Rising Cases and Tighter Lockdowns Weigh on Markets: Live Business Updates

Credit…Paul White/Associated Press
  • After oscillating between gains and loses throughout the week, European stock markets on Friday were headed for their third consecutive week of gains. U.S. stock futures, though, were little changed after a week marred by rising virus cases leading to more lockdowns and other restrictions on economic activity in the United States. A disagreement between the Treasury Department and Federal Reserve about the future of lending programs also dampened the mood.

  • The Stoxx Europe 600 rose 0.5 percent, led higher by energy companies. The DAX in Germany rose 0.4 percent, and the CAC in France rose 0.6 percent. The Nikkei 225 in Japan closed 0.4 percent lower, and the Hang Seng Index in Hong Kong was 0.4 percent higher.

  • If the S&P 500 declines on Friday, it will pull the index into negative territory for the whole week, the first weekly decline this month. Talks over more fiscal stimulus remain stalled in Washington, but data published on Thursday showed an ominous turn in the outlook for the labor market as weekly unemployment claims rose for the first time since early October.

  • Even as virus cases rise and local restrictions are intensified, Treasury Secretary Steven Mnuchin said he did not plan to extend beyond the end of the year several emergency lending programs run by the Federal Reserve but financed with Treasury funds. Investors had expected at least some of the programs to continue into 2021 as the virus continues to pose economic risks.

  • In Europe, the picture is improving. Several large economies that instigated lockdowns and other restrictions in October are now seeing the number of new cases each day declining, including France and Spain.

  • “Volatility is still going to be with us for awhile,” said Caroline Simmons, the U.K. chief investment officer at UBS Global Wealth Management. “Markets responded very positively to the vaccine news, but some people now are taking stock and thinking, ‘What’s next? Is it all priced in?’” Ms. Simmons said she did not think future lockdowns would weigh on markets as much and the S&P 500 index could gain another 6 percent.

  • Oil prices rose with West Texas Intermediate futures increased 0.7 percent to just over $42 a barrel. Brent crude gained 1.2 percent, to about $44.72 a barrel.

Credit…Andrew Mangum for The New York Times

Roblox, a gaming site and app that has been a huge hit with tweens, revealed in an offering prospectus on Thursday that its number of users and revenue surged during the coronavirus pandemic, but that its losses deepened.

Roblox said it averaged 31.1 million daily active users in the first nine months of 2020, up 82 percent from a year earlier, as people have flocked to video games while stuck inside because of the pandemic. That helped drive Roblox’s revenue, which reached $589 million in the first nine months of the year, up 68 percent from a year ago.

Even so, the company lost money. Its net loss totaled $203 million in the first nine months of 2020, more than four times the $46 million it lost in the same period a year ago. Roblox also warned that it was unlikely to experience the same growth when the pandemic subsides, warning that the surge was “almost certainly not indicative of our financial and operating results in future periods.”

In a letter in the prospectus, David Baszucki, a Roblox founder and now its chief executive, wrote, “Our original vision to make Roblox a platform for shared experiences is now leading the way for a new category we call human co-experience.” He added, “Our vision for the future of our platform has never been more real and attainable.”

The 14-year-old company joins a flood of other tech start-ups that are moving toward the public market while the stock market remains ebullient, defying the pandemic-induced recession. In just the past 10 days, the delivery company DoorDash, the home-rental site Airbnb and the online financial services company Affirm all disclosed their initial public offering filings. Many of these companies are also losing money.

In total, 41 tech companies have gone public in the United States so far this year, raising $17.7 billion, according to Renaissance Capital.

Roblox, based in San Mateo, Calif., was founded in 2006 by Erik Cassel and Mr. Baszucki. (Mr. Cassel died of cancer in 2013.) The company has raised $335 million in funding. In its most recent financing in February, it added $150 million to its coffers and was valued at $4 billion.

The platform, which is hugely popular among children, especially those 9 to 12 years old, was growing before the pandemic but saw its growth spike once shelter-in-place orders set in. Inside the Roblox online universe, players’ avatars can interact and play millions of unique games set in different worlds, from tropical islands to haunted castles. Players pay real money for premium memberships, as well as items and clothing for their avatars.

Developers who create games for Roblox are often teenagers or young adults themselves. Those who create the most popular Roblox games can earn six-figure salaries.

Credit…Chang W. Lee/The New York Times

Thanksgiving week was shaping up to be one of the busiest periods for U.S. air travel since the pandemic brought it to a near-standstill in the spring.

But a renewed surge in virus cases and increasingly alarming warnings from public health officials are rattling travelers and threatening airlines’ hopes for the holiday weekend and the months ahead, The New York Times’s Niraj Chokshi and Ceylan Yeginsu report.

