The daily business briefing: May 28, 2021
Jobless claims fall to another pandemic-era low, Microsoft says SolarWinds hackers have struck again, and more
Jobless claims fall to another pandemic-era low
The number of Americans filing new claims for unemployment benefits fell to 406,000 last week, the latest in a string of pandemic-era lows. The figure was lower than the 425,000 applications economists had expected, and a big drop from the 444,000 filed the previous week. The second straight week of falling jobless claims came as more states, all run by Republican governors, have announced that they would end the extra $300 per week in enhanced federal benefits provided to help people who lost work during the coronavirus pandemic. JPMorgan economists said the ending of the unemployment insurance, set to expire in September, appeared "tied to politics, not economics," as the more than 20 states ending the benefits early are showing no signs of a tight labor market.
Microsoft: Hackers behind SolarWinds strike again
Microsoft said in a blog post Thursday that the hackers behind the massive SolarWinds data breach struck again this week, targeting 3,000 email accounts at humanitarian, international development, and other organizations. Most of the institutions hit in the latest hack by the group, which Microsoft calls "Nobelium," are based in the United States. "These attacks appear to be a continuation of multiple efforts by Nobelium to target government agencies involved in foreign policy as part of intelligence gathering efforts," the software giant said. The hackers are believed to be part of the same Russian group that breached security at nine federal agencies and 100 companies through an attack on software vendor SolarWinds.
Stock futures rise after positive employment data
U.S. stock index futures gained early Friday after encouraging hiring and inflation data boosted hopes for the economic recovery from damage caused by the coronavirus pandemic. Futures for the Dow Jones Industrial Average were up by 0.5 percent several hours before the opening bell. Futures tied to the S&P 500 and the tech-heavy Nasdaq gained 0.4 percent and 0.3 percent, respectively. The Dow rose by 0.4 percent on Thursday, and started Friday up by nearly 0.8 percent on the week. The S&P 500 gained 0.1 percent on Thursday, leaving it 1.1 percent higher on the week and less than 1 percent below a record high. The Nasdaq was flat but has gained nearly 2 percent this week.
White House set to unveil Biden's $6 trillion budget
The White House on Friday plans to unveil President Biden's $6 trillion 2022 budget plan, which will include trillions to boost the economy and social spending, The New York Times reported Thursday, citing White House documents. The budget projects spending to rise to $8.2 trillion by 2031, with a decade of trillion-dollar deficits. It reportedly does not include major initiatives that haven't been announced. It does include several big proposals he has already introduced, including his American Jobs Plan, the $1.8 trillion American Families Plan, and other discretionary spending increases. Biden already has signed a $1.9 trillion coronavirus relief package approved by Congress. The budget projects a $1.8 trillion federal deficit despite proposed tax hikes on corporations and high-income people.
AMC shares skyrocket after becoming darling of Reddit forum
Shares of AMC Entertainment jumped by as much as 47 percent on Thursday before closing up by 35.6 percent as boosters on a Reddit forum continued to push the stock higher. Shares in the movie-theater chain have risen by nearly 120 percent this week as the stock surpassed GameStop as the favorite of the WallStreetBets Reddit forum, according to a Bank of America analysis of stock mentions on the platform. One trending post in the WallStreetBets chatroom Thursday said, "AMC rocket ship." Another said, "invested all my savings into AMC!!! Wish me luck guys." The stock's rise has resulted in a $1.3 billion loss just this week for short sellers who had bet the stock would fall. AMC's revenue has plummeted due to theater closures during the coronavirus pandemic.