The daily business briefing: July 2, 2020

The Nasdaq hits a new high with a boost from vaccine hopes, Fed officials express concern about downturn's severity, and more

The Nasdaq sign
(Image credit: Spencer Platt/Getty Images)

1. Nasdaq hits record as vaccine hopes offset coronavirus fears

The S&P 500 and the Nasdaq rose on Wednesday, starting the third quarter on a high note as rising optimism about a COVID-19 vaccine offset concerns that spiking infections would result in more business-crushing lockdowns. The Nasdaq gained nearly 1 percent to set a record high, and the S&P 500 rose by 0.5 percent, while the Dow Jones Industrial Average slipped, dropping by 0.3 percent after finishing its best quarter in years after rebounding from a March coronavirus-fueled crash. Pfizer shares jumped by more than 3 percent after the drug maker said a coronavirus vaccine it is developing with German biotech firm BioNTech showed strong potential and was being tolerated by patients in early trials. Futures for all three of the main U.S. stock indexes rose early Thursday.

Reuters CNBC

2. Minutes: Fed officials concerned about coronavirus downturn's severity

Federal Reserve officials expressed concerns during their early June meeting that the coronavirus pandemic was causing an economic downturn that would be the worst since the end of World War II, according to minutes of the meeting released Wednesday. Fed policy makers also noted that the job losses triggered by the crisis were hitting the hardest among low-wage workers, women, African Americans, and Hispanics. During the meeting, Fed leaders voted unanimously to keep their benchmark interest rate at a record low near zero, where they expected to leave it through 2022. President Trump, who before the pandemic criticized Fed Chair Jerome Powell for not lowering interest rates fast enough or sharply enough, said he was "getting more and more happy" with him.

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The Associated Press

3. Jobs report expected to show record rebound in June

Economists expect the Labor Department to report Thursday that U.S. employers added 3 million jobs in June as states eased coronavirus lockdowns and started letting businesses reopen. That would be the biggest increase since the government began keeping records in 1939. Payrolls rebounded by 2.5 million in May after plummeting in April by 20.7 million, a historic gain. The latest gains come as the recovery is being threatened by a spike in new coronavirus infections underway in the South and West. The new COVID-19 surge, linked to early reopenings, prompted many states to halt or reverse their plans to let more businesses resume operations. A separate federal report is expected to show initial jobless-benefit claims fell to 1.36 million last week from 1.48 million the previous week.


4. House approves extension of Paycheck Protection Program loans

The House on Wednesday passed a bill extending the deadline for small businesses to apply for Paycheck Protection Program loans. The unanimous vote sends the bill to President Trump for his signature. The legislation will extend a key coronavirus relief program through Aug. 8. It had been slated to end June 30. The relief program offers loans to help small businesses continue to pay their employees through closures forced by coronavirus lockdowns. Congress originally allotted $349 billion for the program, but the money quickly ran out. Lawmakers then approved another $310 billion, but $130 billion still hadn't been spent by the time the program was supposed to close. Lawmakers also eased the conditions businesses need to meet to get the loans forgiven.


5. Uber extends mask requirement indefinitely

Uber Technologies announced Wednesday that it was indefinitely extending its requirement for drivers and riders to wear face coverings as part of an effort to reduce the risk of coronavirus infections. The ride-sharing service launched the policy in mid-May, initially planning to lift it at the end of June. "Extending our 'No Mask, No Ride' policy is the right thing to do," Uber said in a statement. "We want to send a clear message to everyone using Uber that we all have a role to play to keep each other safe." Uber's decision came as coronavirus cases spike in the South and West, leading some states to halt or reverse plans to reopen their economies, and an increasing number of states and cities impose orders for people to wear masks in public places.