This article is from the source 'nytimes' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at https://www.nytimes.com/2020/03/30/business/coronavirus-stock-markets-economy.html

The article has changed 33 times. There is an RSS feed of changes available.

Version 10 Version 11
Macy’s to Furlough Most of Its 130,000 Workers: Live Business Updates Macy’s to Furlough Most of Its 130,000 Workers: Live Business Updates
(32 minutes later)
Macy’s, which also owns Bloomingdale’s and Bluemercury, said on Monday that it has lost “the majority” of its sales because of store closures, which started March 18 and will persist until the retailer has a “clear line of sight on when it is safe to reopen.” Macy’s, which also owns Bloomingdale’s and Bluemercury, said on Monday that it had lost “the majority” of its sales because of store closures, which started March 18 and would persist until the retailer had a “clear line of sight on when it is safe to reopen.”
The company said that as a result, it will furlough the majority of its employees this week and maintain the “absolute minimum work force needed to maintain basic operations,” according to a statement. The company said that as a result, it will furlough the majority of its employees this week and maintain the “absolute minimum work force needed to maintain basic operations,” according to a statement. There will be fewer furloughs among employees supporting the digital business at call centers and distribution centers. Macy’s had 130,000 part-time and full-time employees as of Feb. 2.
There will be fewer furloughs among employees supporting the digital business with call centers and distribution centers. Macy’s had 130,000 part-time and full-time employees as of Feb. 2. The move shows the strain that the pandemic is placing on retailers selling goods that are considered nonessential. Many department stores and mall chains had already been weakened in recent years by the rise of e-commerce and a drop in foot traffic at malls. A complete closure of stores and a shift in consumer spending is dealing a new blow to such companies and their many employees.
The cuts show the strain that the pandemic is placing on retailers selling goods that are considered “nonessential.” Many department stores and other mall chains had already been weakened in recent years by the rise of e-commerce and changes in foot traffic at malls. A complete closure of stores and a shift in consumer spending is dealing a new blow to such companies and their many employees. Macy’s also said that it had already stopped capital spending and paying a dividend. It has also drawn down its line of credit and canceled some orders.
Macy’s also said on Monday that it had already stopped capital spending and paying a dividend. It has also drawn down its line of credit and canceled some orders.
“While these actions have helped, it is not enough,” the company said. “At least through May, furloughed colleagues who are enrolled in health benefits will continue to receive coverage with the company covering 100% of the premium. We expect to bring colleagues back on a staggered basis as business resumes.”“While these actions have helped, it is not enough,” the company said. “At least through May, furloughed colleagues who are enrolled in health benefits will continue to receive coverage with the company covering 100% of the premium. We expect to bring colleagues back on a staggered basis as business resumes.”
Oil prices hit their lowest levels since 2002 on Monday as Brent crude, the international benchmark, fell nearly 6 percent to $23.50 a barrel and West Texas Intermediate, the U.S. marker, briefly fell below $20. Oil prices hit their lowest levels since 2002 on Monday, as the gloom over energy markets deepened after President Trump extended guidelines on social distancing and nonessential travel in the United States, an admission that there is no certainty around when the spreading coronavirus epidemic will end.
The sharp economic contraction caused by the spreading coronavirus epidemic is causing demand for oil, the world’s largest source of energy, to evaporate. The gloom deepened on Sunday as President Trump extended guidelines on social distancing and nonessential travel in the United States another two weeks until at least the end of April. The drop was the strongest signal from financial markets that investors remained uneasy about the fate of the economy. Stocks in the United States rose, but shares in Europe drifted between gains and losses and major benchmarks in Asia were lower.
In addition, there is little sign that Saudi Arabia and Russia, two of the largest oil producers, are willing to end the price war that erupted after a failed OPEC meeting this month. The United States has been leaning on the Saudis to end the feud, which has resulted in an increase in oil production. But on Friday, Saudi Arabia issued an unusual statement saying that the kingdom was not engaged in talks with Russia “to balance oil markets.” The dizzying moves that characterized trading in financial markets for most of March seem to have ended as policymakers around the world moved to bolster their economies with spending and other means of support. But investors were weighing those efforts — including an unprecedented $2 trillion spending plan in the United States — against the rising number of coronavirus cases.
Mr. Trump on Monday morning said he would have a phone conversation with Russia’s president, Vladimir V. Putin, to discuss the oil situation. Speaking on “Fox & Friends,” Mr. Trump said, “I never thought I’d be saying that maybe we have to have an oil increase, because we do,” he said. He said he would talk to Mr. Putin right after the TV interview. Brent crude, the international benchmark, fell nearly 6 percent to $23.50 a barrel on Monday, and West Texas Intermediate, the U.S. marker, briefly fell below $20.
Analysts say that the collapse in demand caused by the pandemic far outweighs the threat of new supplies from OPEC and Russia. FGE, a consulting firm, recently estimated that demand for April would fall by 17 million barrels a day — about 17 percent lower than usual — as airplanes are grounded, road traffic falls sharply and factories are shuttered. Oil has also been hammered by a price war between Saudi Arabia and Russia, two of the largest oil producers, that erupted after a failed OPEC meeting this month, but analysts say that the collapse in demand caused by the pandemic far outweighs the threat of new supplies from OPEC and Russia.
