US stocks snap 2-day losing streak: April 2, 2020

IBM (IBM) has created a new tool within its Watson artificial intelligence system to help government agencies, health care organizations and schools field questions about coronavirus.

The tool, called Watson Assistant for Citizens, is designed to get data and information to citizens quickly -- and potentially cut down on wait times for calls to local hospitals and other authorities.

For example, the City of Lancaster in California is using the tool to answer questions from citizens about coronavirus symptoms and what to do in case of infection.

The Watson Assistant for Citizens draws guidance from national sources like the US Centers for Disease Control and Prevention, as well as from local sources for information like school closures, town news and state documents.

The tool can be deployed over the phone or online, and it uses IBM's Natural Language Processing technology to understand people's questions.

IBM is offering the Watson Assistant free for 90 days, and it's already being deployed in several US states plus the Czech Republic, Greece, Poland, Spain and the United Kingdom.

Goldman Sachs (GS) announced a $300 million coronavirus relief package to support small businesses and communities during the outbreak.

The bank will provide $250 million in low-interest emergency loans and $25 million in grants to community development financial institutions. A separate $25 million fund will support the hardest-hit communities, Goldman said in a press release.

Saudi Arabia is calling for an "urgent" meeting meeting between OPEC and other nations in hopes of reaching a production cut deal that could aid the battered oil market.

The Saudi Press Agency said in a tweet Thursday morning that the kingdom is seeking a meeting for OPEC+ states "and another group of countries" in an attempt to try to reach a "fair solution to restore a desire balance of the oil markets."

It's not clear who would be part of that additional group of countries. Since early March, Saudi Arabia and Russia have been engaged in an epic price war, flooding the market with excess oil and driving down prices.

The tweet said the invitation is part of Saudi Arabia's efforts to support the global economy "and in appreciation of the US President's request and the US friends' request."

Earlier, US oil prices spiked as much as 35% after President Donald Trump suggested Saudi Arabia and Russia could slash production by 10 million to 15 million barrels per day.

"Just spoke to my friend MBS (Crown Prince) of Saudi Arabia, who spoke with President Putin of Russia," Trump said in the tweet.

However, Dmitry Peskov, a spokesman for Russia's president, told Russian state media there was no such conversation between Putin and MBS.

US oil prices pared their gains but are still up a stunning 20% on the day.

It's been a wild morning for stocks. The major US indexes were all over the place when markets opened but are steadily rallying mid-morning.

The Dow is up 1.7%, or 350 points, while the S&P 500 is up 1.7%. The Nasdaq Composite is 1.3% higher.

Energy stocks are by far the best performing sector after oil prices jumped dramatically this morning following President Donald Trump's call for production cuts.

The S&P's top performers are all in the energy industry, and the sector is up more than 12%.

The oil market is going wild after President Donald Trump suggested Saudi Arabia and Russia could reach a truce that would slash production by 10 million barrels per day.

US crude skyrocketed as much as 35% to $27.39 a barrel Thursday morning after Trump's tweet.

"I expect & hope that they will be cutting back approximately 10 Million Barrels, and maybe substantially more which, if it happens, will be GREAT for the oil & gas industry!" Trump tweeted.

Crude was recently trading up 28% to $26 a barrel.

Oil prices crashed to 18-year lows earlier this week in part because Russia and Saudi Arabia are flooding the market with cheap oil at the worst possible time.

A deal to end that price war and instead reduce production would be a big positive for the depressed oil market.

However, it's weak demand -- not excess supply -- that's the primary cause of the oil crash. The extreme health restrictions imposed to fight the coronavirus pandemic has caused an unprecedented collapse in oil demand.

That means even if there is a truce between Saudi Arabia and Russia, oil prices could remain under pressure.

PepsiCo is adding millions of dollars to the fight against coronavirus.

The food and beverage maker announced it is setting aside a total of $45 million to fund Covid-19 relief efforts around the world.

In a written statement, Pepsi (PEP) said a total of $15.8 million will be spent on US coronavirus aid. Most of that money will fund meals for low-income children, but some will pay for protective gear for medical staffers and financial support for laid off restaurant workers.

An additional $29.2 million will go to relief efforts in Europe, Asia, Africa, and Latin America.

“We’re activating our global resources to do this now and provide other essential relief, and we will continue to do so as the world unites to tackle COVID-19,” PepsiCo Chairman & CEO Ramon Laguarta said in a written statement. 

The Federal Reserve really wants America's big banks to help fight the coronavirus crisis.

The Fed announced a rule change late Wednesday aimed at giving big banks like JPMorgan Chase (JPM), Wells Fargo (WFC) and Citigroup (C) the ability to ramp up lending and smooth out turbulence in the Treasury market.

The US central bank will now exclude US Treasuries and deposits left at the Fed from how supplementary leverage ratios are calculated.

In theory, that should give banks more flexibility to make loans and act as market makers.

Banks are getting flooded with deposits from Americans nervous about the pandemic.

That influx forces lenders to set aside ultra-safe assets they can quickly sell in case they were faced with heavy withdrawals, particularly in a bank run. And that leaves banks with less space to make much-needed loans to cash-strapped consumers and businesses.

It also limits big banks' ability to act as market makers -- a critical role given recent turmoil in the Treasury market.

"Liquidity conditions in Treasury markets have deteriorated rapidly," the Fed in a statement.

KBW analyst Brian Kleinhanzl said the rule change shows the Fed "views the largest banks as 'solutions' within the current crisis and not 'causes.'"

It was only a few days ago that the stock of Luckin Coffee (LK), China's answer to Starbucks (SBUX), was soaring on hopes that the Chinese economy was recovering.

But Luckin dropped a bomb on investors Thursday, disclosing in an SEC filing that the company was looking into possible accounting fraud that artificially lifted sales.

Making matters worse, Luckin indicated that its COO Jian Liu was involved in helping to fabricate transactions. Shares were down more than 75% in late morning trading.

Read more about the Luckin accounting probe here.

Wall Street is attempting to shrug off a startling spike in jobless claims.

US markets opened flat, traded higher and then moved into the red Thursday morning.

The very choppy action comes after a new report showed initial unemployment claims skyrocketed to record highs because of the coronavirus pandemic.

The Dow dropped 120 points, or 0.6%.

The S&P 500 fell 0.2%.

The Nasdaq lost 0.4%.

Markets were poised for a strong rally before 8:30 am ET. That's when the Labor Department said 6.6 million people filed claims for initial unemployment benefits in the week ended March 28. That shatters the previous record of 3.3 million the week before.

The dreary labor news is another reminder of the severe shock the health crisis is delivering to the American economy.