Stocks mostly lower…Wholesale prices drop record 1.3%…Fed chair warns of a possible sustained recession
UNDATED (AP) – Most stocks are falling in morning trading on Wall Street, but more gains for technology stocks are helping to keep the market’s losses in check. The market has been wavering the last couple weeks after coming off its best month in a generation, as optimism about reopening the economy collides with worries about the dangers of lifting restrictions too soon. Most of the stocks in the S&P 500 were down after the first hour of trading, but the index was nevertheless close to flat after strength for tech stocks helped it erase an earlier loss of 1.1%.
WASHINGTON (AP) – Wholesale prices slid a record 1.3% in April, led by a 19% plunge in the cost of energy, further signaling the potential threat of deflation in the United States. The Labor Department says its producer price index, which measures inflation before it reaches the consumer, fell by the largest level on records dating to 2009. That follows a report yesterday showing consumer prices declined 0.8% in April. The decline of prices at both the retail and wholesale levels raises concerns that the seismic evaporation of demand brought on by a pandemic could ignite a destabilizing bout of deflation. That hasn’t been seen in the United States since the economic collapse of the 1930’s.
WASHINGTON (AP) – Federal Reserve Chair Jerome Powell says the threat of a prolonged recession remains. He is urging Congress and the White House to act further to prevent long-term economic damage from the viral outbreak. Both the Fed and Congress have taken dramatic steps to counter the economic downturn resulting from the widespread shutdown of the U.S. economy. But Powell says there still could be widespread bankruptcies among small business and extended unemployment for many.
GAINESVILLE, Fla. (AP) – Advice from the nation’s top disease control experts on how to safely reopen businesses and institutions in the coronavirus pandemic included detailed guidance and some more restrictive measures than the plan released by the White House last month. The guidance, which was shelved by Trump administration officials, also offered recommendations to help communities decide when to shut facilities down again during future flareups of COVID-19. The Associated Press has obtained a 63-page document that is more detailed than other, previously reported segments of the shelved guidance from the U.S. Centers for Disease Control and Prevention.
BRUSSELS (AP) – The European Union has unveiled its plan to salvage its citizens’ summer vacations and help resurrect Europe’s badly battered tourism industry. In a series of guidelines, the European Commission is laying out its advice for lifting ID checks on hastily closed borders, helping to get airlines, ferries and buses running while ensuring the safety of passengers and crew, and preparing health measures for hotels to reassure clients. But as many citizens worry about spending the vacation at home, the question remains, will the 27 member countries take the advice on board? Individual countries have the final say over health and security matters and whether the warmest months of 2020 turn into a lost summer will be up to them.