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The daily business briefing: April 20, 2020

Table of Contents

1.

U.S. crude oil prices fell sharply early Monday as concerns mounted over falling demand due to the coronavirus pandemic. The price of May contracts for the U.S. benchmark West Texas Intermediate plunged by 19 percent to $14.80 per barrel in Asia trading. At one point it was down to $14.47 per barrel, its lowest point since 1999. International benchmark Brent crude futures were down by 2.8 percent to $27.28 per barrel. One problem for oil is that many storage facilities have filled up as coronavirus shutdowns drive down demand. “For oil there is a bit of a technical story (with storage), but still, if energy consumption is down 30 percent and OPEC reduces supply by 10 percent, there is still a large gap,” said Rabobank head of macro strategy Elwin de Groot. [CNBC, Reuters]

2.

Protesters held a second day of weekend rallies on Sunday to call for reopening the U.S. economy despite the ongoing coronavirus outbreak. In Arizona’s capital city of Phoenix, hundreds of cars cruised past the Arizona State Capitol honking horns and waving flags in a demonstration called by Operation Gridlock Arizona to demand that state leaders lift a shelter-in-place order and let people return to work. Protesters have held similar events in Michigan, Texas, Wisconsin, and Nevada, even as the U.S. death toll continued to climb. President Trump, who was asked Sunday whether he was inciting violence by encouraging people to “liberate” their states, said that people who are calling on state governments to lift coronavirus stay-at-home orders were “good people” who have “cabin fever” and “want their life back.” [ABC15, Business Insider]

3.

U.S. stock index futures fell early Monday as investors focused on plunging oil prices and developments in the coronavirus crisis. Futures for the Dow Jones Industrial Average and the S&P 500 were down by more than 1 percent several hours before the opening bell. The market rose last week, capping its first back-to-back weekly gains in more than two months with help from a report that coronavirus patients in a trial were recovering after being given an experimental Gilead Sciences drug called remdesivir. The Dow and the S&P are now up by 30 percent from their March lows. New York Gov. Andrew Cuomo (D) said Sunday that his state, the epicenter of the outbreak in the United States, is “past the high point” of new cases, and this week will roll out antibody testing seen as a key step toward reopening businesses. [CNBC]

4.

Shake Shack said Monday that it had secured new funding and planned to return the $10 million paycheck protection loan it received under the federal coronavirus relief law, the CARES Act. The burger chain has laid off or furloughed hundreds of employees as stay-at-home orders intended to curb the spread of the outbreak kept customers away. But in a statement released Monday, CEO Randy Garutti and founder Danny Meyer said the company is “fortunate to now have access to capital that others do not. Until every restaurant that needs it has had the same opportunity to receive assistance, we’re returning ours.” [The Associated Press]

5.

The Trump administration said Sunday that it would let companies delay import tariff payments for 90 days, provided they can “demonstrate a significant financial hardship” from the coronavirus pandemic. The relief affects goods coming into the United States in March and April. The plan fell short of the across-the-board tariff relief U.S. importers were seeking. President Trump’s new tariffs on Chinese goods will remain in place, as will his levies on steel and aluminum imports. The coronavirus pandemic has shut down businesses and put millions of Americans out of work. Trump signed an executive order allowing the deferred tariff payments to “protect American jobs and help these businesses get through this time,” Treasury Secretary Steven Mnuchin said in a statement. [The Wall Street Journal, South China Morning Post]

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