Stocks Swing Lower; Trump Targets China, Social Media
Stocks traded higher for the vast majority of the trading day on Thursday, but the escalating tensions between the U.S. and China eventually got the best of investors -- stocks swung to losses in the last 45 minutes of trading as President Donald Trump prepares to make an announcement regarding China tomorrow.
The Dow Jones Industrial Average lost 147 points, or 0.6%, to finish at 25,400.
Trump moves against social media. President Trump signed an executive order on social media companies Thursday, targeting protections they enjoy that allow them to avoid liability for content posted on their sites. On Tuesday, Twitter (ticker: TWTR) for the first time included a fact-checking notice beneath several of the president's tweets, which attempted to link voting by mail to voter fraud.
TWTR was down 4.5% on Thursday, while Facebook ( FB) only ended 1.6% lower.
Some experts doubt the executive order will be enforceable. If it is, it would encourage vastly more censorship by social media companies, potentially limiting the president's ability to use Twitter in the manner he does now.
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GDP down 5% in Q1. Bleak economic numbers have been par for the course over the last few months, and that didn't change on Thursday; 2.13 million people filed for unemployment last week, higher than the 1.95 million analysts expected. In all, that means more than 40 million Americans have applied for unemployment in just 10 weeks.
A revised estimate of the U.S. gross domestic product in the first quarter also came in at -5%, worse than the 4.8% decline markets expected.
Tuesday Morning: latest Chapter 11 fatality. The pain in brick-and-mortar retail continues to mount, as discount home goods retail chain Tuesday Morning ( TUES) filed for Chapter 11 bankruptcy this week, citing the pandemic as the catalyst that made things financially unfeasible for good.
TUES is moving to close about 230 of its almost 700 locations before it attempts to re-emerge from bankruptcy later this year. Pier 1 Imports, which specialized in imported furnishings and trinkets, went bankrupt earlier this month.
It's not just home goods retailers that are struggling; Neiman Marcus and J. Crew have both filed for bankruptcy protection recently, and Ann Taylor's parent company, Ascena Retail Group ( ASNA), which boasts $5 billion in sales, is worth about $20 million according to the public markets.
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