The daily business briefing: May 14, 2021
Gas crunch continues despite ramping up of pipeline, jobless claims fall to another pandemic low, and more
Panic buying continues as pipeline ramps up after cyberattack
Gas lines and panic buying continued Thursday even after Colonial Pipeline started ramping up operations again after a ransomware attack disrupted a pipeline that supplies nearly half of the East Coast's fuel. Colonial Pipeline said all markets should have begun getting some fuel during the day, but much of the Southeast continued to be plagued by panic buying that made shortages worse and left more than half of the gas stations in Georgia, Virginia, and the Carolinas without fuel. President Biden warned that hoarders would only extend the crisis, and he encouraged people to be patient, because restarting the pipeline was "not like flicking on a light switch." Colonial Pipeline reportedly paid a nearly $5 million ransom in cryptocurrency to Eastern European hackers last week to restore their system.
Jobless claims fall to another pandemic low
The number of Americans filing new applications for jobless benefits dropped to 473,000 last week, falling by 34,000 from a revised 507,000 the previous week, the Labor Department reported Thursday. The total was the latest in a series of pandemic-era lows. The data added to evidence that fewer employers are cutting jobs as coronavirus cases fall and more businesses fully reopen. The decline was the fourth in the last five weeks. The latest drop came as several states with Republican governors moved to cut off extra unemployment benefits, arguing that they were contributing to a slowdown in hiring reflected in disappointing April job gains.
Disney+ adds fewer subscribers than expected as economy reopens
Walt Disney Co. said Thursday that its Disney+ streaming service added fewer subscribers than analysts had expected in the most recent quarter, the latest sign that a video-streaming boom is easing back as coronavirus cases fall and the economy reopens. Disney+ added 8.7 million subscribers in the entertainment giant's fiscal second quarter. It now has 103.6 million subscribers. Analysts polled by FactSet had expected the service to reach 109.3 million subscribers with the help of big Marvel Studios hits. Disney shares dropped by more than 4 percent in after-hours trading. Weeks earlier, Netflix announced that its subscriber gains had slowed as COVID-19 vaccines rose and new infections fell, allowing more businesses to fully reopen.
Stock futures rise as Wall Street continues recovery from week's losses
U.S. stock index futures rose early Friday, adding to Thursday gains as Wall Street continued to climb back from sharp losses earlier in the week. Futures for the Dow Jones Industrial Average were up by 0.4 percent several hours before the opening bell. Futures for the S&P 500 and the tech-heavy Nasdaq gained 0.6 percent and 1 percent, respectively. Tech giants led the gains, with Tesla rising by 2.5 percent and Twitter gaining 2.2 percent in pre-market trading. The mood was boosted by signs that the economy was moving closer to a full reopening, including the CDC's announcement that fully vaccinated people could go without masks in most situations indoors. The Dow closed up by 1.3 percent on Thursday, while the S&P 500 and the Nasdaq rose by 1.2 percent and 0.7 percent, respectively. The three main U.S. indexes suffered heavy losses earlier in the week on rising inflation fears.
Fractured beam forces closure of crucial Mississippi River bridge
Authorities have shut down the heavily traveled Hernando de Soto Bridge over the Mississippi River indefinitely to repair a break in a critical beam. An inspector who spotted the crack immediately called 911, saying, "We need to get people off the bridge immediately!" The Interstate 40 bridge runs between Memphis, Tennessee, and Arkansas. More than 35,000 vehicles cross it daily, a third of it commercial traffic. The fracture also forced a halt to Mississippi barge traffic. The disruption could create significant supply-chain problems. "Memphis is really a nerve center of this country from a supply chain perspective," said William B. Dunavant III, CEO and president of logistics company Dunavant Enterprises. The shutdown came as President Biden and Republicans discuss competing proposals to fix the nation's aging infrastructure.