Stocks Wobble Ahead of Fed Minutes – Wall Street Journal, 4/7/2021

• U.S. stocks wobbled Wednesday as investors awaited notes from the Federal Reserve’s last policy meeting for clues on how officials view inflation and the pace of economic recovery.
• Signs that the economy is rebounding from its coronavirus-driven slump have buoyed investors and helped propel the major indexes to unprecedented levels this week.
• The rapidly progressing vaccination rollout, combined with both monetary and fiscal support, is aiding in the recovery of the labor market and the manufacturing sector.
• Money managers are betting that more of the economy will return to a normal footing soon and give a boost to travel and leisure companies.
• Some investors remain nervous that the easing of restrictions, coupled with pent-up consumer demand, could drive up inflation and prompt the Fed to raise interest rates sooner than expected.
• Investors are awaiting minutes from the central bank’s March meeting, set to be released at 2 p.m. ET. Policy makers at that time raised their forecasts for growth and inflation and reiterated that loose monetary policies would remain in place for some time.
• Bond yields have stabilized in recent days, after climbing sharply from the start of the year.
• The yield on the benchmark 10-year Treasury note ticked up to 1.659%, from 1.656% on Tuesday.
• Overseas, the pan-continental Stoxx Europe 600 gauge ticked down 0.2%.
• In Asia, most major stock indexes were mixed. Japan’s Nikkei 225 ticked 0.1% higher, while Hong Kong’s Hang Seng fell 0.9%.
• In mainland China, the Shanghai Composite Index edged down 0.1%.

Covid-19 Live Updates: New U.S. Cases Fall as Vaccine Rollout Ramps Up – Wall Street Journal, 4/7/2021

• Newly reported coronavirus cases in the U.S. declined, as President Biden moved up the timeline for broadening vaccination eligibility.
• The U.S. reported more than 61,000 new cases for Tuesday, according to data compiled by Johns Hopkins University that was published early Wednesday. The data may update later.
• Tuesday’s figure was lower than Monday’s revised tally of 77,794, when several states resumed reporting data after the Easter weekend.
• The country reported 896 Covid-19 fatalities for Tuesday, bringing the total death toll to more than 556,500, according to Johns Hopkins data.
• California plans to fully reopen its economy on June 15 assuming there is enough supply of vaccine for everyone ages 16 and older and Covid-19 hospitalizations remain low.
• At a press conference Tuesday, Gov. Gavin Newsom said getting the vaccine out quickly was the key to reopening.

EU drug regulator finds link between AstraZeneca vaccine and blood clots – Reuters, 4/7/2021

• Europe’s drug regulator on Wednesday found a possible link between AstraZeneca’s COVID-19 vaccine and rare blood clotting issues in adults who had received the shot and said it had taken into consideration all available evidence.
• “One plausible explanation for the combination of blood clots and low blood platelets is an immune response, leading to a condition similar to one seen sometimes in patients treated with heparin,” the European Medicines Agency (EMA) said.
• The findings come as a major hurdle in the global fight against the pandemic and a shift in the stance of the regulator, which had last week backed the vaccine and said there was no increased risk of blood clots in general from the shot.
• The EMA’s safety committee, which was assessing the vaccine, has requested for more studies and changes to the current ones to get more information.

Carnival Sees Cruise Bookings Surging Even With Fleet Sidelined – Bloomberg, 4/7/2021

• Carnival’s bookings are accelerating, reflecting pent-up demand for cruising even as the industry remains essentially on hold.
• In a quarterly update Wednesday, the company said booking volumes in the first quarter of 2021 were about 90% higher than in the fourth quarter of 2020.
• Cumulative advanced bookings for next year are ahead of 2019 levels.
• The Miami-based company also reported an adjusted net loss of $1.95 billion for the first quarter, wider than analysts’ expectation of $1.74 billion.

