Stocks Are Lower Even After Best Jobs Report In The COVID Era

Plus, AstraZeneca revised the trial data of its COVID-19 vaccine following questions of accuracy in the U.S. study, JetBlue announced a new travel booking site, and Darden Restaurants delivered better-than-expected earnings results.

Stocks were lower at the open on Thursday with the Dow falling by 73 points, or 0.2%. The S&P 500 slid 0.3%, while the Nasdaq dropped 0.9%.

Stocks are lower this morning despite a better than expected jobs report. The Labor Department reported initial claims for the week ended March 20 of 684,000, marking the first reading below 700,000 in the COVID-19 era and far lower than last week’s total of 781,000. The total of those receiving benefits through all federal programs rose to nearly 19 million, though that data runs two weeks behind initial claims figures. “Claims definitely have peaked and they have been coming down, so they’re on the right path,” said Jennifer Lee, senior economist at BMO Capital Markets. Lee added that until initial claims are in the 300,000, however, “I’m not going to get overly excited.”

On the heels of the encouraging jobs report, Federal Reserve Chairman Jerome Powell said today that fiscal help from Congress combined with accelerated vaccine distribution has put the U.S. economy on a path to a faster recovery than expected. “As we make substantial further progress toward our goals, we’ll gradually roll back the amount of Treasurys and mortgage-backed securities we’ve bought,” Powell said on NPR’s “Morning Edition.” “We will very gradually over time and with great transparency, when the economy has all but fully recovered, we will be pulling back the support that we provided during emergency times.” Powell added that Fed officials have pledged to keep accommodation measures in place until the economy reaches full employment and inflation is averaging around 2%, and that the U.S is making strides in meeting those goals. “In a nutshell, it’s a combination of better developments on COVID, particularly the vaccines, and also economic support from Congress. That’s really what’s driving it,” Powell said. “That’s going to enable us to reopen the economy sooner than might have been expected.”

AstraZeneca revised the phase three trial data for its COVID-19 vaccine following questions of accuracy from its U.S. study. The pharma giant now says its vaccine is 76% effective in protecting against symptomatic cases of the coronavirus, and maintains that the shot is 100% effective at preventing severe disease and hospitalization. White House chief medical advisor Dr. Anthony Fauci said the situation with AstraZeneca was “unfortunate.” “This is really what you call an unforced error because the fact is this is very likely a very good vaccine,” Fauci said. “This kind of thing does… really cast some doubt about the vaccines and maybe contribute to the hesitancy. It was not necessary.”

JetBlue Airways announced that it has launched a new site, Paisly, where travelers can book hotel rooms, car rentals, and other add-ons, including things like tickets to theme parks. JetBlue is also planning to offer home rentals through partnerships with property managers, and will expand lodging and other offerings as it adds new cities to its network. Once travelers book their flights, JetBlue will send follow-up emails to encourage them to book lodging and other options through Paisly. “Travelers want peace of mind that their travel provider will take care of them, and that’s why Paisly is 100% backed by JetBlue and a team of real people ready to help whenever needed,” Andres Barry, president of JetBlue Travel Products, said in a press release. “Our hand-picked partners think about customer service just like we do, and are working with us to make planning a trip much simpler.”

And Darden Restaurants shares are up more than 3% this morning after the Olive Garden parent reported quarterly earnings that topped estimates. For its fiscal third quarter, Darden reported earnings per share of $0.98 on revenue of $1.73 billion, compared to estimates for earnings of $0.69 per share on revenue of $1.63 billion. Darden also said this morning that it is raising pay to hold onto its workers as bars and restaurants across the country begin a hiring spree as the coronavirus pandemic slows down. Hourly workers at its restaurants will now earn at least $10 per hour, including tips, and the rate will increase to $11 per hour in January 2022, and $12 per hour in January 2023. “Continuing to attract and retain the best talent in the industry will be critical to our success, and this commitment further solidifies our position as the employer of choice in full-service dining,” said Gene Lee, Darden’s chairman and chief executive officer.

Stocks We’re Watching

Bally’s Corporation (NYSE: BALY): Bally’s shares got a boost yesterday after the company said it reached an agreement in principle to acquire online gaming operator Gamesys. News of the deal was revealed in an 8-K filing with the SEC. “Gamesys would benefit from Bally’s fast-growing, land-based and online platform in the United States, providing market access through Bally’s operations in key states, as the nascent iGaming and sports betting opportunity develops in the U.S.,” the company said in the SEC filing. “Bally’s would benefit form Gamesys’ proven technology platform, expertise, and highly respected and experienced management team across the online gaming field. The combined group would be well-positioned to capitalize on the full range of opportunities present both in the U.S. and beyond.”