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St. Louis Fed's James Bullard on lending program, reopening the economy and more

St. Louis Fed President James Bullard joins “Squawk Box” to discuss the central bank’s unprecedented lending program, how the economy might rebound after the coronavirus crisis, the April ADP jobs report and more.

A growing number of states are beginning to reopen their economies in the first two weeks of May, a trend that’s making investors optimistic that the worst of the economic downturn may have already passed.

The above chart shows how many Americans will soon see Covid-19 restrictions lift. To be sure, all eyes will be on whether those states see a “second wave” resurgence of coronavirus cases as residents begin to congregate, which would reverse that trend.

Covid-19 curves “will become important again as economies open up. Especially in 10ish days from now. We start with Korea … followed by Florida, Georgia and Sweden,” wrote Evercore ISI portfolio strategist Dennis DeBusschere, who has been closely tracking coronavirus updates for clients.

The chart could look even better if New York and California make announce official reopenings.

California Gov. Gavin Newsom on Monday detailed plans for his state. The governor said that clothing, book and music stores — as well as florists in time for Mother’s Day — could open as soon as Friday. Manufacturers that support the retail industry would also be allowed to begin production, Newsom added.

“We are entering into the next phase this week … with modifications, we will allow retail to start operating across the spectrum,” Newsom said Monday. “This is a very positive sign, and it has happened only for one reason: The data says it can happen.”

New York, the coronavirus’s epicenter in the United States, is on track to begin a gradual reopening on May 15. The state will, data depending, allow manufacturing, construction and certain retailers to open next week. If that phase one does not lead to a concerning uptick in new cases, New York will then allow professional services, more retailers and real estate firms to open their doors.

New York and California are labeled as “no date announced” in the above graphic because neither state has issued a definitive date of reopen. California is “as early as Friday” and New York Gov. Andrew Cuomo’s business halt order expires on May 15, but he has not definitively said the Empire State would open then.

The reopening on the horizon has boosted asset prices that were under siege in March.

The S&P 500 is up more than 30% from its March low. Oil prices were up 20% on Tuesday alone and have nearly doubled in the last five days.

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