Wall Street set to open higher as global markets surge.
Investors on Friday found reason to cheer despite a disastrous economic report from China, sending global markets higher and signaling the start of a strong trading day on Wall Street.
Futures for the S&P 500 were up about 3 percent. European markets were also trading 3 to 4 percent higher after an upbeat day in Asia.
Though the world economy remains under siege, investors were looking to signs of progress. Some looked to a report by the medical news website STAT that a drug from Gilead Sciences showed early — and, thus far, unproven — promise in fighting the coronavirus. According to STAT, the antiviral drug, remdesivir, has helped patients with severe symptoms recover rapidly in a clinical trial at a Chicago hospital. Boeing said it was resuming commercial plane production. China reported for the first time in decades that its economy shrank, but the number was still better than some had forecast.
In the United States, President Trump told governors on Thursday that they could begin reopening businesses in their state by May 1 or earlier.
Prices for U.S. Treasury bonds fell in early Friday trading, suggesting investors were willing to take more risks.
China’s official G.D.P. shrinks for the first time since 1976.
The coronavirus outbreak has brought China’s extraordinary, nearly half-century-long run of growth to an end — a stark reminder of the enormous task ahead for world leaders trying to restart the global economy.
China’s National Bureau of Statistics said on Friday morning that the country’s economic output shrank 6.8 percent from January through March compared to the same period last year. It’s the first economic shrinkage acknowledged in official statistics since 1976, when the country was in the final days of the Cultural Revolution, a national spasm of urban violence and torture.
The stark numbers reflect China’s dramatic efforts to stamp out the coronavirus, which included shutting down most factories and offices in January and February as the outbreak sickened tens of thousands of people.
They also illustrate how hard it will be to get the global economy back on its feet.
China is trying to restart its vast, $14 trillion economy, an effort that could give the rest of the world a much-needed shot in the arm. But the spread of the virus to Europe and the United States has sharply cut the world’s appetite for China’s goods. That could lead to factory shutdowns and worker furloughs.
Since the coronavirus outbreak reached the United States, Amazon — a company built on the promise that people will always want more items, more quickly — has struggled to respond to a surge in orders. Sometimes products are in stock. Sometimes they aren’t. Its popular page featuring Deals of the Day, once a prominent feature, has been buried. The company is even trying to tamp down demand.
For consumers, the changes have generated confusion just as people have turned more than ever to online shopping to help protect themselves from the virus. The company tells customers that some products will arrive in weeks, rather than hours or days. And the sense of endless bounty on the site has eroded.
“It is almost like a run on the bank, when there is a rumor you can’t get your money out and everyone runs to the A.T.M.,” said Guru Hariharan, whose company, CommerceIQ, advises large consumer brands with their Amazon business.
New data on Friday gave the first concrete indication of how severely European carmakers were hit by coronavirus lockdowns, and it was every bit as bad as feared.
New car registrations in the European Union fell 55 percent last month compared to a year earlier, the European Automobile Manufacturers Association said, as dealers closed their doors and buyers were stuck in their homes. Owners registered 570,000 new cars during the month, down from 1.3 million in March 2019.
Sales all but evaporated in Italy, the European country that went into lockdown the earliest, falling 85 percent. Spain and France also suffered declines of around 70 percent.
Carmakers that depend on southern Europe for sales also suffered the most. Fiat Chrysler sales plummeted 77 percent. PSA, whose brands include Peugeot, Citroën and Opel, suffered a 68 percent plunge in sales.
German carmakers BMW, Daimler and Volkswagen fared marginally better, with declines of less than 50 percent.
In a 2015 speech, Bill Gates warned that the greatest risk to humanity was not nuclear war but an infectious virus that could threaten the lives of millions of people.
That speech has resurfaced in recent weeks with 25 million new views on YouTube — but not in the way that Mr. Gates probably intended.
Anti-vaccinators, members of the conspiracy group QAnon and right-wing pundits have instead seized on the video as evidence that one of the world’s richest men planned to use a pandemic to wrest control of the global health system. Mr. Gates, 64, the Microsoft co-founder turned philanthropist, has now become the star of an explosion of conspiracy theories about the coronavirus outbreak. In posts on YouTube, Facebook and Twitter, he is being falsely portrayed as the creator of the virus, as a profiteer from a vaccine, and as part of a dastardly plot to use the illness to cull or surveil the global population.
The wild claims have gained traction with conservative pundits like Laura Ingraham and anti-vaccinators such as Robert F. Kennedy Jr. as Mr. Gates has emerged as a vocal counterweight to President Trump on the coronavirus. For weeks, Mr. Gates has appeared on TV, on op-ed pages and in Reddit forums calling for stay-at-home policies, expanded testing and vaccine development. And without naming Mr. Trump, he has criticized the president’s policies, including this week’s move to cut funding to the World Health Organization.
