The number of confirmed cases of the coronavirus that causes COVID-19 worldwide rose above 34 million on Thursday, with the U.S. accounting for about a fifth of that total, as Dr. Anthony Fauci hit back at claims made by President Donald Trump during Tuesday’s presidential debate on face masks.
Trump said Fauci, who is head of the Institute for Allergies and Infectious Diseases, said “masks are not good — and then changed his mind.” In a podcast recorded for ABC News, Fauci rebutted that claim.
“Anybody who has been listening to me over the last several months knows that a conversation does not go by where I do not strongly recommend that people wear masks,” he said. The podcast will be available in full later Thursday, according to ABC.
Fauci reminded listeners that early on in the pandemic, he and other health experts recommended against face coverings out of concern there would be a shortage of medical-grade masks for frontline workers, but later changed that view once it was clear the virus was transmissible by asymptomatic patients.
“I have been on the airways, on the radio, on TV, begging people to wear masks,” said Fauci. “And I keep talking in the context of: Wear a mask, keep physical distance, avoid crowds, wash your hands, and do things more outdoors versus indoors.”
Experts are dismayed at how face masks have become politicized during the crisis, with Trump and Vice President Mike Pence frequently appearing in public without one, and holding political rallies where few in attendance wear them, either. Trump has taunted reporters and election rival Joe Biden for wearing them.
Yet at the same time the White House is quietly encouraging state governors to implement mask mandates and even to impose fines on those who refuse to wear them, according to a report in Kaiser Health News.
On Sept. 20, the task force recommended statewide mask mandates for Iowa, Missouri and Oklahoma, according to the report, which links to weekly memos made public by the Center for Public Integrity. The task force recommended fines in Alaska, Idaho and Montana.
“At some point, we have to turn the corner on this ridiculous separation of what we’re being told is best practice and being guided by science and data, and what the actual practices are by the people who issue them,” Lori Tremmel Freeman, CEO of the National Association of County and City Health Officials, told Kaiser Health News.
Trump is planning to hold rallies in Wisconsin this weekend, even as the task force has called for increasing social distancing “to the maximal degree possible,” as new cases rise, the Washington Post reported. Two cities where the rallies are expected to take place, La Crosse and Green Bay, have been designated COVID-19 “red zones,” the paper said.
Meanwhile, House Democrats are making another push to provide a fresh round of federally funded unemployment benefits to replace the $600-a-week federal benefit that expired in July. On Monday, Democrats unveiled a scaled-down version of the HEROES Act, their proposed relief and stimulus package that passed in the House in May and was never acknowledged by Majority Leader Mitch McConnell in the Senate. Originally the package had a $3 trillion price tag. The revised version would cost $2.2 trillion.
A vote scheduled for late Wednesday was postponed until Thursday to leave time for last-ditch talks with the Trump administration. The vote comes as the Labor Department revealed that 837,000 Americans applied for jobless benefits in the latest week, in a release that did not include California, where the state has stopped accepting new claims as it investigates potential fraud.
In other news:
• A Hollywood film-industry coalition is urging Congress to come to the aid of the nation’s movie theaters amid the coronavirus crisis, or risk losing most of them, MarketWatch’s Mike Murphy reported. “Without a solution designed for their circumstances, theaters may not survive the impact of the pandemic,” the group — comprising the National Association of Theatre Owners, the Directors Guild of America, the Motion Picture Association and more than 70 film directors, producers and writers — said in a letter sent Wednesday to House and Senate leadership. Some of the most influential directors in Hollywood have joined the cause, including Oscar winners Martin Scorsese, Clint Eastwood, Alfonso Cuarón and Sofia Coppola. According to the group, 93% of U.S. movie-theater companies posted losses of 75% or more in the second quarter due to coronavirus-related closures.
• U.S. airlines are set to start furloughing workers on Thursday, after lawmakers and the White House failed to agree on a broad pandemic relief package that includes more federal aid for airlines, the Associated Press reported. American Airlines CEO Doug Parker said that if Washington comes up with a deal with $25 billion for airlines “over the next few days,” the company will reverse 19,000 furloughs set to begin Thursday and recall the workers. United said the impasse forced it to furlough 13,000 workers. United said it told leaders in the Trump administration and Congress that if payroll aid is approved in the next few days, it too could undo the furloughs. The moves by two of the nation’s four biggest airlines represent the first — and likely the largest part — of involuntary job cuts across the industry in coming days.
