The daily business briefing: May 18, 2020

1. Fed chair says full economic recovery could take 18 months

Federal Reserve Chair Jerome Powell said Sunday that the full recovery from lockdowns intended to slow the spread of the coronavirus could take until late 2021. "This economy will recover; it may take a while," Powell said on CBS's 60 Minutes. Powell described the crisis as the "biggest shock that the economy's had in living memory," saying the job losses and other fallout could cause the economy to shrink by 30 percent in the second quarter but would not trigger a second Great Depression. Powell has urged Congress and the White House to provide more support for individuals and businesses if the pandemic drags on. He said that the economy would recover steadily in the second half of 2020, "assuming that there's not a second wave of the coronavirus."

The New York Times CNBC

2. Judge rejects Shkreli request for prison release

A federal judge has denied disgraced pharmaceutical executive Martin Shkreli's request for release from prison to spearhead research on coronavirus treatments, The Washington Post reported on Sunday. Shkreli, widely known as "Pharma Bro," was convicted in 2017 of defrauding investors and is serving a seven-year sentence in a low-security Pennsylvania prison. He earlier gained notoriety for hiking the price of an AIDS drug by 5,000 percent. He had argued that efforts to find treatments for COVID-19 were "inadequate" and he was "one of the few executives" with the experience to develop the needed drugs. Probation department officials overseeing his case dismissed his claims as the kind of "delusional self-aggrandizing behavior" that landed him in prison.

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The Washington Post

3. Jack Ma leaves SoftBank board as company reports record loss

SoftBank on Monday announced that Alibaba co-founder Jack Ma was resigning from the Japanese conglomerate's board. The news came as SoftBank reported a record quarterly loss of $12.7 billion. Ma's departure followed the loss of another board member, Fast Retailing founder Tadashi Yanai, who left late last year to focus on his fashion business. But Ma's departure was considered particularly significant due to his close relationship to SoftBank founder and CEO Masayoshi Son, whose top-down management style has faced increasing scrutiny as SoftBank has endured three consecutive losing quarters. SoftBank did not provide details on the reasons for Ma's resignation, which came as the company plans to sell $41 billion in assets to boost its finances. The company said the latest loss was "primarily due to the impact" of the coronavirus pandemic.

Reuters CNN

4. GM plant in Mexico prepares to reopen

General Motors plans to restart its auto assembly plant in the Mexican city of Silao on May 20, Reuters reported Sunday, citing a message to workers. Workers at the plant in central Guanajuato state were previously told that their factory would reopen on May 18 after being idled for several weeks due to the coronavirus pandemic. Mexico's government said last week that it would start easing restrictions on the industry during the public health crisis. The government said that automakers would have to put safety measures in place at the plants before resuming operations. The Silao factory makes GM pickup trucks, which are among the automaker's most profitable vehicles.

Reuters

5. Stock futures rise following last week's losses

U.S. stock index futures rose early Monday despite a warning from Federal Reserve Chair Jerome Powell that a full economic rebound from the coronavirus crisis could take up to 18 months. Future for the Dow Jones Industrial Average, the S&P 500, and the Nasdaq were all up by more than 1 percent several hours before the opening bell. The Dow finished last week down by 2.7 percent, its worst week since early April. The S&P 500 lost 2.2 percent on the week after a flurry of scary economic data, including record unemployment and a 16.4 percent drop in April retail sales. European stocks gained on Monday as data showed the slowest growth rate of new coronavirus cases since late February.

CNBC MarketWatch