A Covid vaccine site at Gillette Stadium in Foxborough, Mass.
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President Joe Biden wants to vaccinate 100 million people in 100 days. Big business wants to help.
On Wednesday,
Amazon.com
sent a letter to the Biden administration offering to assist with vaccine distribution and tracking for the entire nation.
Honeywell,
this past week, offered to help North Carolina speed up its pace of vaccinations.
And, frankly, the U.S. government could use the help. So far about 16.5 million Americans, or about 5% of the country, have been vaccinated, according to the Centers for Disease Control. That works out to about 460,000 people a day since
Pfizer
began shipping vaccine doses in December.
The U.S. has been improving its vaccination rate and administered roughly 900,000 doses on Jan. 20, but that’s still below Biden’s goal of 1 million people per day.
Business likely has two motivating factors, one altruistic and one, well, not. Businesses are made up of people and helping is the right thing to do. But companies desperately want to avoid another round of lockdowns—and another lost year.
Investors are betting on 2021 being the year of recovery. The
S&P 500
is up almost 40% over the past nine months, and closed at an all-time high on Wednesday. There isn’t a lot of room for another Covid hiccup.
And U.S. corporations want to do what they can to prevent one.
—Al Root
*** Join Barron’s senior managing editor Lauren R. Rublin and health-care industry reporter Josh Nathan-Kazis today at noon to discuss what’s new in health-care investing. Sign up here.
***
Biden Issues First Round of Executive Orders
President Joe Biden signed 15 executive orders and two executive actions Wednesday night on issues ranging from a mask mandate to rejoining the Paris climate accord. “I thought there’s no time to wait. Get to work immediately,” he said to reporters while seated at the Oval Office.
- To immediately address the pandemic, Biden signed an order mandating masks on federal property as well as on all planes, trains, and other transit systems between states. He also created a new office of White House Covid-19 response that reports directly to him.
- As promised during the campaign, Biden lifted the controversial ban on travel from several majority-Muslim countries that had been put in place by the Trump administration. He also ordered an end to construction of the Mexico-U.S. border wall and a moratorium on deportations.
- He is also calling for an extension of the federal eviction moratorium through March 31 and freezing student loan payments on direct federal loans through Sept. 30.
- In addition to rejoining the Paris climate accord, Biden took executive action to stop the U.S. withdrawal from the World Health Organization, reinstate rules limiting methane emissions, and revoke a permit for construction of the Keystone XL oil pipeline.
What’s Next: Biden will sign more executive orders over the next nine days of his presidency aimed at reversing a broad swath of President Trump’s policies. He is expected to turn to economic relief measures on Friday.
—Ben Walsh
***
President Biden Sends Immigration Proposal to Congress
On his first day in office, President Biden unveiled a sweeping immigration reform proposal that would offer the 11 million undocumented immigrants living in the U.S. a pathway to citizenship.
- Biden’s bill is the latest in a string of attempts to overhaul the American immigration system, which has not been significantly altered in over three decades. He had pledged as a candidate to release such a proposal on the first day of his presidency.
- The plan would set out an eight-year path to citizenship for undocumented immigrants and set up a new processing program to review applications from refugees seeking to enter the country.
- In an effort to deter border crossings, Biden’s plan calls for an increased use of technology to monitor the border. The pathway to citizenship in his plan would also only apply to immigrants already in the country at the start of this year, an attempt to deter a rapid increase in the number of illegal crossing at the U.S.-Mexico border.
- Republican Sen. Tom Cotton of Arkansas characterized the Biden plan as “total amnesty.” Sen. Chuck Grassley of Iowa, who is the ranking GOP member of the Senate Judiciary Committee, and Sen. Marco Rubio of Florida also voiced their disapproval.
What’s Next: Senate Majority Leader Chuck Schumer has said that immigration reform is “one of the most important things a Democratic Congress can do.” It is also likely to be one of the most contentious and may fall behind other items, like stimulus spending, that are considered more urgent.
—Ben Walsh
***
Europe Mulling Stringent New Travel Bans as Virus Variants Keep Spreading
European Union leaders will meet today in a video summit to discuss ways to restrict travels into the region, as new, aggressive variants of the coronavirus threaten to overwhelm many countries’ health care systems.