• Italian Prime Minister Giuseppe Conti is considering asking parliament to extend the country’s state of emergency to the end of January, as he works to avoid a fresh surge in COVID-19 cases that has been seen elsewhere in Europe, the Guardian reported. The state of emergency was due to expire in mid-October. It allows officials to avoid red tape in making decisions. Italy was an early hot spot in the pandemic, but managed to curb the spread via a strict lockdown between March and May. Italy has 314,861 confirmed cases, according to data aggregated by Johns Hopkins University, and 35,894 people have died.
• New research conducted in India found that children may play a bigger role than previously thought in spreading COVID-19 based on data gathered from contact-tracing efforts, MarketWatch’s Jaimy Lee reported. The study, published Wednesday in Science magazine, examined exposure to roughly 85,000 confirmed cases in two Indian states, where confirmed coronavirus cases skew younger than in the U.S. They found that people who had close social contact or direct physical contact to someone with COVID-19 had a 10.7% risk of transmission. That risk fell to 4.7% for lower-risk contact with infected individuals. But among children between the ages of 0 to 14 years old and their peers, and for adults older than 65 years old and their peers, there was “enhanced transmission risk.” And researchers say they found “high prevalence of infection among children who were contacts of cases around their own age.” To what degree children, especially young ones, transmit the virus is largely unclear. A study published in JAMA Pediatrics in July found that out of 132 children with mild to moderate forms of COVID-19, those younger than five years old had significantly more viral genetic material in their noses than older children and adults. In the U.S., there are 624,890 total cases of children having COVID-19, making up 10% of all. U.S. cases, as of Sept. 24, according to the Academy of American Pediatrics. Researchers for the Science study noted that most research so far has focused on higher-income regions like China, Europe, and the U.S.
The global death toll from COVID-19 stands at 1.02 million, the Johns Hopkins data show, while 23.7 million people have recovered.
The U.S. has recorded 7.3 million cases and 207,331 fatalities.
Brazil has the second highest death toll at 143,952, but third highest case tally at 4.8 million. India is second to the U.S. by case tally at 6.3 million, and has the third highest death toll at 98,678.
Mexico is fourth with 77,646 deaths and seventh with 743,216 cases.
The U.K. has 42,292 deaths and 462,774 cases, the highest death toll in Europe and fifth highest in the world.
China, where the illness was first reported late last year, has 90,555 cases and 4,739 fatalities, according to its official numbers.
What’s the latest medical news?
The U.S. Food and Drug Administration has widened its investigation into AstraZeneca’s AZN, -0.85% AZN, +0.26% COVID-19 vaccine study, according to a Reuters report, raising the prospect of further delays, MarketWatch’s Lina Saigol and Callum Keown reported from London.
AstraZeneca and its partner, the University of Oxford, voluntarily paused its Phase 3 vaccine study worldwide on Sept. 9, after a volunteer in the U.K. developed an “unexplained illness.”
Regulators in the U.K., Brazil, India and South Africa have since allowed AstraZeneca to resume its clinical trials, but the British drug maker’s late-stage U.S. trials have remained on hold. The FDA has requested further data, the Reuters report said, citing two sources. The data were expected to arrive this week, after which the agency would need time to analyze.
When the British company paused its trials, it said that unexplained illnesses can happen “by chance” in large trials and must be independently reviewed. The FDA declined to comment.
What’s the economy saying?
Outside of jobless claims, Americans ratcheted up their spending in August for the fourth month in a row, but the increase was the smallest since the U.S. economy began to reopen and pointed to a slower economic recovery, MarketWatch’s Jeffry Bartash reported.
Consumer spending rose 1% in August, the government said Thursday, matching the forecast of economists polled by MarketWatch.
Slower spending stemmed largely from the end of a massive infusion of federal aid for the unemployed. Incomes declined by 2.7%, the biggest drop since early in the pandemic.
Yet many households boosted savings early in the pandemic, giving them more cushion to spend. That’s how they managed to increase spending in August. The savings rate fell again to 14.1%, but it’s still almost twice as high as it was before the pandemic.
The return of millions of people to the workforce and the reopening of more businesses has also kept spending on the up and up.
“Despite slowing momentum, the reduction in unemployment benefits, U.S. consumers are still in decent financial shape,” said senior economist Jennifer Lee of BMO Capital Markets. “This suggests that [the third quarter] is going to be stronger than many expected.”
Separately, the Institute for Supply Management’s manufacturing index fell to 55.4% in September from 56% in August.
What are companies saying?
• Allstate Corp. ALL, -2.40% will lay off employees and close offices in a restructuring plan expected to cost the company nearly $300 million, mostly incurred in the third quarter. The goal is to increase Allstate’s share in the personal property and liability market “by expanding customer access, improving customer value and investing in marketing and technology,” the company said in a statement. Esurance and Allstate brands have merged operations, and Allstate is trying to offer “competitive” prices in auto insurance, which requires cost reductions to maintain margins, it said. About 3,800 employees, mostly in claims, sales, service and support roles, will be affected, Allstate said. “Implementing this plan is difficult as we still deal with the impact of the pandemic but necessary to provide customers the best value,” Chief Executive Tom Wilson said in a statement. The restructuring will result in charges around $290 million, with about $210 million to $220 million in the third quarter. The charges will reduce both net income and adjusted net income, and are primarily due to severance and employee benefits as well as expenses related to office closures.
• Bed Bath & Beyond Inc.’s stock BBBY, +30.40% soared 28.6% after the home goods retailer’s second-quarter earnings and sales beat expectations. Comparable sales grew for the first time since the fourth quarter of fiscal 2016, up 6%. FactSet forecast a 2.1% decline. Digital sales grew 89%. The company generated more than $750 million in cash flow, reduced debt by $500 million and brought its liquidity up to $2.2 billion through cash and a new $850 million secured asset-based lending facility. Bed Bath & Beyond didn’t provide guidance due to the ongoing uncertainty of the pandemic, but expects to achieve the goals laid out in its restructuring program, including annualized EBITDA improvement of $250 million to $350 million, excluding one-time costs, cost savings of about $100 million through the closure of 200 stores over the next two years, and about $150 million in savings from 2,800 job cuts.
• Conagra Brands Inc. CAG, -0.14% reported first-fiscal-quarter earnings that blew past expectations, buoyed by continued demand for food to eat at home. Sales rose across all segments, except food service, which fell 21.8% to $195 million. Conagra brands include Dunkin Hines, Hunt’s and Vlasic. “Now that customers have begun rebuilding inventories and we have increased production capacity in certain areas of our business, we are selectively increasing our marketing support for the businesses where capacity permits,” said Sean Connolly, chief executive of Conagra. Conagra raised its quarterly dividend 29% to $0.275 per share of common stock to be paid on Dec. 2, 2020 to stockholders of record as of the close of business on Nov. 2, 2020. For fiscal second quarter so far, Conagra says it’s seeing increased demand across retail segments and continued COVID-19–related food service declines. For the quarter, Conagra expects organic net sales growth of 6% to 8% and adjusted EPS of 70 cents to 74 cents. The FactSet consensus is for sales of $2.94 billion, suggesting 4.2% growth, and EPS of 72 cents.
• Constellation Brands Inc. STZ, -1.97% posted stronger-than-expected earnings for its second quarter, despite coronavirus-related headwinds, but declined to offer guidance given the uncertainty it has created. The company said it had net income of $512.1 million, or $2.62 a share, in the quarter to Aug. 31, after a loss of $525.2 million, or $2.77 a share, in the year-earlier period. The distributor of Corona beer said EPS including equity losses from its investment in Canadian cannabis company Canopy Growth Corp. WEED, -0.89% CGC, -0.69% came to $2.76, and excluding Canopy Growth losses came to $2.91. Sales fell 4% to $2.260 billion. The FactSet consensus was for EPS of $2.51 and sales of $2.191 billion.
•JetBlue Airways Corp. JBLU, +0.35% said the U.S. Treasury has agreed to extend loans of up to $1.14 billion until March 26, under the CARES Act, a stimulus program created during the pandemic. The airline drew down $115 million of the loan agreement on Sept. 29, JetBlue said in a regulatory filing. It has issued warrants to the Treasury to purchase 1.21 million shares, as part of the CARES Act agreement. JetBlue also received a payment of $27.1 million on Sept. 30 from the Treasury under the Payroll Support Program Agreement. The airline issued warrants for an additional 85,650 shares in return for the PSP loan.
• Marathon Petroleum Corp. MPC, -6.44% will lay off more than 2,000 employees as it looks to cut costs amid less demand for gasoline and other oil derivatives during the pandemic. The layoffs and the “indefinite” idling of the company’s refineries in Martinez, Calif., and Gallup, N.M., will affect about 2,050 employees, the company said. The layoffs and the open positions that the company decided to keep unfilled represent about 12% of its workforce, Marathon Petroleum said. Most employees will be notified on Thursday, Marathon said. The plan will result in severance charges between $125 million and $175 million in the third quarter, Marathon said.
• PepsiCo Inc. PEP, +0.82% beat earnings estimates for the third quarter. The results, coming during the pandemic, reflect the strength of the company’s snacks and food business, “and a significant improvement in our global beverage business,” Chief Executive Ramon Laguarta said in a statement. The company is now expecting full-year core EPS of about $5.50, compared with a FactSet consensus of $5.36.