Three more months: That’s how long Ethiopian Airlines, Africa’s biggest and most profitable carrier, could continue functioning before seeking government support as its operations are hobbled by the coronavirus pandemic.
The airline has lost more than $500 million since January and has suspended over 90 percent of its passenger operations. But the state-owned carrier hopes to keep making money for now partly by boosting its cargo business, its chief executive officer, Tewolde GebreMariam, said in an interview on Thursday. This would include transporting goods between Africa and Europe and Asia, and distributing across Africa medical and humanitarian supplies to deal with the virus donated by the Chinese billionaire Jack Ma, United Nations agencies, and others.
But that won’t sustain the airline beyond July, Mr. Tewolde said, adding that he wasn’t certain government officials would offer financial backing given all the “pressing priorities” they had at hand.
With 85 confirmed cases and three deaths as of Thursday, Ethiopia has declared a state of emergency to fight the pandemic. About 8.5 million of the nation’s 110 million people also face severe acute food insecurity. The World Health Organization has warned Africa could be the next epicenter of the virus, with cases expected to surge to 10 million within three to six months.
Mr. Tewolde, however, remained bullish on the airline’s ability to eventually rebound, saying it hadn’t canceled any fleet orders with Boeing or Airbus. He also denied reports of furloughing staff, saying that the airline still had 14,000 employees on its payroll. “We strongly believe that short-term shocks like this should not derail us from the long-term strategy,” he said.
Cathay Pacific will lay off nearly 300 flight attendants in the United States.
In another sign of how the pandemic is ravaging the aviation sector, Hong Kong’s flag carrier said on Friday that it would lay off its U.S.-based flight attendants.
“As a result of the Covid-19 pandemic which has virtually halted global travel, Cathay Pacific has made the difficult decision to close its U.S. cabin crew bases,” the airline said in a statement, adding that it had 286 U.S.-based flight attendants working out of New York, San Francisco and Los Angeles.
The airline said on Friday that it had 13,000 flight attendants overall. It said in an annual report last year that about 78 percent of the permanent staff worldwide at Cathay Pacific and Cathay Dragon, a sister airline, were based in Hong Kong.
Last month, Cathay Pacific closed its base for cabin crew members in Vancouver, cutting 147 jobs. It said on Thursday that it had carried 90 percent fewer passengers in March compared with the same period last year.
Cathay Pacific has now grounded most of its planes, with plans to operate only 3 percent of its normal capacity through the end of the month. And from April to December, the airline said, its chairman and chief executive will take a 30 percent pay cut to their base salaries, while executive directors would take a 25 percent cut.
Boeing plans to bring about 27,000 employees back to work in Washington State to resume aircraft production, the company said on Thursday. Most will come back to work by the end of next week.
The announcement is the first attempt at large-scale resumption of business activity by a U.S. corporation since the coronavirus outbreak forced companies and government officials to shut down most nonessential work. President Trump is encouraging businesses and states to reopen the economy by May 1 or earlier.
“Following thorough reviews of local conditions, we’ve started restoring operations at some sites where work has been suspended,” Boeing’s chief executive, Dave Calhoun, said in a letter to employees ahead of the announcement. This week, the company brought about 2,500 employees in the state back to work, most of them focused on defense production operations.
Of Boeing’s approximately 160,000 employees worldwide, there are at least 66 current confirmed coronavirus infections. At least 124 others have recovered after being infected.
Boeing employees who return to work in the coming week will find new health and safety precautions in place, such as staggered start times and spread-out work areas, the company said. But a company spokesman, Charles Bickers, said Boeing would not test employees for the virus.
Catch up: Here’s what else is happening.
The movie theater chain AMC Entertainment said in a statement that it intended to raise $500 million in a private offering — squelching speculation, for now, that it will need to file for bankruptcy sooner than later.
The National Multifamily Housing Council, a trade group for big apartment owners and developers, said in a report that 16 percent of tenants failed to make a full or partial monthly rent payment by April 12, up from 9 percent in a similar period last month.
USAA, which serves military members and their families, will temporarily change its policies on overdrawn accounts to let customers collect stimulus money. The New York Times had reported that the financial services company was not allowing those customers to access the funds.
Robinhood, a stock trading app popular with young people, is in talks to raise a new round of funding led by Sequoia Capital that would value it around $8 billion, according to a person familiar with the situation.
The biotechnology company Moderna said that it had been awarded up to $483 million from the federal government to develop its coronavirus vaccine and to scale up manufacturing.
Reporting was contributed by Daisuke Wakabayashi, Davey Alba, Jack Ewing, Abdi Latif Dahir, Simon Marks, Karen Weise, Marc Tracy, Elaine Yu, Kevin McKenna, Nelson D. Schwartz, Kate Conger, Katie Thomas, Erin Griffith, Emily Flitter, Alan Rappeport, Brooks Barnes, Keith Bradsher, Niraj Chokshi, Vindu Goel, Carlos Tejada and Mike Ives. Yiwei Wang and Coral Yang contributed research.