Friday, January 7, 2022
Nasdaq Sinks 1% Friday, Capping Worst Week Since Last February as Broader Market Stumbles. U.S. stocks finished lower Friday, and the Nasdaq Composite index booked its worst week since February of last year, capping a weak stretch of trading for equity benchmarks in the first week of 2022. The Dow Jones Industrial Average fell five points, or less than 0.1%, to 36,232. The S&P 500 index declined 19 points, or 0.4%, to 4677, while the Nasdaq fell 145 points, or 1%, to 14,936. For the week, the Nasdaq Composite declined 4.6% to mark its sharpest weekly slide since Feb. 26. The S&P 500 index declined 1.9%, while the Dow finished with a more modest 0.3% weekly fall.
Hiring Was Weak, but Still Expect a March Rate Hike
Hiring disappointed again in December, but the unemployment rate slid to a new pandemic low of 3.9%, reflecting an ongoing labor shortage and underscoring expectations that the Federal Reserve will lift interest rates in March.
Employers added just 199,000 jobs last month, well below the 424,000 increase economists projected and even weaker than the upwardly revised 249,000 increase in November.
But looking past the headline nonfarm payrolls number, details of the latest jobs report show a tight labor market, where wages are climbing as millions of workers remain out of the workforce. From a month earlier, average hourly earnings jumped a higher-than-expected 0.6%. As employers raise pay to recruit from a shrunken pool of candidates, economists and policy makers worry that wage inflation will set in motion the kind of wage-price spiral that defined the 1970s.
Covid Cases Are Still Rising. Here’s When They Could Peak.
The surge in cases related to the Omicron variant of Covid-19 could peak within a month in the U.S., with cases in the most impacted states starting to decline by the end of January, according to some experts.
Earlier this week, the U.S. surpassed 1 million new daily Covid-19 cases, with the seven-day average increasing by almost 100% to around 500,000 cases per day, according to Dr. Rochelle Walensky, director of the Centers for Disease Prevention and Control.
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States Could Drive Rising Prices Even Higher. Here’s How.
While the U.S. economy is expected to cool in 2022 after a pandemic resurgence, there’s a largely untapped source of hundreds of billions of dollars in potential stimulus that could keep inflation elevated for longer—and it’s sitting with state and local governments.
State budgets are flusher than ever, benefiting from a Covid-driven combination of an estimated $885 billion in direct federal stimulus, soaring tax revenue, and curbed costs as some state and local services shifted online. State and local receipts were 16% above the prepandemic trend in the third quarter of 2021, according to an analysis by the Committee for a Responsible Federal Budget. State and local noninterest spending, meanwhile, was up just 5%.
How China’s Strict Covid Policies Could Create Risks for Global Economy
As Omicron cases soar in the U.S., policy makers are following a different playbook than March 2020. That is not the case in China, where a strict zero-tolerance policy is putting cities into lockdown and creating the risk of a rippling effect through supply chains—and eventually the global economy.
In Xi’an, a northwest city bigger than New York City with about 13 million people, restrictions are leading to concerns about food shortages and drawing some to make comparisons to the lockdown in Wuhan last year. “Things are bad,” says 28-year-old teacher Li Kun. “It’s essentially impossible to enter or go out of the city, and everyone has to stay at home except for special exceptions.”
Supreme Court Hears Arguments on Biden Vaccine Mandates
The Supreme Court held a special session on Friday to consider two challenges to the Biden administration’s workplace vaccine requirements.
The first one challenges the rule that private employers can require workers to be vaccinated or wear masks on the job and submit to weekly testing, and the second challenges the administration’s rule that employees at healthcare facilities receiving Medicare and Medicaid funding must be vaccinated.
FDA Shortens Waiting Period for Moderna Covid Booster Shot to 5 Months
Americans older than 18 who received Moderna’s Covid-19 booster dose should now wait five months to get their booster, instead of six, the Food and Drug Administration said Friday.
The FDA amended Moderna’s emergency use authorization in an effort to combat the recent surge in Covid-19 cases.
Slimmer Build Back Better Bill Still Possible After Manchin Torpedoed Biden’s Social Plan
Democrats aren’t ready to declare a time of death on President Biden’s trillion-dollar spending package, even after Sen. Joe Manchin of West Virginia delivered the bill a lethal blow just days before it was to be brought to a vote.
Party leaders have signaled they are open to continue trimming down the measure, called the Build Back Better Act, to lure Manchin back to the negotiating table.
A Leftist Firebrand Is Taking Power in Chile. It’s a Red Flag for the EV Revolution.
The world needs a lot more copper and lithium for those electric vehicles we are all supposed to be driving soon. So, it’s an awkward time for the dominant copper-producing nation, and No. 2 in lithium, to lurch leftward politically.
That’s just what happened in Chile last month, when 35-year-old former campus activist Gabriel Boric was elected president. Boric ran on higher taxes and tighter environmental controls for the mining industry, and vague promises of a post-resource-dependent Chile. “Some of his circle have fundamental questions about what they call ‘extractivism,’” says Brian Winter, vice president for policy at Americas Society/Council of the Americas.
Could the U.S. See a Fourth Covid-19 Vaccine Dose? Moderna, Pfizer Say Yes.
As Israeli officials this week began rolling out a fourth dose of Pfizer‘s Covid-19 vaccine, Moderna‘s CEO drew attention late Thursday for suggesting that a second round of boosting could come to the U.S. later this year.
The growing conversation around yet another booster comes only two months after the Food and Drug Administration expanded its authorization of boosters to include all adults.
Cars Are the New Phones. Electric Vehicles Invade CES.
Cars are the new phones. Look no further than CES 2022 in Las Vegas. Many of the cool announcements at the Consumer Electronics Show are all about a cutting-edge technology: the automobile.
Take Sony. It makes movies and PlayStation gaming systems. Now it wants to make electric cars. The company showed a concept SUV at CES. For starters, showing a concept car is a very auto-show thing to do. Second, Sony isn’t a car company yet.
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