The outbreak of the coronavirus has dealt a shock to the global economy with unprecedented speed. Following are developments Tuesday related to the global economy, the work place and the spread of the virus.
GLOBAL MALAISE: Economists are trying to put into context the shock that the world must absorb. On Tuesday, the International Monetary Fund put the damage at Great Depression levels.
— France is forecasting an 8% drop in growth this year and is staring down its worst recession since World War II. And that 8% drop may be optimistic, Finance Minister Bruno Le Maire said Tuesday.
— Italian book, stationary and children's stores were allowed to open nationwide Tuesday, provided they could maintain the same social-distancing and safety measures required of supermarkets.
— Poland will gradually lift restrictions Sunday on businesses and individuals. The number of people allowed into shops will be increased and some restrictions on pubic movement will be lifted.
— Audi restarted operations at its Hungarian plant, though at a very limited scale.
— Austria is allowing small retailers, DIY businesses and gardening supply stores to reopen Tuesday. Customers will be required to wear masks and maintain social distancing.
BREATH OF FRESH AIR: There is a dire need for medical devices due to the severity of the outbreak.
— Hamilton Medical will open its first U.S. factory to make ventilators. The Swiss company is hiring several hundred people to staff the Reno, Nevada, plant, with help from General Motors. Production begins this month. The U.S. awarded Hamilton a $552 million contract to build 14,115 ventilators by July 3.
— General Motors says it has started producing breathing machines at a repurposed electronics plant in Kokomo, Indiana. The company plans to ship more than 600 of the critical care ventilators by the end of April under a contract with the U.S. Department of Health and Human Services. The $489.4 million contract calls for GM to deliver 30,000 by the end of August. GM said it is producing the ventilators at cost.
COST IN JOBS: The wave of layoffs and furloughs have been massive and companies continue to shed jobs.
— Groupon will release or furlough about 2,800 workers, more than 40% of its workforce.
RETAIL THERAPY: Retailers and malls have been hard hit by the shutdown, but some are pivoting.
— American Dream, a huge New Jersey entertainment complex, is partnering with health care companies to open a drive-thru testing site for the COVID-19 virus at its massive parking lot. The complex, the second largest mall behind Mall of America, was supposed to unveil a water park and hundreds of stores last month but ended up closing entirely to curb the spread of the coronavirus.
FOOD FIGHTERS: Grocery store workers have been on the front lines during the crisis, trying to keep food and essential goods flowing. They're also some of the most exposed.
— Kroger and the United Food and Commercial Workers union are asking federal and state government officials to temporarily designate grocery store workers as “first responders” or “emergency personnel.” Kroger said the designation would ensure grocery workers get priority access to gloves and masks. Kroger is the largest U.S. grocery chain, with nearly 500,000 employees. The represents 1.3 million food industry workers, including 900,000 grocery employees. The union estimates at least 30 of its members have died from COVID-19.
THIN AIR: It's a mixed day for airlines. From an operations standpoint, the situation continues to deteriorate. But an agreement on a rescue package appears to be nearing.
— The International Air Transport Association estimated Tuesday that passenger revenue this year will tumble $314 billion, a 55% plunge, from 2019. Two weeks ago, the IATA forecast a $252 billion drop.
— Airline stocks rose sharply ahead of an Treasury Department announcement that major U.S. airlines had tentatively agreed on $25 billion in federal aid to pay workers and employ them through September.
— In the latest cutback by a major publisher, the company that owns the Los Angeles Times is cutting pay from 5% to 15% for 12 weeks for senior managers and furloughing some business-side employees for up to 16 weeks because of “unprecedented” revenue declines, according to an internal memo sent Tuesday. That follows news of pay cuts, furloughs or buyouts from news publishers McClatchy and Tribune Publishing last week.
EARNINGS SEASON!: Twenty-three S&P 500 constituents are scheduled to report quarterly earnings this week. Everyone will be looking closely at companies with operations in China to see how those operations emerged from the outbreak.
MARKETS: Volatility in markets continues.
— Stocks closed higher as the White House and a number of state governors weighed how to reopen the economy.
ISLANDS IN THE STREAM: Global activity has screeched to a halt, but there are aspects that are humming, and that includes streamed entertainment.
— Roku expects first-quarter steaming hours will spike 49% compared with last year, about 13.2 billion hours. It anticipates an increase of 3 million active users, close to 40 million.
The newly launched Disney streaming service now has 50 million new subscribers.