The daily business briefing: October 1, 2021
Congress passes bill averting a government shutdown, stocks post worst month since March 2020, and more
Congress approves bill to avert government shutdown
Congress on Thursday approved a stopgap spending bill to keep the government funded, averting a shutdown just hours before a midnight deadline. President Biden promptly signed the legislation. The votes in the House and Senate came after Republicans blocked companion legislation seeking to raise the country's debt ceiling to prevent a potentially catastrophic default on federal debt. Democrats separated the two measures at the last minute, clearing the way for the stopgap spending bill's approval. The spending legislation keeps federal agencies funded until Dec. 3, but it leaves the question of the debt ceiling unresolved. Treasury Secretary Janet Yellen has warned lawmakers that the government will run out of ways to stave off a default by mid-October.
Stocks post biggest monthly loss since March 2020
U.S. stocks fell on Thursday, ending the last day of September with the biggest monthly loss since the plunge at the start of the coronavirus pandemic. The S&P finished September down by 4.8 percent, its first monthly loss since January and its biggest decline since March 2020. The S&P 500 fell by 1.2 percent on Thursday. The Dow Jones Industrial Average and the Nasdaq lost 1.6 percent and 0.4 percent, respectively. After months of gains in 2021, Wall Street began tumbling in recent weeks as the highly contagious Delta variant drove a coronavirus surge that disrupted the economic recovery. Futures tied to the three main U.S. averages were down another 0.5 percent several hours before the opening bell on Friday.
Zoom, Five9 scrap plans for $15 billion merger
Zoom Video Communications has scrapped its nearly $15 billion bid to acquire contact center company Five9 Inc. Five9 said Thursday in a news release that the proposed deal had been "terminated by mutual agreement" after too few shareholders backed it. Before the deal was announced in July, Zoom's stock had been soaring as it was flooded with new users for its video-conferencing platform as the pandemic forced people to work, socialize, and study from home. But its stock has fallen in the months since, so the value of the all-stock deal would have been less today. Also, Zoom last week disclosed that a U.S. Justice Department-led panel had been investigating the acquisition over concerns of potential national security risks due to Zoom's China ties.
Current, former Blue Origin employees allege sexism, safety problems
Former and current employees at Blue Origin, Amazon founder Jeff Bezos' rocket company, said in an essay released Thursday that the company has a toxic culture, including rampant sexism and intolerance of employees who contradict their bosses. The 21 employees and former employees also said in the essay published on the website Lioness that there were security concerns with the New Shepard spacecraft that Bezos and three others flew in last July. "Many of this essay's authors say they would not fly on a Blue Origin vehicle," the essay writers said. A Blue Origin spokesperson defended the company's safety record and said it has "no tolerance for discrimination or harassment of any kind."
Merck says pill cuts COVID hospitalizations in half
Merck & Co. said Friday that it would soon ask health regulators to authorize use of its experimental COVID-19 pill after early trial data showed that it reduced hospitalizations and deaths by half in patients recently infected with the coronavirus. If the drug receives approval from authorities in the United States and other countries, it will be the first pill available that has been shown to be effective in the treatment of COVID-19. Current authorized treatments require an IV or injection. Merck and its partner Ridgeback Biotherapeutics said patients who received the drug, called molnupiravir, had about half the hospitalization rate after five days as patients who got a placebo. "When you see a 50 percent reduction in hospitalization or death that's a substantial clinical impact," said Dr. Dean Li, vice president of Merck research.