New Covid-19 infections are rising as the weather turns colder—and the stock market is paying attention.
U.S. coronavirus cases reported Tuesday hit more than 46,000, up about 21% from a week ago, while the seven-day average of new infections, which has been rising steadily since the beginning of October, sits at roughly 51,000, up almost 17% from a week ago.
To this point, more than 7.8 million Americans have become infected with Covid-19. About 3.1 million have recovered. Tragically, more than 207,000 have died. America has roughly 4.5 million active cases.
Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, warned Americans about increasing infection rates in the fall, but believes the U.S. can halt the progression. In recent months, he has consistently advocated for wearing a mask, avoiding crowds, staying outside, washing hands and maintaining six feet of social distancing where possible.
The market, however, appears to be betting on vaccines and treatments. On Tuesday, for instance, the Dow Jones Industrial Average fell 157.71 points after pauses to Johnson & Johnson and Eli Lilly trials.
That’s not a huge drop, which suggests that confidence remains high that Covid will be conquered.
Still, it never hurts to wear a mask.
*** Just five years ago, Fitbit was one of the hottest companies in tech. Now it’s hoping a sale to Google can save its business and help it compete with Apple. Listen to the latest episode of the Readback podcast here.
Big Banks Earnings Show Resilience in the Face of the Pandemic
Two of the biggest banks in the U.S. showed Tuesday that they are more than just surviving financially during the Covid-19 crisis, an indication that businesses and consumers have been able to recover some of the ground they lost in the spring.
- JPMorgan Chase released better-than-expected third quarter earnings Tuesday. Profits rose 4% compared to the same period last year on $29 billion in revenue.
- Citigroup’s results were less stellar, but still above-consensus results. It earned $1.40 a share, less than the $2.07 a share it earned during last year’s third quarter, but far better than the analyst consensus of $0.91 a share or the $0.50 is earned during the second quarter.
- Notably, while Citi set aside $2.26 billion for bad loans, that is less than it provisioned in each of the last two quarters and loan losses themselves were smaller than in the second quarter.
- Part of the reason why the banks managed to post solid results is because of the trillions of dollars in fiscal aid that lawmakers voted to pump into the economy, through direct payments, loans and grants to business, increased unemployment benefits and other measures.
What’s Next: Bank of America and Goldman Sachs reported earnings Wednesday morning, and both beat expectations. How their stocks finish the day will give a better picture of how investors perceive the sector as a whole.
Early Voting Surges With Less Than Three Weeks Left Before the Election
Voters are casting ballots early in record numbers, either by mail or in-person, as worries about waiting in crowded polling places and standing in long lines on election day caused states to greatly expand who is eligible for mail-in ballots and for more voters to request them.
- Early voting is under way in 46 states and the District of Columbia. Pennsylvania, Kentucky and Virginia have already seen more voters cast early ballots than they did during the entire 2016 presidential election, The Wall Street Journal reports.
- In some states, growing demand for mail-in ballots has been met by decisions that critics say are aimed at making voting more difficult. For instance, in Texas, an appeals court upheld Gov. Greg Abbott’s proclamation limiting ballot drop locations to one per county.
- Addressing concerns that mail-in ballots would not be delivered to election offices in time due to slow processing, Pennsylvania’s Lt. Gov. John Fetterman said those fears are misplaced because mail-in ballots only travel short distances.
- Nonetheless, glitches have been reported, including Brooklyn voters receiving mail-in ballots with return envelopes with the wrong name on them and a cut fiber-optic cable causing several Virginia state websites to crash on Tuesday, potentially limiting access to some voters on the last day to register to vote.
- President Donald Trump will hold a town-hall event in Miami on Thursday night to be broadcast on NBC, going head-to-head with former Vice President Joe Biden’s town hall in Philadelphia, which will air on ABC.
What’s Next: Early absentee voting in some battleground states like Wisconsin appears to favor Democrats, the New York Times reports. It remains to be seen if that reflects an overall shift of votes from election day or an actual increase significant enough for Democrats to carry a state President Trump won in 2016.
Eli Lilly Coronavirus Therapy Study Halted
A clinical trial of Eli Lilly’s coronavirus antibody treatment is being paused to “ensure the safety of the patients participating in this study,” the company said in a statement on Tuesday.
- Researchers were told to stop adding new volunteers to the study out of an “abundance of caution,” the New York Times reported. Lilly confirmed the report to Barron’s and said it was “supportive of the decision.”
