Business Highlights
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Stocks tumble, investors dash for cash amid recession fears
NEW YORK (AP) — Stocks tumbled more than 5% on Wall Street Wednesday and wiped out virtually all the gains for the Dow Jones Industrial Average since President Donald Trump's inauguration three years ago. Even prices for investments seen as very safe fell as the coronavirus outbreak chokes the economy and investors rush to raise cash. The Dow lost more than 1,300 points, or 6.3%, and is clinging to a 0.4% gain since Trump took the oath of office. The S&P 500 lost 5.2%. The price of oil fell 24% and dropped below $21 per barrel for the first time since 2002.
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A cruel paradox: Beating virus means causing US recession
WASHINGTON (AP) — The coronavirus is dealing a death blow to the longest U.S. economic expansion on record, triggering layoffs and putting intense strain on the financial system. In a cruel paradox, the steps needed to contain the outbreak — quarantines, travel restrictions and business closures — are bringing every day business to a halt and pushing the U.S. economy into recession for the first time since 2009. Much will depend on how swiftly and aggressively the Federal Reserve, Congress and the Trump administration deliver financial aid to tens of millions of economic victims — from hourly workers with no more income to suddenly furloughed employees to businesses with loans to pay but no customers. Solving the health crisis by shutting down the economy, though, will have to come first.
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Treasury proposal: Deliver $500B to Americans starting April
WASHINGTON (AP) — The Treasury Department wants to start issuing direct payments to Americans by early next month as the centerpiece of a $1 trillion plan to stabilize the economy amid the coronavirus epidemic. In a memorandum issued Wednesday, Treasury is calling for two $250 billion cash infusions to individuals: A first set of checks issued starting April 6, with a second wave in mid-May. The amounts would depend on income and family size. The Treasury plan, which requires approval by Congress, also recommends $50 billion to stabilize the airlines, $150 billion to issue loan guarantees to other struggling sectors, and $300 billion to for small businesses.
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Small businesses face devastation as damage from virus grows
NEW YORK (AP) — Across the country, in industries of every kind and size, the coronavirus outbreak has devastated small businesses. If they haven't been ordered to close by government officials, many are shutting down out of concern for employees, customers and clients or simply because business has vanished. Those that are still managing to operate are struggling mightily. Among the most hard-hit are restaurants, which have had to stop serving diners onsite as government officials in states, counties and cities have ordered them to close to try to contain the virus's spread.
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Coronavirus layoffs spark surge in state jobless claims
JEFFERSON CITY, Mo. (AP) — Applications for jobless benefits are surging in some states as coronavirus concerns shake the U.S. economy. The sharp increase comes as governments have ordered millions of workers, students and shoppers to stay home as a precaution against spreading the virus that causes the COVID-19 disease. In some states, the demand for help may outstrip the ability to pay claims. The U.S. Labor Department says 21 states began the year with unemployment insurance fund balances below the levels recommended to stay solvent in a recession. States are expected to get some help from the federal government.
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Automakers shut North American plants over coronavirus fears
DETROIT (AP) — Ford, General Motors, Fiat Chrysler, Honda and Toyota confirm they will temporarily shut down all of their North American factories due to the coronavirus threat. Ford said its plants will close after Thursday evening shifts, through March 30, while GM's closures will start today and take several days to finish. Closures also will last through March 30. Honda plants will close for about a week starting Monday, while Toyota will close for two days next week. The move by Detroit's three automakers will idle about 150,000 workers. They likely will receive supplemental pay in addition to state unemployment benefits. The two checks combined will about equal what the workers normally make.
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FDIC warns of scams saying banks in trouble from outbreak
NEW YORK (AP) — One of the nation's bank regulators is urging Americans not to withdraw large sums of cash and to beware of fraudsters claiming that banks are limiting customers' access to their money. The Federal Deposit Insurance Corporation issued a statement Wednesday warning about an increase in scams trying to sow distrust in the U.S. financial system while the nation is dealing with the fallout of the coronavirus pandemic. The agency says it has seen an uptick in calls, text messages, letters and emails from scammers pretending to be FDIC employees and trying to gain access to bank account and other personal information.
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The S&P 500 lost 131.09 points, or 5.2%, to close at 2,398.10. The Dow Jones Industrial Average lost 1,338.46 points, or 6.3%, to 19,898.92. The Nasdaq shed 344.94 points, or 4.7%, to 6,989.84. The Russell 2000 index of smaller-company stocks finished down 115.34 points, or 10.4%, 991.16.