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Congress has finally inked that $900 billion relief package for Americans who have been deeply affected by the coronavirus pandemic. It comes in the nick of time, too — less than a week prior to the expiration of Pandemic Unemployment Assistance (PUA), which had been keeping long-term unemployed due to Covid-19 contagion shuttering businesses from even more dire economic circumstances. It’s not the grand package the House of Representatives had passed months earlier, but it’s certainly much better than nothing.
In it, $600 checks will be mailed out to individuals earning less than $75K per year, while $300 per week will be allotted for unemployment subsidies. Further, $25 billion is earmarked for rent assistance and eviction protection, so that those affected by the pandemic are not rendered homeless, as well. There are also provisions for child care and schooling grants, as well as funding for state Covid testing, tracing and vaccine distribution.
Also carved out of this $900 billion appropriated is financial relief for small businesses and hard-hit industries. Chief among these looks to be the airlines, which will be receiving $15 billion in payroll aid through March 2021. There is also $1 billion allotted for airline contractor payrolls, and $2 billion for airports and airport-based businesses. News reports cite 32K currently furloughed airline workers now heading back to work. United Airlines (UAL - Free Report) has already said it will be rehiring 13K airline workers.
However, airline analysts understand this is still a stop-gap measure to get the companies through the seasonally tougher Q1 period; with Covid-19 cases near all-time record highs, this business will no doubt be further impacted. Estimates are for passengers levels in the first three months of 2021 to be down between 50-60%. The question becomes: what then? Will vaccinations yield such success that airline travel demand shoots back up for Q2 and beyond, or might airline lobbyists need to return to Capitol Hill for another relief package?
The second revision to Q3 Gross Domestic Product (GDP) was released this morning, up 30 basis points from the first revision to 33.4%. This reflects the economic bounce-back largely provided by the last congressional stimulus package, along with the coronavirus spread ebbing more people engaged in outdoor activities. That said, Q4 GDP is currently expected to be up double-digits — not in the 30% range, but high enough to give investors an encouraging outlook on economic growth going into the new year.
Due to the Christmas Eve and Christmas holidays at the end of the week, economic data will be crammed into Wednesday morning’s pre-market: Jobless Claims, Durable Goods Orders, Personal Income/Consumer Spending and Core Inflation. This will give market participants plenty to chew on going into the holiday weekend. Next week’s trading volume tends to slow down seasonally, though with fewer people making travel plans, perhaps markets will be busier than normal.
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Q3 GDP Points to 33.4%
Congress has finally inked that $900 billion relief package for Americans who have been deeply affected by the coronavirus pandemic. It comes in the nick of time, too — less than a week prior to the expiration of Pandemic Unemployment Assistance (PUA), which had been keeping long-term unemployed due to Covid-19 contagion shuttering businesses from even more dire economic circumstances. It’s not the grand package the House of Representatives had passed months earlier, but it’s certainly much better than nothing.
In it, $600 checks will be mailed out to individuals earning less than $75K per year, while $300 per week will be allotted for unemployment subsidies. Further, $25 billion is earmarked for rent assistance and eviction protection, so that those affected by the pandemic are not rendered homeless, as well. There are also provisions for child care and schooling grants, as well as funding for state Covid testing, tracing and vaccine distribution.
Also carved out of this $900 billion appropriated is financial relief for small businesses and hard-hit industries. Chief among these looks to be the airlines, which will be receiving $15 billion in payroll aid through March 2021. There is also $1 billion allotted for airline contractor payrolls, and $2 billion for airports and airport-based businesses. News reports cite 32K currently furloughed airline workers now heading back to work. United Airlines (UAL - Free Report) has already said it will be rehiring 13K airline workers.
However, airline analysts understand this is still a stop-gap measure to get the companies through the seasonally tougher Q1 period; with Covid-19 cases near all-time record highs, this business will no doubt be further impacted. Estimates are for passengers levels in the first three months of 2021 to be down between 50-60%. The question becomes: what then? Will vaccinations yield such success that airline travel demand shoots back up for Q2 and beyond, or might airline lobbyists need to return to Capitol Hill for another relief package?
The second revision to Q3 Gross Domestic Product (GDP) was released this morning, up 30 basis points from the first revision to 33.4%. This reflects the economic bounce-back largely provided by the last congressional stimulus package, along with the coronavirus spread ebbing more people engaged in outdoor activities. That said, Q4 GDP is currently expected to be up double-digits — not in the 30% range, but high enough to give investors an encouraging outlook on economic growth going into the new year.
Due to the Christmas Eve and Christmas holidays at the end of the week, economic data will be crammed into Wednesday morning’s pre-market: Jobless Claims, Durable Goods Orders, Personal Income/Consumer Spending and Core Inflation. This will give market participants plenty to chew on going into the holiday weekend. Next week’s trading volume tends to slow down seasonally, though with fewer people making travel plans, perhaps markets will be busier than normal.