Stocks begin a shaky recovery after the Delta variant spread prompted a rout.

Many of the biggest efforts, including eviction moratoriums and expanded unemployment benefits, are about to expire.,

July 20, 2021Updated July 20, 2021, 7:10 a.m. ETJuly 20, 2021, 7:10 a.m. ET

An employee posted warnings to customers at the entrance to a store at a mall in Los Angeles on Monday.
An employee posted warnings to customers at the entrance to a store at a mall in Los Angeles on Monday.Credit…Etienne Laurent/EPA, via Shutterstock

U.S. stock futures and European equity indexes rose on Tuesday, beginning a tentative recovery from the stock market’s worst day in months. Surging numbers of coronavirus cases, spurred by the Delta variant, had unnerved investors on Monday and introduced a bout of volatility into financial markets.

The quickening spread of the virus and the uncertain path of monetary policy have been a reminder that the recovery from the pandemic is likely to remain rocky.

And the gains on Tuesday were relatively small. The S&P 500 is set to open 0.5 percent higher, futures indicated, a day after the benchmark U.S. index dropped 1.6 percent and the VIX index, a gauge of market volatility, hit its highest level since mid-May.

In the bond market, yields continued to decline. The yield on 10-year U.S. Treasury notes fell one basis point, or 0.01 percentage point, to 1.18 percent, undoing a rise earlier in the morning. On Monday, the yield had tumbled 10 basis points to 1.19 percent, the lowest level since February.

The Stoxx Europe 600, which tumbled 2.3 percent on Monday — the worst day this year — rose 0.4 percent. Asian markets closed lower on Tuesday, following the drop on Wall Street the previous day.

“Although bargain hunters will be sniffing around, nervousness is still largely the sentiment rippling through the markets, as concerns are growing that higher infection rates will bring about a fresh economic slowdown,” Susannah Streeter, an analyst at Hargreaves Lansdown, wrote in a note.

She added that tensions between U.S. and China could raise concerns about global trade. On Monday, the Biden administration accused the Chinese government of hacking Microsoft.

One company at the sharp end of this bumpy recovery is easyJet, the bargain European airline. “The road to recovery from the pandemic isn’t going to be a straight line,” the company’s chief executive, Johan Lundgren, said on Tuesday, although he insisted that the airline was prepared for it.

EasyJet’s shares rose 2 percent after the airline said that it expected to fly at 60 percent of its 2019 level in the three months through the end of September, compared with 17 percent in second quarter of this year. Over the summer, it plans to increase routes among continental European cities. The airline’s shares had fallen 6.6 percent on Monday.

Senator Ron Wyden of Oregon, the Finance Committee chairman, said Democrats were proposing changes to the “pass-through” tax deduction because “many Main Street small-business owners are excluded.”Credit…Sarahbeth Maney/The New York Times

Senate Finance Committee Democrats will move on Tuesday to sharply limit the number of businesses eligible for a generous tax break in the 2017 tax cuts that congressional Republicans passed and that President Donald J. Trump signed into law.

They will unveil a measure that takes aim at “pass through” businesses like law firms, real estate trusts, family farms and other companies that are taxed at the owner’s individual income tax rate. The 2017 law granted those businesses a 20 percent deduction.

Democrats want that deduction limited to traditional small businesses and plan to include their effort in the $3.5 trillion economic bill that President Biden has proposed.

Though it was billed as a small-business break, Democrats on the Finance Committee say 61 percent of the 2017 benefit has gone to the top 1 percent of earners. Under the 2017 measure, a rich business partner at the highest income tax rate, 37 percent, saw a cut of 7.4 percentage points.

“Half the benefit of the pass-through deduction goes to millionaires, and because the benefit is so skewed toward the top, many Main Street small-business owners are excluded,” Senator Ron Wyden of Oregon, the Finance Committee chairman, said in a statement.

Under the revised tax break, complicated categories and calculations to determine which partnerships, limited liability companies and other pass-through businesses qualify would be ditched, opening the deduction potentially to more businesses. But the deduction would be phased out for individuals earning more than $400,000, the income under which Mr. Biden has vowed not to raise taxes.

The committee did not immediately say how much the income cap would save the Treasury, but it could be substantial — without greatly reducing the number of businesses claiming the deduction. By the panel’s estimate, small-business owners with incomes under $200,000 have made up 80 percent of taxpayers who claimed the deduction, but 52.4 percent of the revenue lost to the Treasury went to millionaires and billionaires.

Congress’s Joint Committee on Taxation estimated that tax savings under the existing break for taxpayers earning more than $500,000 would total around $36.9 billion in 2024 alone.

The measure is the first of what will be a slew of measures that would pay for social and environmental spending by raising taxes on the rich and on wealthy corporations. Because those measures will go through a budget process called reconciliation, they can pass the Senate without any Republican support — if all Democrats and their two independent allies stay united.

“It’s going to make the policy more fair and less complex for middle-class business owners, while also raising billions for priorities like child care, education and health care,” Mr. Wyden said.

Credit…Robert Neubecker

The pandemic has been receding as life returns to normal for many Americans. But the government relief programs that helped support Americans over the last year are now fading away.

