When the Facts Change, I Change My Mind. What Do You Do, Sir?
John Maynard Keynes

1. Insurance Firms Gain Early Lead in Coronavirus Legal Fight With Businesses — U.S. property insurers have won a flurry of judicial rulings backing up their rejections of claims for businesses’ lost income during government-ordered shutdowns, dimming policyholders’ hopes of payments to help them rebound. Across the U.S., restaurants, hair salons, retailers and other businesses are seeking policy proceeds to deal with the huge economic cost of the shutdowns, in one of the biggest fights the insurance industry has ever waged with its policyholders. So far insurers have prevailed in state courts in California, Michigan and the District of Columbia, and in federal courts in Texas and California, according to a Covid-19 litigation-tracking effort at the University of Pennsylvania Carey Law School.
2. New York City Delays Reopening of Schools — the largest school district in the U.S. delayed the start of in-person teaching after Mayor Bill de Blasio and the teachers union reached an agreement and averted the threat of a strike over classroom safety concerns amid the coronavirus pandemic. The school district, with about 1.1 million students, has a hybrid model, in which some students will take online classes daily while others take remote classes for part of the week and attend school in person the other days. The district is the only major U.S. school system moving forward with a return to in-person learning in September.
3. U.S. Debt Is Set to Surpass the Size of the Economy — U.S. government debt will exceed the size of the economy, at $3.311 trillion, for the first time since World War II. Federal debt is projected to reach or exceed 100% of U.S. gross domestic product, according to the nonpartisan Congressional Budget Office, for the fiscal year, which ends Sept. 30. The last time U.S. debt was higher than economic output was in 1946, when it was 106% after financing military operations to help end World War II, The Wall Street Journal reported.
4. U.S. Stocks Routed Amid Decline in Tech Shares — the tech-heavy Nasdaq Composite dropped nearly 5% to 11458, its biggest one-day percentage decline since June 11, in a reversal of a rally that had taken it and the S&P 500 to new highs. The S&P 500 lost 3.5% to 3455, with all 11 sectors showing losses. The uptick in market volatility could be due to a large number of call options, which confer the right to buy shares, on technology stocks such as Apple and Tesla, according to Saxo Bank. Market makers have been forced to take the other side of such trades, buying the underlying stocks to hedge their positions.

The week ahead — Economic data from Econoday.com: