In this Thursday, May 28, 2020, photo, a woman uses a smartphone on a ferry in Hong Kong. (AP Photo/Kin Cheung)
May 29, 2020
From Wall Street to Silicon Valley, these are the top stories that moved markets and had investors, business leaders, and entrepreneurs talking this week on Cheddar.
STOCKS RALLY: U.S. equity markets ended a strong week with a fizzle late Friday after President Trump’s much-awaited statement on China. While he did not signal that the U.S. was pulling out of the Phase 1 trade deal, he indicated the U.S. would rethink its "special treatment" of Hong Kong now that the region is no longer considered autonomous. During the remarks, the president also announced that the U.S. will cut ties with the World Health Organization. Despite COVID-19 deaths crossing 100,000 and civil unrest spreading across the country, major indexes closed the month of May in the green, helped by financial services stocks that had been lagging the market until recently. Indexes are going into the summer on a hot streak even as the unemployment rate in the U.S. keeps growing, with another two million workers filing for unemployment benefits last week. More than 40 million — about 1 in 4 — American workers have lost their jobs since the pandemic began.
TRUMP VS. TWITTER: President Trump signed an executive order targeting social media companies that would limit the legal protection they’re given by law. That protection allows companies like Twitter and Facebook to avoid liability from content created by their users. The order, certain to be challenged in court, comes after Twitter added fact-check notices to some of the president’s tweets on mail-in ballots. The battle between Twitter and its most high-profile user was further amplified when Twitter slapped another warning on a tweet from Trump in which he suggested that looters in Minneapolis would be shot, with the company saying the tweet violated its policy against glorifying violence. Shares of both Twitter and Facebook fell in response to the president’s order, though as a practical matter it is unlikely to change anything about how either company operates — at least for now.
MUSK GETS PAID, LOOKS TO MAKE HISTORY: When Elon Musk heads back to Cape Canaveral this weekend to watch the second launch attempt for his SpaceX rocket, he will be $775 million richer — at least on paper — than he was during the first launch attempt on Wednesday (which was scrubbed due to weather conditions). Tesla on Thursday granted Musk the first tranche of his performance-based pay in the form of stock options. Musk, who doesn’t draw a salary and has famously said he’s often “cash poor” due to his unusual compensation structure, was given another 1.7 million Tesla shares as an award for the stock hitting certain milestones. Tesla shares are back on the move after having dipped along with the broader market, bottoming out in late March. The electric car company has restarted U.S. production, but SpaceX is the Musk-run enterprise that will make headlines Saturday when it is set to become — weather permitting — the first private company to ferry humans into space.
THEME PARKS REOPENING: Disneyland, Universal Studios, Legoland, and the other big theme parks in California have been given approval to reopen in Phase 3 of the state’s reopening plan, which Gov. Gavin Newsom hinted could come as soon as next week if infection rates remain stable. In Florida, Disney said Walt Disney World will begin a phased reopening on July 11, with restrictions in place that include the mandatory wearing of masks by all visitors and staff. The majority of the Orlando theme park’s 70,000-person staff has been furloughed since March. Orlando’s other two big parks — SeaWorld and Universal — will start reopening in the next two weeks.
HBO MAX JOINS STREAMING WARS: The so-called streaming wars just got more crowded, and more competitive: AT&T’s HBO Max service launched with everything that’s on HBO plus exclusive content from WarnerMedia and DC Comics. The new service represents perhaps the biggest competitor yet to Netflix, in terms of scale and the prestige of its content offerings. It’s also the most expensive: $15 a month, though many — but not all — current HBO subscribers are eligible for a free upgrade. The upgrade process is complicated, and HBO Max remains M.I.A. on some popular streaming devices, including Amazon Fire Stick and Roku.