Airlines argue that flying is generally safe because of the various policies put in place to limit contagion, high-end air filtration aboard planes and the relatively few published cases of coronavirus spread in flight. But the science is far from settled, travelers are still at risk throughout their journey, and many would-be passengers have been discouraged by lockdowns and outbreaks in the places they hoped to visit.

Airlines are already noticing that prospects for passenger demand in the weeks ahead are dimming:

  • On Thursday, United said that bookings had slowed and cancellations had risen in recent days because of the surge in virus cases.

  • Southwest Airlines said last week that booking momentum seemed to be slowing for the rest of the year.

  • American Airlines, which has also seen demand dip because of the virus, has slashed December flights between the United States and Europe, leaving just two daily flights out of Dallas-Fort Worth International Airport, to London and Frankfurt.

To some extent, the unevenness of the travel recovery comes as little surprise, said Helane Becker, managing director and senior airline analyst at Cowen.

“We always knew that it would be choppy, but that said we think that people want to travel and they’re looking for ways to get out,” Ms. Becker said during a Thursday panel at the Skift Aviation Forum.

Credit…Fabio Bucciarelli for The New York Times

Anchored by Milan, Italy’s financial and fashion capital, Lombardy boasts sophisticated industry and world-class medical facilities. Yet it was overwhelmed by the first wave of the global pandemic, forcing doctors to ration ventilators and hospital beds, while having to decide who lived and who died.

The catastrophe in Italy’s most affluent region was in part a consequence of having entrusted much of the public health care system to private, profit-making companies while failing to coordinate their services, write The New York Times’s Peter S. Goodman and Gaia Pianigiani.

Over the previous quarter-century, substantial investment has flowed into lucrative specialties like cardiac surgery and oncology. Areas on the front lines of the pandemic, like family medicine and public health, have been neglected, leaving people excessively reliant on hospitals for care.

As Italy now contends with a brutal second wave, Lombardy is again near the breaking point, with three-fourths of its hospital beds occupied by Covid-19 patients — nearly double the level considered dangerous by the national Health Ministry.

“If you consider profit to be the endgame of health care instead of health, some people are going to be left out,” said Dr. Chiara Lepora, a physician for the international relief agency Doctors Without Borders who found herself pressed into service in Lombardy. “The pandemic exposes all of those weaknesses.”

Unlike the United States, where more than 30 million people lack health insurance, Europe remains a land of universally accessible, government-furnished medical care — Italy included. Yet in Lombardy, the hardest-hit region, the pandemic has revealed the pitfalls of a poorly executed push to open the system to private providers.

“Specializations such as hygiene and prevention, primary health care, outpatient clinics, infectious diseases and epidemiology have been considered not strategic assets, not sexy enough,” said Michele Usuelli, a neonatologist in Milan.

“That is why we have a health system very well prepared to treat the most complicated diseases but completely unprepared to fight something like a pandemic,” Dr. Usuelli added.

Credit…Taylor Glascock for The New York Times

A surge of Covid-19 cases this fall has brought reports of new challenges in getting coronavirus tests. But for employers, the main obstacle appears to be the cost of testing, not availability and turnaround times.

That’s the finding of a study by Arizona State University and the World Economic Forum, The New York Times’s Noam Scheiber reports.

The survey is based on responses from 1,141 facilities at more than 1,100 companies worldwide from September through late October. Here’s what it showed:

  • Over all, 17 percent of the facilities surveyed worldwide said they were testing workers. At least half of those facilities were doing so even for workers without symptoms, and roughly half were testing workers at least once a week.

  • At facilities that were not testing, only 15 percent said availability was an issue, while 28 percent cited cost, 22 percent cited complexity and 16 percent said it would take too long to receive the results. (Those surveyed could select more than one reason.)

  • Companies with 25 workers or fewer were least likely to test, with only 8 percent doing so. About 40 percent of companies with 1,001 to 5,000 workers were testing, as were nearly 60 percent of companies with more than 5,000 workers.

  • Among the biggest companies that didn’t test, cost was not a commonly cited obstacle. Those companies were much more likely to be discouraged by the complexity of testing their large work forces, which one-third cited.

  • Biotechnology and technology companies were among the most likely to test workers, with 37 percent and 29 percent doing so, even as they were among the most likely to require employees to work remotely.

  • Manufacturing was also among the industries where testing was relatively common, with 20 percent of the facilities saying they did so.

  • By contrast, only 10 percent of professional services firms, like accounting and law practices, said they were testing. And sectors in which rank-and-file workers tend to be poorly paid and can’t work from home, such as restaurants and hotels and casinos, had even lower rates.

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