand snack cakes reported earning $0.14 per share in the last quarter — beating Wall Street projections by $0.01. Shares were up 8.6%, even as the company pulled its full-year guidance.
Uber Technologies Inc. (NYSE: UBER) — Shares of the ride-hailing company moved 7.6% higher in premarket trading after its food delivery service helped push revenues above analysts’ expectations. Uber posted a $3 billion loss, but that included a previously forecast write-down of $2.1 billion.
Zillow Group Inc. (Nasdaq: ZG) — The online real estate database company lost $0.26 per share for its last quarter — $0.09 smaller than expectations. It did report revenue that beat analysts’ estimates. Shares of Zillow were down 1.4% but could go anywhere during the day.
Neiman Marcus Files for Bankruptcy Protection
Nearly a century after launching its first department store in downtown Dallas, Neiman Marcus Group Inc. has filed for Chapter 11 bankruptcy protection in Texas.
While they are the largest, Neiman Marcus is one of three major retailers to file for bankruptcy this week. J.Crew Group Inc. and Canadian shoe retailer ALDO Group Inc. have also sought court restructuring, according to The Wall Street Journal.
JCPenney Co. (NYSE: JCP) missed a $17 million interest payment on Thursday, which could start the clock on the retailer becoming another to fall victim to the coronavirus lockdowns.
Small Business Loan Money Demand Eases
Nearly two weeks after the federal government pumped an additional $310 billion into its small business aid program, more than 40% of the funds remain.
According to The Wall Street Journal, some of the reasons for demand cooling is the exclusion of public companies from receiving funds and loan duplication. Another reason is that some businesses believe the Paycheck Protection Program doesn’t meet their needs.
Real Unemployment in China Could be 80 Million
There’s going to be a lot of talk today about unemployment figures in the U.S., but a report from CNN Business suggests China’s jobless situation is likely worse.
While data is hard to come by regarding things like unemployment, projections based on figures from the National Bureau of Statistics of China and the Chinese Academy of Social Sciences suggest the urban unemployment rate in China is around 5.9% and that 80 million people were out of work in March.
What We’re Reading
Your Guide to Making Money While Waiting for a Market Recovery (Money & Markets)
Angry Your Coronavirus Check Was Garnished? The IRS Aims to Fix it. (USA Today)
The 20-Year Treasury Is Coming. Is Investing in Bonds a Good Idea? (Money & Markets)
Earnings Report
Here are the companies releasing earnings reports today:
Hostess Brands Inc. (Nasdaq: TWNK)
Icahn Enterprises LP (Nasdaq: IEP)
PBF Energy Inc. (NYSE: PBF)
SeaWorld Entertainment Inc. (NYSE: SEAS)
Vector Group Ltd. (NYSE: VGR)
Check back each morning before the opening bell for stocks to watch today with Opening Bell, here on Money & Markets.