The federal legislative packages were worth trillions of dollars, creating a temporary safety net that provided help for people dealing with lockdowns, job losses and worse. Many of the most far-reaching protections, including eviction moratoriums and expanded unemployment benefits, are about to expire. Provisions affecting student loans, food stamps and more are scheduled to follow in the coming months.

It’s not all bad: This month, millions of households are receiving the first of six monthly payments that are part of an expanded child tax credit. But if you rely on any of the programs that are going away, this is an anxious time.

Fortunately, there’s still help out there — and The New York Times’s Tara Siegel Bernard and Ron Lieber report on how you can find it.

Their report focuses on seven key areas: eviction protections; unemployment insurance; student loans; health insurance; mortgage forbearance; food assistance; and family and medical leave.

Top U.S. financial regulators met on Monday to discuss stablecoins, asset-backed digital currencies that are exploding in popularity so quickly that the government is struggling to keep up — and that economic officials increasingly see as a risk to financial stability.

Stablecoins are cryptocurrencies that derive their value from an underlying currency or basket of assets, and they have long been a point of unique concern. When news broke in 2018 and 2019 that Facebook was looking into creating a stablecoin, the Federal Reserve and other regulators took note, worried that the project could gain scale rapidly. Pressure to develop a framework for overseeing them has ramped up even more recently, as prominent stablecoins including Tether and Binance have exploded in popularity.

The Treasury Department announced on Friday that Secretary Janet L. Yellen would convene a meeting of the President’s Working Group on Financial Markets to discuss regulators’ work on stablecoins. That group includes Jerome H. Powell, the chair of the Federal Reserve, and the leaders of the Securities and Exchange Commission and the Commodity Futures Trading Commission. Monday’s meeting was expanded to include the heads of the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation.

Meeting participants “discussed the rapid growth of stablecoins, potential uses of stablecoins as a means of payment, and potential risks to end-users, the financial system, and national security,” according to a Treasury statement released after the meeting on Monday. Ms. Yellen “underscored the need to act quickly to ensure there is an appropriate U.S. regulatory framework in place.”

Mr. Powell has been particularly outspoken about the need for better oversight of stablecoins and said repeatedly during two congressional appearances last week that they are inadequately regulated.

“If we’re going to have something that looks just like a money-market fund, or a bank deposit, a narrow bank, and it’s growing really fast, we really ought to have appropriate regulation — and today we don’t,” he said during testimony before the Senate Banking Committee.

Eric Rosengren, the president of the Federal Reserve Bank of Boston, has similarly warned about Tether, arguing that it relies on underlying financial assets that could experience investor runs in times of trouble. New York’s attorney general said earlier this year that Tether had misled investors by claiming to be fully backed by U.S. dollars at all times.

The Treasury said that the working group expects to issue recommendations in the coming months for stablecoins. The group has previously warned stablecoin operators that they need to maintain adequate cash reserves to back their offerings.

The Fed could also try to elbow aside digital offerings by offering its own alternative.

The central bank is looking into a digital currency offering, which would probably function much like the digital cash you spend when you swipe your debit card. But where that debit card money ties back to the commercial banking system, the central bank digital currency would have direct backing from the Fed, just like physical cash does.

Mr. Powell told lawmakers last week that obviating the need for stable coins could be one of the stronger arguments for a digital dollar.

But Mr. Powell remains undecided on whether a central bank digital currency makes sense, he told lawmakers. The Fed is planning to publish a comprehensive report on the possibility of a digital dollar, probably around September.

TOKYO — While the Olympics may be celebrated as a showcase of athletic feats and global harmony, they have also become a multibillion-dollar marketing opportunity for the world’s most famous brands.

No company was better positioned to scoop up the immense profits from this bonanza than Dentsu, an advertising goliath hard-wired into nearly every major institution in Japan.

As a gatekeeper to the world’s third-largest economy, the company has become a major figure in international sports. It played a prominent role in Tokyo’s Olympic bid, then was named the Games’ exclusive advertising partner, bringing in a record-shattering $3.6 billion from Japanese sponsors.

But the pandemic has played havoc with the company’s plans, and presented a serious test of its skill at message control.

The advertising campaigns and promotional events that sponsors usually mount in the months before the Olympics have been canceled or pared down. And now, with the Games about to begin, Toyota said that it would not run Olympics-themed television ads in Japan during the event, reflecting its unpopularity in the host nation.

Still, even with its challenges, Dentsu remains an unparalleled force in Japan, an invisible hand behind an Olympics that would not have come to Tokyo without its efforts.

Dentsu was one of the first ad agencies to recognize how international sporting events could raise clients’ profiles abroad and help them break into new markets. Its ties to the Olympics stretch back to 1964, when it handled public relations for the first Tokyo Games. It led the bid for the 1998 Nagano Winter Games, and was the natural choice to spearhead the effort to bring the Olympics back to Tokyo.

“If you’re going to do sports marketing business in Japan, they’re kind of your first and last stop, to be honest. They hold a lot of the cards,” said Terrence Burns, a sports consultant and former International Olympic Committee executive.

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