Stocks Go Down, Too

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The stock market had its worst day in months yesterday, with the S&P 500 index dropping nearly 6 percent. Or, as The Times’s Matt Phillips put it, “At least for a day, reality triumphed over hope on Wall Street.”

Back in the red for the year: At the beginning of this week, a heady stock rally erased all of the market’s losses for the year, even as pandemic lockdowns curtailed activity and companies reported ugly quarterly earnings. Yesterday’s plunge pushed the S&P 500 back below where it began the year (and more than 10 percent off its all-time high, set in February).

• That said, futures suggest a pretty big bounce at the open, regaining about a third of yesterday’s fall.

Blip or bear market? Broadly speaking, there are two schools of thought:

📈 The steep decline during the early stages of the pandemic was a short-term, virus-induced stumble during a rally that began more than 10 years ago.

📉 The sharp rise in recent months was a momentary rally masking a bear market that could roar back if there’s a second wave of infections or long-term economic damage from the lockdowns.

Looking at history as a guide is tricky, because it’s been more than a century since investors had to reckon with a pandemic. If you plot the market from its peak versus other bear markets in recent history, the bullish case is that stocks could behave as they did in 1990 after Iraq’s invasion of Kuwait. That would mean another three or four months before stocks set a new high; other market downturns took a lot longer to regain lost ground.

• Bloomberg’s John Authers notes the 1990 analogy, pointing out that the market reached a new peak after Iraqi forces were expelled from Kuwait. But, he asks: “Is there any way to achieve a comparably clear victory over the coronavirus?”

Hertz is bankrupt — and selling stock

Hertz filed for bankruptcy protection last month. But as investors improbably piled into its shares this week, the car rental pioneer is trying to take advantage of this unexpected turn of events.

The company wants to sell up to $1 billion in new stock. “The recent market prices of and the trading volumes in Hertz’s common stock potentially present a unique opportunity,” lawyers for the company said in a bankruptcy court hearing yesterday.

• Even after falling to $2.06 yesterday, the company’s shares are still way above the 56 cents they traded at after the Chapter 11 filing.

• Some company insiders took advantage of the rally by unloading their shares this week.

The move is exceedingly rare for a bankrupt company, since most Chapter 11 restructurings result in stockholders — who are last in line to recover financial assets — being wiped out.

It’s possible that stockholders could get some money after Hertz restructures. After all, the hedge fund mogul Bill Ackman made a fortune from owning stock in the bankrupt real-estate business General Growth Properties nearly a decade ago. But in a sign of Hertz’s dire financial straits, the company has asked for permission to end leases for more than 144,000 vehicles that it says it can no longer afford.

Companies’ pledges on racial justice

Amid the protests set off by the police killing of George Floyd, corporate America is making more promises to combat racism and discrimination.

Some of the latest moves:

• Apple and YouTube each pledged $100 million for race initiatives. Apple will donate money toward education and criminal justice reform, though it gave few details about what that will entail. YouTube will create a fund to highlight black creators on its platform, and in some cases directly fund black-focused content.

• A founder of The Wing, Audrey Gelman, resigned as C.E.O. of the women-focused co-working company. She faced criticism for what current and former workers said was mistreatment of minority workers.

• Hasbro removed cards from “Magic: The Gathering,” a popular fantasy card game, that featured offensive characters.

But the gap remains wide. The Financial Times notes that management teams and corporate boards still have few black and other minority members, despite years of companies’ pledging to improve diversity.

• Kemi Role, a top official at the National Employment Law Project, told The Wall Street Journal that improvements need to be made throughout companies: “How are their cafeteria workers being treated? How are their people in factories being treated?”

• Ultimately, companies will be judged on their results, Stephanie Creary of the Wharton business school notes in a list of tips for making meaningful corporate statements: “If you do nothing after saying something, your words will not matter.”

Here’s what else is happening

The European Union is preparing an antitrust case against Amazon. Regulators plan to argue that the e-commerce giant has unfairly used third-party merchant data to promote its own products, The Times’s Adam Satariano reports.

Goldman Sachs wants to settle the 1MDB scandal without admitting guilt, The Times’s Matt Goldstein reports. The Wall Street firm is pushing back against federal prosecutors who want the bank to pay over $2 billion in fines and plead guilty to a felony.

Who are Joe Biden’s economic advisers? It’s unclear who has the ear of the Democratic presidential candidate, and a recently formed economic policy committee urged participants to stay silent on what is discussed. That said, here’s Mr. Biden’s plan for reopening the economy, released yesterday.

It’s good to talk

Yesterday we highlighted a study about positive effects of small talk in the office, which the researchers called “uplifting yet distracting.” With so many offices and other workplaces now closed, there are fewer opportunities for superficial chitchat, which could be a good thing for efficiency. But judging by readers’ response, you (mostly) miss it:

• Everhard: “Small talk is an essential part of the informal organization, and without any informal organization a company will never work efficiently.”

• Karen: “Personally, I probably abused the time talking to fellow employees about non-work subjects and gossiping, but it was wonderful to be able to converse about things going on in the world outside. I give it a 70 percent good use of time.”

• Larry: “Asking somebody how their weekend was, or how the kid’s baseball game or school play went, is all part of how an organization grows.”

• Jasmin: “I have enjoyed my solitude during this season of confinement. I have maintained contact with some of my favorite colleagues and continue to run away from the chatterbox always trying to initiate a conversation.”

• Alan: “Companies can’t force those kinds of interactions with Zoom happy hours.”

The speed read

Deals

• The food delivery service DoorDash is reportedly near a deal to raise money from investors including T. Rowe Price and Fidelity at a $15 billion valuation. (WSJ)

• Palantir, the data consultancy, reportedly plans to file for a public market listing within weeks, with an eye to begin trading in the fall. (Bloomberg)

• The private equity giant KKR is said to have asked outside advisers to cut their fees at least 15 percent to “share in the economic pain” of the pandemic. (FT)

Politics and policy

• The Trump administration abandoned an earlier commitment to disclosing which companies received federal coronavirus rescue loans. (WaPo)

• Treasury Secretary Steven Mnuchin said Harriet Tubman would not replace Andrew Jackson as the face of the $20 bill until at least 2030. (NYT)

Tech

• Chris Cox, who quit as Facebook’s chief product officer last year amid a disagreement with Mark Zuckerberg, will return to that position. Separately, the company plans to create a new fund to invest in start-ups. (NYT, Axios)

• Zoom apologized for following a Chinese government request to take down the account of a U.S.-based humanitarian group that commemorated the 1989 Tiananmen Square protests. (CNBC)

• An ad tech company secretly used facial-recognition software on 30,000 people who attended this year’s Rose Bowl. (OneZero)

Best of the rest

• The economics of harvesting frozen water on the Moon. (Quartz)

• Nintendo’s “Animal Crossing: New Horizons” looks increasingly like a pixelated Wall Street. (WaPo)

We’d love your feedback. Please email thoughts and suggestions to dealbook@nytimes.com.