Unemployment, Coronavirus, Bed Bath & Beyond - 5 Things You Must Know Thursday

Investors weigh the continued reopening of the economy against a steady increase in U.S. coronavirus infections; another 1.38 million more Americans are expected to file for unemployment benefits; Bed Bath & Beyond to close 200 stores.
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Here are five things you must know for Thursday, July 9:

1. -- Stock Futures Mixed Amid Record Virus Spike

Stock futures pointed to a mixed start for Wall Street Thursday as investors weighed the continued reopening of the economy against a steady increase in U.S. coronavirus infections.

Contracts linked to the Dow Jones Industrial Average fell 84 points, futures for the S&P 500 declined 4 points and Nasdaq futures rose 35 points.

Stocks finished higher Wednesday, rising for the sixth day out of the last seven, though persistent concerns remain that the coronavirus outbreak could stall the economy's rebound.

The tech sector has been the standout, with the Nasdaq closing at a record high Wednesday of 10,492. Shares of Amazon  (AMZN) - Get Report, Apple  (AAPL) - Get Report and Microsoft  (MSFT) - Get Report have been leading the charge.

The gains have come despite the United States setting another record for new coronavirus cases on Wednesday, with more than 59,400 infections announced, according to a database compiled by The New York Times. It was the fifth national record set in nine days.

The U.S. has more than 3 million confirmed cases of the virus, according to Johns Hopkins University, and deaths have risen to more than 132,000, the most in the world.

“I would characterize the stock market as relatively immune to the [health] crisis,” Gregory Perdon, co-chief investment officer at U.K. private bank Arbuthnot Latham, told The Wall Street Journal. He added that stimulus efforts by central banks and governments have continued to support stocks.

2 -- 1.38 Million More Americans Expected to File for Unemployment Benefits

The economic calendar Thursday includes weekly jobless claims, which have decelerated for 13 consecutive weeks but remain over 1 million. Economists expect the number of Americans filing for first-time unemployment benefits was 1.375 million in the week ended July 4, vs. 1.427 million in the previous week.

More than 48 million Americans have filed for unemployment benefits since mid-March when the coronavirus pandemic began forcing stores and restaurants to close and states went into lockdown..

Walgreens Boots Alliance  (WBA) - Get Report reported weaker-than-expected third-quarter earnings and suspended its share buyback program as stay-at-home orders in key markets around the world hit the drugstore chain's top and bottom line.

3. -- Google Abandons China Cloud Project

Alphabet's  (GOOGL) - Get Report Google reportedly canceled plans for a major new cloud service in China and other markets deemed "sensitive" over geopolitical tensions and Covid-19 concerns.

The tech giant shut down the project, which was dubbed "Isolated Region," in May. The cloud initiative was aimed at allowing countries to control data within their borders, involved hundreds of workers across the world, and was reflective of a "massive strategy shift" for Google, according to an employee quoted by Bloomberg.

The plan was to sell cloud services in what Google calls “sovereignty sensitive markets,” such as China and the European Union, where there are robust laws for companies that collect or process people’s data. The project would have allowed Google to set up cloud computing services controlled by a third party, such as a company or government agency, with data sequestered from Google's other cloud services.

According to documents cited by Bloomberg, geopolitical tensions, in particular between U.S. and China, led to a delay in the project and factored into the company's eventual decision to scrap it entirely. Google reportedly is weighing a scaled-back cloud offering for China.

4. -- Bed Bath & Beyond to Close 200 Stores

Bed Bath & Beyond  (BBBY) - Get Report fell 9.22% to $9.45 in premarket trading Thursday after the housewares retailer said it plans to close 200 stores over the next two years and first-quarter sales plunged 49% due to the Covid-19 pandemic.

The company said it will close “approximately 200 mostly Bed Bath & Beyond stores over the next two years and focus on other SG&A expense reductions.” It expects the moves to generate “future annualized savings of between $250 and $350 million, excluding related one-time costs.”

The retailer posted a wider-than-expected adjusted loss in its fiscal first quarter of $1.96 a share on revenue of $1.31 billion. Analysts had predicted Bed Bath & Beyond to post a loss of $1.27 a share on revenue of $1.39 billion.

"The impact of the Covid-19 situation was felt across our business during our fiscal first quarter, including loss of sales due to temporary store closures and margin pressure from the substantial channel shift to digital,” CEO Mark Tritton said in a statement.

Bed Bath & Beyond said it wouldn't be providing financial guidance for 2020 “due to the continued uncertainty" of the pandemic.

5. -- Eldorado's $17.3 Billion Takeover of Caesars Gets Nevada Approval

Eldorado Resorts'  (ERI) - Get Report proposed $17.3 billion takeover of larger casino rival Caesars Entertainment  (CZR) - Get Report received approval from the Nevada Gaming Commission.

The merger would make Eldorado the largest operator of casinos in the U.S. Its portfolio would include 55 casino resorts, including Caesars Palace in Las Vegas.

The transaction received the green light from the Federal Trade Commission in June. New Jersey and Indiana still need to complete their reviews of the deal.