There are growing concerns that a surplus of oil and refined products may overwhelm available storage facilities. Analysts say the combination of low prices and lack of sufficient storage to hold the glut may lead companies to shut down wells. FGE, a consulting firm, recently estimated that demand for April would fall by 17 million barrels a day — about 17 percent lower than usual — as airplanes are grounded, road traffic falls sharply and factories are shuttered.
Stocks on Wall Street rose on Monday, even as other global markets signaled that investors were still nervous about the economy as governments extended measures to contain the coronavirus outbreak.
Trading was volatile, but the S&P 500 rose as much as 2 percent by late morning.
Stocks in Europe treaded water while shares in Asia had ended broadly lower. The economic concern was most starkly evident in oil prices, which fell to their lowest levels since at least 2002. West Texas Intermediate, the U.S. crude benchmark, briefly fell below $20.
President Trump on Sunday evening extended the social distancing guidelines for the United States until the end of April. He had earlier expressed a desire for the economy to get up and running by Easter on April 12. To offset the economic damage caused by containment measures, lawmakers in the United States enacted the largest relief package in American history.
The week ahead will bring some key economic data that will continue to paint a picture of the toll that the virus is taking on the American economy.The week ahead will bring some key economic data that will continue to paint a picture of the toll that the virus is taking on the American economy.
The jobs report from the Labor Department comes out Friday morning. It’s often a good indicator of the direction of the economy, though this month’s will offer an outdated snapshot because it will be based on surveys conducted before the nation’s business shutdown kicked into full gear. The big headline jobs number is expected on Thursday, when the government will announce the number of people across the country who filed for initial unemployment benefits last week. In the week before, nearly 3.3 million claims were filed, a record by a long shot. On Friday, the monthly jobs report from the Labor Department will be released.
The big headline jobs number is expected on Thursday, when the government will announce the number of people across the country who filed for initial unemployment benefits last week. In the week before, nearly 3.3 million claims were filed, a record by a long shot.
The week will also see the release of information about the American manufacturing sector, which most economists think is contracting again after briefly rebounding earlier this year.
But investors were also weighing the longevity of the pandemic, as the number of coronavirus cases continued to spike.
In Europe, the FTSE 100 in Britain and CAC 40 were down slightly, while stocks in Germany were slightly higher.
Top Democrats are urging the Treasury Department and Federal Reserve to use nearly $500 billion from the $2 trillion economic rescue package that became law last week to bail out revenue-strapped states and cities, instead of granting loans to large corporations.Top Democrats are urging the Treasury Department and Federal Reserve to use nearly $500 billion from the $2 trillion economic rescue package that became law last week to bail out revenue-strapped states and cities, instead of granting loans to large corporations.
The law appropriates $454 billion from Treasury to backstop loans from the Fed to eligible businesses, municipalities or states. Officials have so far focused their emergency lending programs on businesses. Senator Elizabeth Warren of Massachusetts wrote to Treasury on Friday, calling the needs of local and state governments “a matter of life and death.”The law appropriates $454 billion from Treasury to backstop loans from the Fed to eligible businesses, municipalities or states. Officials have so far focused their emergency lending programs on businesses. Senator Elizabeth Warren of Massachusetts wrote to Treasury on Friday, calling the needs of local and state governments “a matter of life and death.”
The Fed has come under increasing pressure to help state and municipal finance, potentially by investing directly in local debt, though it has thus far declined to. Some of its programs help local bond markets, but do so indirectly.The Fed has come under increasing pressure to help state and municipal finance, potentially by investing directly in local debt, though it has thus far declined to. Some of its programs help local bond markets, but do so indirectly.
Investors widely expect the central bank to unveil some sort of program to provide additional support to states and localities. The central bank has recently hired Kent Hiteshew, a former Treasury official who is an expert in municipal debt, a spokesman confirmed.Investors widely expect the central bank to unveil some sort of program to provide additional support to states and localities. The central bank has recently hired Kent Hiteshew, a former Treasury official who is an expert in municipal debt, a spokesman confirmed.
President Trump on Friday accused General Motors and its chief executive, Mary T. Barra, of dragging their feet on a project to build ventilators and directed his administration to force the company to make ventilators under a 1950s law. But accounts from five people with knowledge of the automaker’s plans depict an attempt by G.M. and its partner, Ventec Life Systems, to accelerate production of the devices.
On March 19, G.M. began collaborating with Ventec, which normally makes about 200 machines a month, to figure out how to make about 10 times as many in that time. Working through the weekend of March 21 and 22, they hurried to find new suppliers that could provide parts in high volumes, said the five people, who asked not to be named because they fear it would further antagonize Mr. Trump.
When Mr. Trump lashed out at G.M. on Friday, executives at both companies were stunned. G.M. executives were furious Mr. Trump would attack the company after it had made so much progress in a week and the administration had earlier been supportive of their effort.