- EU leaders may discuss the idea of a “vaccine passport” that would allow inoculated persons to circulate freely within the union, even though many governments have already signaled they would oppose a measure they deem “discriminatory.”
- Denmark has however already started preparing such a passport, in case its citizens traveling abroad might need it in the future.
- Most governments already require a recent negative test before allowing in foreign visitors, and France or the U.K. then require a second test within days of arrival.
- Countries such as France or the Netherlands have banned all incoming visitors from the U.K., save for essential travel, on account of the highly infectious new virus variant fast spreading in Britain.
- European Commission President Ursula von der Leyen opined Wednesday that “the blanket closure of borders in this situation makes no sense,” since it harms the single market and is, according to her, less effective than targeted measures.
What’s Next: EU governments already have the powers to regulate their borders, including banning non-EU citizens from entry for health or security reasons on a temporary basis. The real question is whether the 27 member states can agree on a modicum of coordination of their pandemic travel policies.
—Pierre Briançon
***
Earnings Season Moves Into High Gear
Earnings season is in full swing as all three U.S. stock indexes had record closes on Wednesday.
-
Procter & Gamble
beat expectations for its fiscal second quarter, as the consumer staples company saw sales growth of 8%. Sales in the quarter were fueled in part by demand for high-end household products from pricey dish soap to a $300 electric toothbrush, The Wall Street Journal reported. For the full year, the company forecasts growth between 5% and 6%, up from a prior range of 4% to 5%. -
Morgan Stanley
reported full-year revenue of $48.2 billion—a record year. Its fourth-quarter earnings and revenue topped expectations, thanks to a surge in deal making and trading activity. -
United Airlines
is still struggling as travelers stay home due to the coronavirus. The company reported a net loss of $1.9 billion in the fourth quarter alone, while revenues fell 69% to $3.4 billion. United expects revenue will be down between 65% and 70% in the first quarter of this year.
What’s Next: Tech firms
IBM,
Intel,
and
Seagate Technology
all report earnings results after today’s close.
—Connor Smith
***
Luxury Stocks Gain as Chinese Demand Springs Back
Sales updates from luxury goods leaders Burberry and Compagnie Financière Richemont, which owns Cartier, have investors hoping that one of the first sectors to be severely hit by the Covid-19 pandemic has turned the corner.
-
While
Burberry’s
sales fell 9% for the quarter ending in late December, in large part because 15% of stores were closed due to Covid-19 restrictions during part of that period, sales rose 11% in the company’s Asia-Pacific region stores and were strong in mainland China—a crucial market for the company. -
Richemont
saw its holiday-quarter sales rise 5% thanks to a 25% surge in its Asia-Pacific business and a whopping 80% increase in sales in China. - The good news sent Burberry shares 3.8% higher Wednesday, while Richemont stock gained 2.8%. Shares in LVMH Moët Hennessy Louis Vuitton, Kering and Swatch all rose on the positive sentiment.
- The Covid-19 pandemic has hurt the luxury-goods business in a variety of ways, with continued travel restrictions in many parts of the world drastically cutting the number of tourists visiting high-end shops in major cities. In the last few weeks of the year, stores throughout Europe faced another wave of government-mandated closures.
What’s Next: While the recovery for luxury-goods retailers looks shaky in Europe, the industry’s reliance on China and other Asian markets should help it weather the next few months before mass vaccinations release pent-up demand throughout the continent and the U.S.
—Ben Walsh
***
How will stimulus checks affect my tax refund this year?
When Americans started filing taxes last year, unemployment was at a 50-year low, the coronavirus pandemic’s official start was two months away and some of the earliest tax filers were powered by a sense of hyper-punctuality.
This year’s tax season will start against a very different backdrop.
Approximately 18 million people are on some form of unemployment assistance and savings rates are drooping along with personal income. Between August and December, more people said it’s hard paying for usual household expenses.
Income tax refunds—and claims on missed stimulus checks—may not be a welcome surge in cash this year. They might be a financial lifeline.
Read more here.
—Andrew Keshner
***
—Newsletter edited by Stacy Ozol, Anita Hamilton, Mary Romano, Matt Bemer, Ben Levisohn
