Weekly News Summary for May 8-14, 2020

Friday, May 8, 2020: Uber Shares Up as CEO Promises More Cost Cuts

Shares in Uber Technologies Inc. rallied sharply in after-hours trading, after chief executive Dara Khosrowshahi promised to cut costs further this year to contain losses, while reassuring investors once again that the ride-hailing group would announce an operating profit in 2021.

Losses of the company grew significantly during the first quarter to $2.94 billion, as it wrote down several loss-making investments, while the 52% revenue increase in its Uber Eats business became the highlight of the report, although there were no details about whether that segment generates profit.

Monday, May 11, 2020: PBOC Looks to Deploy More Stimulus

The People’s Bank of China (PBOC) promised on Monday to deploy more powerful measure to combat the economic impact of the coronavirus, signaling the lack of substantial improvement in the issues faced by the world’s second-largest economy.

There were strong indications of officials releasing liquidity to the economy using the banking system in April, while the country also reported its first year-on-year rise in auto sales in two years last month, with total sales advancing by 5.5%.

Tuesday, May 12, 2020: US CPI Posts Biggest Drop since 2008

US core consumer prices for the month of April took their biggest dive since the Great Recession, as the economy declined from limits employed to contain the COVID-19 pandemic.

The Bureau of Labor Statistics (BLS) reported on Tuesday that the consumer price index (CPI) dropped for the second month in a row by 0.8% in April, its largest fall since December 2008, while gasoline prices slipped 20.6% to mark its biggest slump since November 2008.

Wednesday, May 13, 2020: EIA Reports Unexpected Drop in US Oil Inventories

US crude stockpiles surprisingly declined by 745,000 barrels for the week ended May 8, according to the Energy Information Administration (EIA) on Wednesday, beating forecasts for an increase of about 4.15 million barrels.

Gasoline inventories were also down by 3.5 million barrels, versus expectations for a fall of 2.2 million, while distillate stockpiles added 3.5 barrels, versus forecasts for a build of around 2.9 million barrels.

Thursday, May 14, 2020: Stocks Fall as Hopes for Economic Recovery Weaken

Stock markets stumbled and bonds turned attractive on Thursday, as concerns over a second wave of COVID-19 infections rose and as the gloomy outlook from Federal Reserve Chairman Jerome Powell weakened the prospect of a quick economic rebound.

FTSE futures and EuroSTOXX 50 futures lost around 0.5%, while the S&P 500 futures stood flat and the MSCI’s broadest index of Asia-Pacific shares outside Japan were down 1%, whereas the US bonds and the greenback rallied after Powell talked down the possibility of negative interest rates.