- The trial, which is sponsored by the National Institute of Allergy and Infectious Diseases, was evaluating Lilly’s antibody treatment for Covid-19 on an undisclosed number of volunteers.
- Unlike vaccine candidates aimed at preventing Covid-19 infection in the first place, Lilly’s drug is for hospitalized patients who have already contracted the virus. In its trials, it is being compared to Gilead’s remdesivir, a promising antiviral treatment, and a placebo.
- Lilly’s announcement comes after Johnson & Johnson said Monday that it was pausing its trials of its possible Covid-19 vaccine due to one participant’s unexplained illness. The consumer products and pharma giant said that the case of the sick participant is being evaluated by independent panelists and company physicians.
What’s Next: It’s unclear when trials of Lilly’s treatment and J&J’s vaccine will restart, particularly given that the Food and Drug Administration has yet to allow trials of AstraZeneca’s possible vaccine, which were paused in September, to resume.
Apple’s 5G iPhone Is Finally Here
Apple unveiled its iPhone 12 line during a virtual event on Tuesday. The device has 5G capabilities and improved technical specs from Apple’s prior offerings.
- The iPhone 12 Mini and base iPhone 12 will start at $699 and $799, respectively. The iPhone 12 Pro and iPhone 12 Pro Max start at $999 and $1,099, respectively.
- The news was largely expected, as months of speculation from Wall Street and a few timely leaks spoiled much of the event’s surprises.
- The company did announce its own smart speaker entry, the HomePod Mini, which will integrate with other Apple devices and services. Sonos shares rose, as some investors had feared Apple might mount a more direct challenge to its devices.
- During the Apple event, Verizon Communications CEO Hans Vestberg touted his company’s 5G network, which he said covers more than 200 million people in the U.S. He said Verizon plans to have greater-capacity wireless spectrum bands it calls 5G Ultra Wideband in 60 U.S. cities by the end of the year.
What’s Next: Preorders for the iPhone 12 and iPhone 12 Pro start Oct. 16 and hit stores Oct. 23. Those looking for the iPhone 12 Mini and iPhone 12 Pro Max will need to wait until Nov. 6 to preorder ahead of a Nov. 13 release. Investors will be watching to see if the jump to 5G finally makes a compelling case for consumers to upgrade devices.
Europe Can Slap Tariffs on U.S. Goods in Boeing Subsidies Case: WTO
The World Trade Organization on Tuesday allowed the European Union to go ahead with tariffs on some $4 billion worth of U.S. goods, in retaliation for state subsidies extended to plane maker Boeing.
- The decision, which was expected, follows a similar and symmetrical WTO decision last year greenlighting U.S. tariffs on $7.5 billion worth of European imports, including French wine and Scottish whiskey, triggered by EU subsidies to Boeing competitor Airbus.
- The EU is theoretically authorized to levy tariffs on a wide range of U.S. goods, from wine to suitcases and from airplanes to dry onions.
- European Commissioner Valdis Dombrovskis said Tuesday that the EU would “much prefer not to” levy the tariff, and urged U.S. Trade Representative Robert Lighthizer to withdraw the Airbus-related sanctions.
- The trans-Atlantic dispute, which started in 2004 when the U.S. asked the WTO to rule on Airbus government subsidies, is the longest-running in the organization’s 25-year history.
What’s Next: The decision should incite both sides to settle. This should not be difficult: The tax breaks at the heart of the dispute—and in the case of Airbus, even the plane benefiting from it—no longer exist. But the subsidies row is just one element of the wider U.S.-EU trade tensions.
My parents died from the coronavirus within three weeks of each other. Their intent was to leave their house to me, and they shared this via emails and verbally to friends and family. They died without leaving a will.
There are four daughters. I paid the house off for my parents seven years ago and have paid the taxes each year since then. Two of my sisters signed over their share without incident.
One sister, however, is resistant to signing or responding. I’ve been told by an attorney she will be responsible for paying one-quarter share of the property taxes, homeowners insurance and any house-related repairs needing to be done; although not improvements.
Given that I carry 75% of the ownership as of right now, what happens if she does not pay her share of taxes, insurance, debt for repairs? Do my parents’ emails in which they expressed their wish for me to inherit their home count for anything legally?
—ML in Texas
Read The Moneyist’s response.
—Newsletter edited by Stacy Ozol, Anita Hamilton, Mary Romano, Benjamin Levisohn