The daily business briefing: July 20, 2021
Dow takes biggest one-day fall of 2021, Biden dials back criticism of Facebook over COVID misinformation, and more
Dow futures rise after sharpest drop since October
The Dow Jones Industrial Average plunged by 2.1 percent on Monday, its biggest drop since October, as concerns mounted over rising COVID-19 cases fueled by the spread of the highly contagious Delta variant. The S&P 500 fell by 1.6 percent and the tech-heavy Nasdaq lost 1.06 percent. The 10-year Treasury yield rose to 1.17 percent, a five-month low, as demand for safer assets increased. "You have two concerns coming together ... concerns about market technicals and concerns about growth," Allianz chief economic advisor Mohamed El-Erian told CNBC's Squawk Box. "That's what all the asset classes are telling you." Futures for the Dow, the S&P 500, and the Nasdaq all bounced back early Tuesday with gains of about 0.4 percent.
Biden tones down criticism of Facebook over COVID misinformation
President Biden dialed back his criticism of Facebook on Monday, blaming bad actors, not the social network itself, for spreading misinformation about the coronavirus and COVID-19 vaccines. Facebook got defensive after Biden last week accused Facebook of "killing people" by allowing the spreading of "outrageous misinformation." "Look," Biden said Friday, "the only pandemic we have is among the unvaccinated. And they're killing people." On Monday, he urged Facebook to do more to stamp out misinformation "instead of taking it personally." Facebook said it "permanently" bans pages, groups, and accounts that "repeatedly break our rules on COVID misinformation."
Coronavirus recession was shortest on record
The U.S. economic recession that occurred at the start of coronavirus pandemic was the shortest on record, beginning in February 2020 and lasting just two months, the Business Cycle Dating Committee of the National Bureau of Economic Research announced Monday. Previously, the shortest U.S. recession was six months, in the first half of 1980. Last year's downturn occurred as businesses nationwide closed their doors after the first wave of coronavirus cases hit the United States. Millions of Americans were laid off, and schools shifted to remote learning. The two months straddled the end of the first quarter and the beginning of the second, resulting in a 5 percent contraction in the first quarter and a whopping 31.4 percent in the second before the economy bounced back strongly.
DOJ objects to part of Purdue Pharma's bankruptcy exit plan
The Justice Department on Monday expressed "fundamental concerns" about Purdue Pharma's plan to exit Chapter 11 bankruptcy protection, which it filed for in 2019 as it faced thousands of lawsuits over its aggressive marketing of OxyContin and other opioids. The department said it backed Purdue Pharma's plan to distribute more than $4 billion to states to help deal with the opioid crisis, but opposed a proposal to shield the heirs of founders Raymond and Mortimer Sackler from more opioid lawsuits. "The proposed shareholder release violates due process principles," the Justice Department said in a statement filed with the New York bankruptcy court.
Bezos set for launch in Blue Origin spacecraft's 1st crewed flight
Blue Origin and Amazon founder Jeff Bezos is scheduled to make a suborbital space flight Tuesday in the historic first crewed mission of Blue Origin's New Shepard rocket and capsule. Bezos and a crew of three are to take off from Blue Origin's Texas facilities, which the company calls Launch Site One. The plan is for the rocket to carry the capsule on a suborbital path before separating. The crew, which includes 18-year-old Oliver Daemen, 82-year-old aviator Wally Funk, and Bezos' brother Mark Bezos, will then descend in the capsule under parachutes for a ground landing. The 11-minute trip will mark a major step in the company's space tourist program.