Plus, initial jobless claims again came in above 1 million, Johnson & Johnson is launching a trial for its coronavirus vaccine candidate with 60,000 people next month, and Airbnb filed to go public.
Stocks were mixed t start Thursday with the Dow falling 23 points, or 0.1%. The S&P 500 traded just below the flatline, while the Nasdaq traded 0.2% higher.
Back above 1 million. The Labor Department reported weekly initial jobless claims for last week rose to 1.106 million, while economists had expected a reading of 923,000. “While there has been a steep decline from crisis peaks, the fact that five months into the crisis initial claims are running at 1.1 million per week is, in absolute terms, very bad news,” said Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez, Inc. The renewed increase in claims signals layoffs are on the rise at a time when Republicans and Democrats in Washington remain at a stalemate over extending the enhanced unemployment insurance passed with the CARES act, creating the potential for a sharp decline in consumer spending for August.
The U.S. and China have agreed to go back to the negotiating table in the coming days to review the progress of the “phase one” trade deal between the two, according to the Chinese commerce ministry. The world’s two largest economies had been scheduled to talk this past weekend, but the meeting was canceled by President Donald Trump who said he halted the meeting because he’s unhappy with China over its role in the COVID-19 pandemic. “I don’t want to deal with them now,” Trump said. “With what they did to this country and to the world, I don’t want to talk to China right now. While the two have agreed to meet, no exact date has been announced.
As confirmed coronavirus cases surpass 5.53 million in the U.S., Johnson & Johnson said it is planning to launch a clinical trial for its coronavirus vaccine candidate with 60,0000 people worldwide by late September. A J&J spokesperson told The Wall Street Journal that the company wants “to enroll a robust number of participants who are representative of those populations affected by COVID-19.” In New York, Governor Andrew Cuomo warned that New York City restaurants that have stayed afloat with outdoor patios and takeout services this summer that they may be forced to close in the fall as local officials struggle to enforce the state’s orders to curb the coronavirus. “We have a much, much bigger problem in New York City today than any of the surrounding suburbs with a lack of compliance,” Cuomo told reporters on a conference call. “I understand the inconvenience that many businesses are dealing with going through this. And I understand many businesses are under economic hardship and they feel that if they can’t get back to full operating that they are going to have issues.”
Lyft shares are down more than 7% this morning said it will suspend its ride share service in California at 11:59pm Pacific Time today after a court granted a preliminary injunction last week requiring it and Uber to reclassify drivers as employees. “This is not something we wanted to do,” Lyft said in a blog post, “as we know millions of Californians depend on Lyft for daily, essential trips. …For multiple years, we’ve been advocating for a path to offer benefits to drivers who use the Lyft platform—including a minimum earnings guarantee and a healthcare subsidy—while maintaining the flexibility and control that independent contractors enjoy.” Top executives at Uber and Lyft warned last week that they would likely have to suspend service in the state to comply with the court order, which would involve them restructuring their operations and re-hiring workers.
Going public. Airbnb announced that it has submitted a draft registration to the SEC for an initial public offering late yesterday. The company didn’t disclose its financial information, nor did it specify how many shares will be offered, however it has been privately valued at $31 billion. The offering comes during a difficult year for Airbnb, which has been hit hard by the coronavirus pandemic. Airbnb also announced today a global ban on all parties and events at its listings citing health reasons. “Instituting a global ban on parties and events is in the best interest of public health,” Airbnb said in a post.
Stocks We’re Watching
Akoustis Technologies Inc (NASDAQ: AKTS): Akoustis shares jumped 11% yesterday after the company introduced the first ultra-sideband 6.5 GHzXBAW filter that covers the entire U-NII-5 to U-NII-8 bands of the new WiFi 6E unlicensed spectrum. Jeff Shealy, Founder and CEO of Akoustis, said, “In anticipation of the next generation WiFi standard which promises to deliver higher data rates, we invested in the development of the industry’s first tandem ultra-wideband 5.5 and 6.5 GHz BAW-based coexistence filter solution covering the two WiFi 6E bands within the 5.1 to 7.1 GHz unlicensed spectrum. The engineering challenges in delivering these new filters include high frequency operation, ultra-wide bandwidth and high adjacent band rejection – leveraging key performance features of our XBAW™ filter technology.” Mr. Shealy continued, “The interest in WiFi 6E, and particularly in our new WiFi 6E filters, has grown dramatically over the past few months. By having the industry’s only 5.5 and 6.5 GHz tandem BAW-based filter solution, we expect that WiFi 6E will become one of our primary revenue growth drivers moving forward.”