Stocks close in the red despite Fed's rescue efforts: March 23, 2020

By CNN Business

Updated 5:14 p.m. ET, March 23, 2020
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3:18 p.m. ET, March 23, 2020

Fed to the rescue

From CNN Business' Anneken Tappe

The Federal Reserve's new slew of monetary stimulus measures has pushed stock futures higher -- and analysts are getting excited for a Fed that is willing to do whatever it takes.

The Federal Reserve is now throwing everything at financial markets -- essentially what is unlimited QE," wrote James Knightley, ING's chief international economist. "The fear is that if they aren't successful the strains will only exacerbate what is already a desperate economic situation."

The package of measures should help to ease financial conditions in the corporate bond market and provide a backstop to the assistance and loans that are expected to come out of Washington's stimulus package, said Michael Pearce, senior US economist at Capital Economics.

Obviously, that's encouraging, and while the Fed's actions are an enormous help, the only way the markets are going to find sustainable improvement is when the economy is allowed to come back to life, or at least there is a real path in place for how that is going to happen," said Bespoke Investment Group co-founder Paul Hickey.
9:04 a.m. ET, March 23, 2020

Boeing suspends dividend, pay for CEO and chairman

From CNN Business' Chris Isidore

Boeing (BA) is suspending its dividend for the first time nearly 80 years.

The company, which paid $4.6 billion in dividends last year even as it dealt with mounting costs from the 737 Max crisis, said it has suspended the dividend as it tries to preserve cash. The company said paid a dividend on common stock every year since 1942.

Boeing is seeking a $60 billion in government loan guarantees for aerospace makers such as it self as it tries to weather the plunge in air traffic that is likely to force airlines to delay or cancel orders for new planes.

The company also said that it would continue to refrain from share repurchases. It suspended buybacks in April because of the grounding of the 737 Max and the halt in deliveries. And it said that CEO Dave Calhoun and Chairman Larry Kellner will forgo all pay until the end of the year. Calhoun, who began the job in January, was due to receive base pay of $1.4 million and bonuses that could have taken his total compensation package up to $28 million.

8:46 a.m. ET, March 23, 2020

US stock futures bounce higher after Fed injects more stimulus

From CNN Business' David Goldman

US stock futures were down by so much that they couldn't fall any further -- literally. They were at their maximum "limit down" just a few moments ago.

Then the Fed injected a boatload of stimulus into the US economy, and stock futures are bouncing higher.

The Dow, S&P 500 and Nasdaq are now all pointing at a modestly higher open. The Dow, which is now set to gain about 300 points this morning, had been pointing at another 1,000-point drop at the open.

Oil also reversed its course and is now trading 4% higher.

8:29 a.m. ET, March 23, 2020

Papa John's is hiring 20,000 workers

From CNN Business' Jordan Valinsky

Papa John's (PZZA) is the latest US company looking for help fast. The pizza chain wants to hire 20,000 new employees for its restaurants for a variety of roles, including delivery.

The company said that in "most cases" applicants can be interviewed and start the same day.

Domino's (DPZannounced last week it was hiring 10,000 employees as people shift their eating habits to takeout or delivery amid restrictions surrounding the growing coronavirus pandemic.

8:22 a.m. ET, March 23, 2020

Fed unveils open-ended QE, promises emergency Main Street lending program

From CNN Business' Matt Egan

The Federal Reserve accelerated its coronavirus rescue Monday by announcing unlimited bond-buying, unveiling three new credit facilities and promising to launch a Main Street lending program.

The US central bank vowed to support American households and businesses, but acknowledged "our economy will face severe disruptions."

"The coronavirus pandemic is causing tremendous hardship across the United States and around the world," the Fed said in a statement.

Major steps announced include:

-Open-ended quantitative easing (QE). Just over a week ago, the Fed had set a limit of $700 billion on these bond-buying programs

-Two lending facilities to large companies: Primary Market Corporate Credit Facility (PMCCF) for new bond and loan issuance and the Secondary Market Corporate Credit Facility (SMCCF) to provide liquidity for existing corporate bonds

-Bringing back the crisis-era Term Asset-Backed Securities Loan Facility (TALF) to support the flow of credit to consumers and businesses

-Expanding the money market mutual fund liquidity facility to include wider range of municipal bonds

-Expanding the commercial paper credit facility

And the Fed said it expect to soon launch a Main Street Business Lending Program to support small and medium sized businesses.

All of this is part of the Fed's efforts to prevent a full-blown credit crisis.

8:19 a.m. ET, March 23, 2020

Unemployment rate could hit 30%, St. Louis Fed president warns

From CNN Business' Jordan Valinsky

James Bullard, the president of the Federal Reserve Bank of St. Louis, told Bloomberg that the US unemployment rate could hit 30% because of the shutdowns sparked by the coronavirus pandemic.

He also predicts a 50% drop in annualized gross domestic product in the second quarter and $2.5 trillion in lost income.

That's significantly more dire than some of the most bearish estimates from Wall Street banks, including Goldman Sachs, which predicted Monday the US economy would shrink by a rate of 33% next quarter.

Bullard said that "everything is on the table" in terms of lending programs to help save the economy.

7:37 a.m. ET, March 23, 2020

Dollar General is hiring 50,000 workers

From CNN Business' Jordan Valinsky

The "heightened demand for household essentials" sparked by the coronavirus pandemic is forcing Dollar General (DG) to hire 50,000 workers.

The retailer said in a release Monday that a "majority" of those roles will be temporary. Dollar General has 143,000 employees working at its nearly 17,000 US stores and 17 distribution centers.

Last week, Dollar Tree (DLTR), which also owns Family Dollar, announced it was hiring 25,000 workers.

7:14 a.m. ET, March 23, 2020

McDonald's shuts down all of their UK restaurants, even for takeout

From CNN Business' Hanna Ziady

McDonald's (MCD) will close their restaurants in the United Kingdom and Ireland starting Monday, including for takeout, to help limit the spread of the coronavirus.

Paul Pomroy, CEO of McDonald's UK and Ireland, said in a statement Sunday that the decision had been taken because it was "increasingly difficult" to maintain safe social distancing while operating "busy takeaway and drive thru restaurants."

McDonald's employs over 125,000 people across 1,280 restaurants in the United Kingdom, 86% of which were run by franchisees as of March 2019.

The company closed dining areas at its stores in the United States last week and urged franchisees to do the same. In several states, restaurants have been forced to do takeaway only.

Read more here.

7:05 a.m. ET, March 23, 2020

Honeywell is expanding face mask production to include N95 masks

From CNN Business' Jordan Valinsky and Adam Levine

Manufacturing giant Honeywell (HON) says it is expanding its production to make N95 face masks, a type of mask in short supply and highly requested by doctors and nurses.

"We are honored to support the U.S. government’s efforts to protect Americans with personal protective equipment made right here in the United States," said Darius Adamczyk, Honeywell chairman and chief executive officer, in a press release.

The new face mask production line will create at least 500 new jobs, the company said.

President Donald Trump praised Honeywell, saying "the outpouring from the private sectors are also extraordinary."