Morning Brief

What to watch today: Dow set to rise as investors bet on economy reopening despite protests

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BY THE NUMBERS

Dow futures were pointing to a gain at Tuesday's open. After a strong month of May, the Dow started June on the upside as Wall Street continued to bet on a successful reopening of the U.S. economy after the coronavirus halt. The Dow Jones Industrial Average on Monday rose 0.4%. The move higher came despite violent protests, sparked by the killing of George Floyd during an arrest in Minneapolis. (CNBC)

Cramer on Wall Street's relation to protests: 'The market has no conscience' (CNBC)

Investors are monitoring whether the protests will set back state coronavirus reopening plans or lead to a spike in Covid-19 cases. Dr. Scott Gottlieb, the former FDA chief, told CNBC on Tuesday it will be difficult to parse the contribution of protests to any new cases from the general reopenings that have started to also bring people together again. (CNBC)

Some automakers report monthly U.S. sales today, although Ford (F) and General Motors (GM) only report on a quarterly basis. Auto website Edmunds estimates that U.S. sales fell 32.5% last month compared to May 2019, but registered a 50.5% jump from April. This afternoon, Zoom (ZM) issues quarterly numbers after the closing bell. (CNBC)

The coronavirus crisis is likely to reduce U.S. economic growth by $7.9 trillion, or 3%, through fiscal 2030, according to the Congressional Budget Office. Senate Minority Leader Chuck Schumer, D-N.Y., used the bleak CBO estimate as an argument for more pandemic funding. (CNBC)

IN THE NEWS TODAY

President Donald Trump has threatened to deploy the military if states and cities fail to control the unrest. As Trump spoke Monday evening, ahead of another night of tumult across America, riot police and military police used tear gas to clear demonstrators out of Lafayette Square, a public square in front the White House. (CNBC)

After the demonstrators were cleared out, Trump left the White House and walked through the square to raise a Bible in front of St. John's Church, which had been set on fire by protesters Sunday night. During a teleconference earlier Monday, Trump berated governors for not using harsher tactics to bring demonstrations under control. (CNBC)

Ford Executive Chairman Bill Ford and CEO Jim Hackett sent a letter to employees regarding the "tragic killing of George Floyd" as well as the coronavirus pandemic and America's "systemic racism." The letter said Ford leaders will hold dialogues with their teams "to understand how people are feeling and discuss how we can get better together." (CNBC)

Chipotle (CMG) CEO Brian Niccol spoke out about the Floyd killing and the protests. Niccol told CNBC's "Mad Money" on Monday evening that a number of franchises were damaged. "Fortunately, all of our employees have been safe," he said. "We have had some damage to restaurants, but it's all damage frankly that we can patch up and fix." (CNBC)

Amazon (AMZN) shoppers are stocking up on pepper spray and Black Lives Matter merchandise as protests continue to erupt nationwide, according to sales rankings on its web site. The rankings show that the protests against police brutality are at the forefront of some consumers' minds. (CNBC)

Facebook (FB) CEO Mark Zuckerberg plans to hold a company town hall meeting Tuesday, a day after hundreds of employees staged a "virtual walkout." They were protesting the decision by Facebook's leaders to leave up a Thursday post from Trump, in which he said that "when the looting starts, the shooting starts," about the Floyd demonstrations. (CNBC)

Uber, Lyft and DoorDash are suspending operations during the curfew hours that some U.S. cities imposed to try to defuse the violent protests. The unrest has added to the mounting list of challenges for many companies trying to recover and reopen as many states begin lifting coronavirus restrictions. (CNBC)

Bank of America (BAC) announced Tuesday that it will commit $1 billion over four years to help local communities deal with the widened economic and racial inequality caused by the Covid-19 outbreak. In a press release, the bank said the program will focus on "assisting people and communities of color that have experienced a greater impact from the health crisis." (CNBC)

Starbucks' (SBUX) plans to further cut back on employee hours reflect expectations that pandemic-hit sales probably won't recover until the fall, according to The Wall Street Journal. The coffee giant reopened U.S. locations in May with reduced operations, only allowing drive-thru, delivery and pickup.

Southwest Airlines (LUV) is offering workers buyout packages and temporary paid leaves, in what CEO Gary Kelly described as an effort to ensure the carrier's survival as the coronavirus killed air travel demand. Southwest has never laid off or furloughed employees in its 49-year history. (Reuters)

STOCKS TO WATCH

Dick's Sporting Goods (DKS) retailer lost an adjusted 62 cents per share for the first quarter, wider than the 57 cent loss expected by Wall Street. Revenue and comparable store sales also missed estimates, due to Covid-19 related store closures. Dick's did see a 110% surge in e-commerce sales during the quarter, and added that the current quarter has gotten off to a strong start.

Lands' End (LE), in a preliminary report, said it lost 64 cents per share for its first quarter, wider than the 56 cent loss that analysts had anticipated, while revenue was slightly below forecasts. The apparel retailer said company operated stores had seen comparable store sales growth of 14.2% in February before stores closed in mid-March due to the outbreak.

Apple (AAPL) is cutting iPhone prices in China, as it seeks to extend the momentum it has enjoyed as the Chinese economy gradually reopens following virus-related lockdowns and closures. While Apple's own official Chinese website does not reflect price reductions, double-digit discounts can be seen on various reseller sites.

Stitch Fix (SFIX) will cut 1,400 jobs in California and move some operations to a handful of lower-cost locations. The online clothing stylist said the move was related to the cost of doing business in California and not to the Covid-19 pandemic. It also said it would offer new roles to all those affected.

Visa (V) said that U.S. payment volumes fell by 5% in May, slower than the 18% decline registered in April, in a possible indication that consumer spending is recovering as coronavirus-related lockdowns are eased.

MoneyGram (MGI) is the target of a takeover bid by rival money transfer company Western Union (WU), according to a Bloomberg report. No potential purchase price was disclosed. MoneyGram, a small stock, was soaring over 50% in the premarket.

WATERCOOLER

The music industry is staging Blackout Tuesday in support of protests around Floyd's killing, with companies including Spotify and Apple participating in different ways. Artists expressing support include Lady Gaga, the Rolling Stones and Billie Eilish. (Engadget)