JPMorgan CEO Jamie Dimon Sees ‘Goldilocks Moment’ for U.S. Economy – Wall Street Journal, 4/7/2021

• The leader of America’s biggest bank said the U.S. economy is emerging from the coronavirus pandemic into a boom that could last until 2023.
• In his annual letter to shareholders Wednesday, JPMorgan Chase & Co. Chief Executive Jamie Dimon said strong consumer savings, expanded vaccine distribution and the Biden administration’s proposed $2.3 trillion infrastructure plan could lead to an economic “Goldilocks moment”—fast, sustained growth alongside inflation and interest rates that drift slowly upward.
• “It’s a lot of money, and it’s bound to cause a booming economy,” he said in an interview with The Wall Street Journal. “Shame on us if we don’t use that growth to help those who need it most.”
• Mr. Dimon’s outlook is decidedly rosier than it was a year ago, when he warned shareholders to brace for a “bad recession” in which U.S. gross domestic product could fall by up to 35%.
• He wrote last year’s letter just weeks after he was rushed into emergency surgery to repair a life-threatening heart injury, and the U.S. went dark to stop coronavirus from spreading.

International passenger traffic down 89% in February, no sign of recovery: IATA – Reuters, 4/7/2021

• Global airline industry body IATA said international passenger traffic plunged 89% in February compared to the same month last year as COVID-19 infections climbed once more, and there was no sign of an aviation recovery yet.
• “International passenger traffic was down almost 89% and is showing no signs of recovery in the current environment,” IATA’s new director general Willie Walsh said at a presentation on Wednesday.
• Walsh, formerly the chief executive of British Airways-parent group IAG, was holding his first media briefing since taking on the IATA director general job at the beginning of April.

GM to Make Electric Version of Chevy Silverado Pickup – Wall Street Journal, 4/7/2021

• General Motors plans to roll out an electric version of its Chevy Silverado pickup truck, the latest in its efforts to convert its global lineup to electric vehicles.
• The nation’s largest auto maker by sales has set a target date of 2035 for phasing out gasoline- and diesel-powered vehicles from its showrooms globally.
• GM plans to deliver more than one million electric vehicles across the world by 2025, the company has said.
• GM estimates the Chevy electric vehicle would have a range of more than 400 miles on a single charge, roughly matching the range a Silverado would travel on a single tank of gasoline.

Investors Big And Small Are Driving Stock Gains With Borrowed Money – Wall Street Journal, 4/7/2021

• As of late February, investors had borrowed a record $814 billion against their portfolios, according to data from the Financial Industry Regulatory Authority, Wall Street’s self-regulatory arm.
• That was up 49% from one year earlier, the fastest annual increase since 2007, during the frothy period before the 2008 financial crisis. Before that, the last time investor borrowings had grown so rapidly was during the dot-com bubble in 1999.
• FINRA’s data doesn’t break down the proportion of the margin debt held by small investors versus big ones.
• But the largest players often use other tools to amplify their bets, like derivatives.

Jeff Bezos Backs Corporate Tax-Rate Increase and Infrastructure Plan – Wall Street Journal, 4/7/2021

• Amazon.com Chief Executive Jeff Bezos said he supports a rise in the corporate tax rate and supports President Biden’s focus on major U.S. infrastructure spending.
• “We recognize this investment will require concessions from all sides—both on the specifics of what’s included as well as how it gets paid for,” Mr. Bezos wrote. He said Amazon was “supportive of a rise in the corporate tax rate” and said the company looked forward to seeing the U.S. government’s progress on the plan.
• Amazon has taken advantage of policies allowing companies to reduce their tax liability through research spending or investment in renewable energy.
• The company reported $1.8 billion in U.S. tax liability for 2020 after years of paying far less or even reporting a negative tax liability.
• Amazon had an effective income-tax rate of 9.4% for 2020, less than half the statutory corporate tax rate of 21%, according to the progressive think tank Institute on Taxation and Economic Policy.