The daily business briefing: June 2, 2020

Harold Maass
Mark Zuckerberg in NY
Drew Angerer/Getty Images

1.

Facebook employees protest handling of Trump posts

Facebook employees staged a virtual "walkout" and vented frustration via Twitter over Facebook CEO Mark Zuckerberg's decision to leave up President Trump's posts perceived as a call to shoot looters. Twitter demoted a Trump tweet that said, "when the looting starts the shooting starts," and posted a warning saying the tweet ran counter to Twitter policies against glorifying violence. Zuckerberg explained in a Friday Facebook post that he was leaving the post up because Facebook tries to "enable as much expression as possible unless it will cause imminent risk of specific harm." One of the frustrated Facebook employees, design manager Jason Stirman, said he "completely disagrees with Mark's decision to do nothing about Trump's recent posts, which clearly incite violence ... There isn't a neutral position on racism." [The Associated Press]

2.

CBO: Coronavirus to reduce economic growth by $7.9 trillion through 2030

The Congressional Budget Office on Monday released new projections on the financial fallout from the coronavirus pandemic, predicting that the economy will grow by $7.9 trillion less than previously expected over the next decade. That represents a 3 percent drop from the previous estimate. The drop reflects business closures and declines in consumer spending, although the impact will be softened by the more than $2 trillion in emergency spending approved by Congress. The report on the damage to the economy came after White House officials confirmed last week that they would not release updated economic projections this summer in an annual budget review. The pandemic drove unemployment up from 3.5 percent in February to 14.7 percent in April. [Fox News, The Washington Post]

3.

Manufacturing activity inches above 11-year low

A key indicator of U.S. manufacturing rose slightly in May, climbing above an 11-year low in the latest sign that the economy is starting to recover from the coronavirus downturn as businesses gradually reopen. The Institute for Supply Management reported Monday that its index of U.S. factory activity rose to a reading of 43.1 in May, up from 41.5 in April. Anything under 50 indicates a contraction in manufacturing. "Today's report on the manufacturing sector represents good news that hints the economy is turning the corner as the states reopened in May," said Chris Rupkey, chief economist at MUFG in New York. "It will not be a quick recovery for sure, but at least the worst is over." [Reuters]

4.

Uber, Lyft suspend services in areas under curfews

Uber and Lyft are suspending ride-sharing and food delivery services to comply with curfews imposed as protests intensify over the killing of George Floyd, an unarmed black man, in Minneapolis police custody. At least 40 cities have ordered people off the streets at night following scattered arson and looting that has occurred on the fringes of mostly peaceful protests. Uber said it was temporarily halting services in Los Angeles, Oakland, San Francisco, and parts of Minneapolis during curfew hours. Lyft said it would follow all "relevant" local guidance. Both companies announced they were making donations to civil rights organizations. [USA Today]

5.

Stocks gain as reopenings offset concerns about civil unrest

U.S. stock futures rose early Tuesday as optimism over the reopening of the economy under easing coronavirus restrictions offset concerns about widening civil unrest and protests against police brutality. Futures for the Dow Jones Industrial Average, the S&P 500, and the Nasdaq were up by about 0.6 percent several hours before the opening bell. Analysts said the protests, which have prompted retailers to close stores in some cities, could hamper markets if investors start to fear they will disrupt efforts to reopen businesses after coronavirus shutdowns. "Good news on vaccines helped stocks in May, but U.S.-China relations & civil unrest could steal the spotlight in June," Lori Calvasina, RBC's chief U.S. equity strategist, said in a note. [CNBC]