Plus, weekly jobless claims were lower than expected, Pfizer will provide the U.S. with 100 million additional doses of its coronavirus vaccine, and Nikola shares tanked after ending electric garbage truck deal.
Stocks were mixed to start Wednesday with the Dow adding 202 points, or 0.7%, and the S&P 500 gaining 0.5%. The Nasdaq traded just below the flatline.
President Donald Trump is threatening to derail the stimulus and omnibus funding bill passed by Congress. In a surprise video announcement posted to Twitter, Trump called the bill a “disgrace” and said it was full of “wasteful and unnecessary” items, and also demanded lawmakers increase the stimulus checks be increased from the “ridiculously low” $600 to $2,000. “I am asking Congress to amend this bill,” Trump said. “Send me a suitable bill or else the next administration will have to deliver a Covid relief package.” Democrats welcomed Trump’s demand for higher stimulus payments, and House Speaker Nancy Pelosi said the House will vote Thursday on a bill to replace the $600 checks with the $2,000 payments Trump said he wants, and urged Trump to put pressure on House Minority Leader Kevin McCarthy to agree to ask House members to unanimously pass the measure.
Weekly jobless claims rose less than expected last week, even amid a rise in COVID-19 cases across the U.S. The Labor Department reported initial claims of 803,000 for the week ended December 19, while economists had anticipated claims would rise by 888,000. In all, 20.4 million Americans were receiving some kind of unemployment benefits through December 5, the Labor Department said. “With a new [aid] bill likely to be signed with extra benefits and an extension of them in terms of time, we’ll see how people manage the job opportunities available relative to the size of these benefits,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. “For those that can’t find work, the extra claims will obviously help them. Either way, come spring and summer we hope that we’ll see a chart decline in all these numbers.” Still, Raymond James Financial chief economist Scott Brown said, “The economy is still pretty soft. The level of jobless claims suggests there’s still labor-market weakness,” while on spending, “you see the pandemic’s impact on the season: There’s less seasonal shopping than usual, there’s less seasonal travel.”
Pfizer just inked a deal to supply the U.S. with 100 million additional doses of its COVID-19 vaccine by July 2021. The agreement brings the total number of doses of the Pfizer-BioNTech vaccine to be delivered to the U.S. to 200 million, enough vaccinations for 100 million Americans. The U.S. government will pay $1.95 billion for the additional 100 million doses, bringing the total paid to Pfizer to nearly $4 billion. The U.S. also signed an agreement with Merck & Co to supply doses of an experimental COVID drug that the company gained in its recent purchase of OncoImmune. The government will fund the development, manufacturing and distribution of the drug upon emergency use authorization of the drug, Merck said in a statement. “Even with the best vaccines, we still see emergence of disease,” said Merck Chief Marketing Officer Michael Nally. “Ultimately there’s going to be a lot of people unprotected through 2021 globally, and we need other interventions to ease the pain and suffering of this pandemic.”
Nikola shares are down more than 10% this morning after the company announced that it has terminated its partnership with Republic Services to jointly develop electric garbage trucks. The decision was made after both companies “determined that the combination of the various new technologies and design concepts would result in longer than expected development time, and unexpected costs.” Nikola CEO Mark Russell said in a statement, “This was the right decision for both companies given the resources and investments required. We support and respect Republic Services’ commitment to achieving environmentally responsible, sustainable solutions for their customers.” Following the news, Wedbush analyst Dan Ives said in a note to investors, “In a nutshell, this is a ‘gut punch’ for investors that were hoping this monster order was a potential paradigm changer for Nikola and reference customer going forward.”
And Walmart shares are lower today after the Justice Department filed a civil suit against the company alleging it unlawfully dispensed controlled substances through its pharmacies, helping to fuel the opioid crisis in America. The complaint points to the role Walmart’s pharmacies may have played in the crisis by filling opioid prescriptions and by unlawfully distributing controlled substances to its more than 5,000 pharmacies during the height of the opioid crisis. “Walmart knew that its distribution centers were using an inadequate system for detecting and reporting suspicious orders,” said Jason Dunn, the U.S. attorney in Colorado. “As a result of this inadequate system, for years Walmart reported virtually no suspicious orders at all. In other words, Walmart’s pharmacies ordered opioids in a way that went essentially unmonitored and unregulated.” Walmart said in a statement, “Blaming pharmacists for not second-guessing the very doctors the Drug Enforcement Administration (DEA) approved to prescribe opioids is a transparent attempt to shift blame from DEA’s well-documented failures in keeping bad doctors from prescribing opioids in the first place.”
Stocks We’re Watching
Aemetis Inc (NASDAQ: AMTX): Aemetis shares jumped as much as 65% yesterday after the company announced that its Aemetis Properties Riverbank subsidiary has acquired approximately 20% ownership of Nevo Motors under a Strategic Electric Vehicle Production Facilities Agreement that will utilize current and future Aemetis manufacturing facilities and fueling stations, as well as renewable natural gas and renewable electricity produced by Aemetis. “Aemetis is excited to become a significant shareholder of Nevo Motors just prior to the launch of the Nevo truck product lines planned in 2021,” Eric McAfee, Chairman and CEO of Aemetis, said in a statement. “This strategic agreement utilizes the production buildings, onsite railroad, renewable electricity substation and other facilities at the140-acre, 710,000 square foot Aemetis Riverbank, California manufacturing facility, as well as other Aemetis infrastructure, renewable energy products, and expertise in renewable fuel credits and markets.”