Stocks rally on Wall Street, but markets remain skittish
NEW YORK (AP) — Stocks are rallying worldwide, and Wall Street is heading for its third straight gain after U.S. retail sales rebounded last month by much more than economists were expecting.
The S&P 500 was up 1.8% in midday trading, but trading remains very skittish as coronavirus infections rise in hotspots around the world. The S&P 500 initially jumped 2.8%, but it surrendered nearly all of that at one point before rallying back.
The tenuous rise followed up on stronger gains for European and Asian stocks. Treasury yields also rose in another sign of improving optimism, but trading there was also volatile.
US retail sales up a record 17.7% in a partial rebound
WASHINGTON (AP) — U.S. retail sales jumped by a record 17.7% from April to May, with spending partially rebounding after the coronavirus had shut down businesses, flattened the economy and paralyzed consumers during the previous two months.
The Commerce Department’s report Tuesday showed that retail sales have retraced some of the record-setting month-to-month plunges of March and April as businesses have increasingly reopened.
Still, the pandemic’s damage to retail sales remains severe, with purchases still down 6.1% from a year ago.
US industrial production bounces back 1.4% in May
WASHINGTON (AP) — American industry rebounded last month as factories began to reopen after being shut down by the coronavirus lockdown in Aprll.
The Federal Reserve said Tuesday that industrIal production — including output at factories, mines and utilities — rose 1.4% in May after plummeting a record 12.4% in April.
Manufacturing output rose 3.8% But output fell 6.8% at mines and 2.3% at utilities.
Powell warns that long downturn would mean severe damage
WASHINGTON (AP) — Federal Reserve Chairman Jerome Powell says the country is facing a deep downturn with “significant uncertainty” about the timing and strength of an economic recovery. In testimony to Congress, he warned that the longer the recession lasts, the worse the damage that will be inflicted on the job market and businesses.
Powell said Tuesday that the central bank was committed to using all of its powers to cushion the economic fallout from the coronavirus but he said until the public is confident that the disease has been contained “a full recovery is unlikely.”
Powell agreed that while both Congress and the Fed have supplied record-high support, the severity of the downturn may require more.
Several Democratic senators used their questions to Powell to press for a new congressional rescue bill that would provide increased aid for state and local governments.
McDonald's worldwide sales improve as stores reopen globally
CHICAGO (AP) — McDonald’s sales are gradually improving as more of its restaurants reopen worldwide.
The Chicago-based fast food giant says global same-store sales — or sales at locations open at least a year — were down 21% in May. That was an improvement from April's 39% decline.
Ninety percent of McDonald's restaurants worldwide were open at the end of May, up from 75% at the end of April. In the U.S., where most stores remained open for drive-thru and delivery throughout the pandemic, same-store sales were down 5% in May, an improvement from a 19% decline in April.
U.S. customers are spending more per order when they visit, but traffic remains down, particularly at breakfast.
VIRUS OUTBREAK-VACCINE COVERAGE
US expects insurers to cover COVID vaccine without copays
WASHINGTON (AP) — U.S. officials say they expect health insurance companies will cover vaccines for COVID-19 without charging copays, once those vaccines are approved and become available.
At a briefing for reporters Tuesday, a senior Trump administration official said the government has been talking with insurers about offering vaccines at no cost to patients. The industry earlier made a similar commitment to cover testing for the coronavirus without charging copays.
In the case of vaccines, insurers generally have a strong financial interest to provide coverage. The Affordable Care Act also requires them to cover preventive services at no cost to patients.
Internships get canceled or go virtual because of pandemic
LONDON (AP) — Even as economies slowly reopen, the global coronavirus crisis is disrupting summer internships, an important stepping stone to working life for many university students and recent graduates.
About half of all internship openings in the U.S. have been cut since the pandemic outbreak, and even more in the U.K.
Some companies are making their internships virtual - mirroring the work-from-home trend that’s swept office life during the pandemic. But that will not be quite the same for interns, who will lack the in-person networking that can help them get jobs.
FCC calls hours-long T-Mobile service outage 'unacceptable'
NEW YORK (AP) — The head of the U.S. communications regulator said T-Mobile’s nationwide, hours-long outage Monday was “unacceptable” and that the Federal Communications Commission will investigate.
The FCC has fined telecom companies in the past for network outages.
T-Mobile, one of the country’s three largest wireless service providers, said it had a “voice and text issue” that began around noon EDT Monday. The company said at 1 a.m. Tuesday that all problems should be resolved. The company blamed an internet-traffic issue that caused problems with its network for the outage.
AT&T and Verizon said their networks were working normally.
EU authorities open twin Apple antitrust investigations
LONDON (AP) — European Union authorities have opened antitrust investigations into Apple’s App Store and its payments platform over concerns that its practices stifle competition.
The EU’s executive Commission said it launched a formal investigation of Apple Pay over allegations that the U.S. tech giant refuses access to its payment system and concerns that it limits access to the “tap and go” function on iPhones.
The Commission opened a second investigation into the mobile App Store over concerns that Apple restricts app developers from letting iPhone and iPad users know about ways to make purchases outside of apps.