“What we’ve accomplished in five days is incredible,” Larryson Foltran, who works in a technology support group at G.M., wrote on Facebook, noting he had been working 14 to 18 hours a day. He said that the president’s posts had bothered him “on a deeper level.”
Carnival, the hard-hit cruise company, has already tapped a $3 billion credit line and said in regulatory filings that it was looking for new financing. The cruise company is working with Wall Street banks to line up investors for a high-interest debt offering, said one person briefed on the matter but not authorized to speak publicly.Carnival, the hard-hit cruise company, has already tapped a $3 billion credit line and said in regulatory filings that it was looking for new financing. The cruise company is working with Wall Street banks to line up investors for a high-interest debt offering, said one person briefed on the matter but not authorized to speak publicly.
It’s one of just many corporations across a wide swath of industries and in vastly different financial straits that are being forced to stretch their cash, cut costs, avoid loan defaults and prepare to potentially reorganize their businesses.It’s one of just many corporations across a wide swath of industries and in vastly different financial straits that are being forced to stretch their cash, cut costs, avoid loan defaults and prepare to potentially reorganize their businesses.
For one group in the financial services industry — restructuring and bankruptcy advisers and lawyers — the emerging signs of pain for companies, both big and small, spell booming business.For one group in the financial services industry — restructuring and bankruptcy advisers and lawyers — the emerging signs of pain for companies, both big and small, spell booming business.
Companies that depend heavily on consumer spending are especially troubled. Restructuring advisers expect retailers — whose financial position was already stretched because of the rise of e-commerce — to run into further trouble as people cut back on shopping. Hoteliers, cruise lines, restaurants, event sponsors and mortgage lenders are among those suddenly short on cash, with travel and outdoor activity at a standstill and unemployment soaring.Companies that depend heavily on consumer spending are especially troubled. Restructuring advisers expect retailers — whose financial position was already stretched because of the rise of e-commerce — to run into further trouble as people cut back on shopping. Hoteliers, cruise lines, restaurants, event sponsors and mortgage lenders are among those suddenly short on cash, with travel and outdoor activity at a standstill and unemployment soaring.
Public health officials have known for years that the United States lacked enough ventilators, making the nation vulnerable to a pandemic. The government sought to address the issue 13 years ago by building a fleet of inexpensive portable devices that could be used in a health crisis.
It failed.
Despite a budget and federal contracts, the marketplace ultimately killed the effort. The small California company hired to design the ventilator was acquired by a multibillion-dollar conglomerate in 2012 as the medical device industry was undergoing rapid consolidation.
But government officials suspected that the acquiring company, Covidien, had bought the device maker to prevent the introduction of a cheaper machine that would undercut its existing ventilator business. After the takeover, executives said the project was insufficiently profitable and wanted to terminate the contract. The government acceded and in 2014 awarded the business to a Dutch company.
According to a spokeswoman at the department of Health and Human Services, the new ventilators are on their way. “We are expecting them soon,” she said.
China’s vast manufacturing machine has moved into overdrive to supply the country and the world with masks, respirators and other equipment to fight the coronavirus pandemic. Chinese-made masks have been part of aid packages sent to Europe, developing countries and the United States, as China has tried to improve its public image after a disastrous attempt to play down its virus-related crisis in January.
But even as it encourages production, the Chinese government has also had to step up enforcement efforts to stop defective and uncertified products. That presents a challenge to officials who have to ensure that quality standards are met even as they push factories to make what the world needs.
One man made fake Honeywell N95 respirators at a makeshift factory on a farm. Pharmacies sold ineffective knockoffs of a Chinese version of Clorox. In one Chinese province, the authorities seized more than seven million masks that were substandard, mislabeled or counterfeited.
“Every time when something major happens in society like this virus outbreak, there is a lot of demand and different kinds of companies try to get in,” said Cody Zhang, the chief executive of a start-up seeking certification for its own products, including a disinfecting robot. “It becomes hard at the beginning to figure out which ones are good and which ones are bad.”
Workers at Instacart, a tech business that delivers groceries and other goods ordered through its app, plan a nationwide strike Monday, arguing that they lack adequate virus protection.Workers at Instacart, a tech business that delivers groceries and other goods ordered through its app, plan a nationwide strike Monday, arguing that they lack adequate virus protection.
The service, long popular in Silicon Valley, has exploded across the country as people are told to stay home to prevent further spread of the disease.The service, long popular in Silicon Valley, has exploded across the country as people are told to stay home to prevent further spread of the disease.
The company’s 200,000 delivery workers are independent contractors, and the app is not tied to any specific retailer. Instacart has agreements with more than 350 businesses, including Costco, CVS Pharmacy and Target.The company’s 200,000 delivery workers are independent contractors, and the app is not tied to any specific retailer. Instacart has agreements with more than 350 businesses, including Costco, CVS Pharmacy and Target.
But delivery workers say Instacart is “profiting astronomically off of us literally risking our lives, all while refusing to provide us with effective protection, meaningful pay and meaningful benefits.”But delivery workers say Instacart is “profiting astronomically off of us literally risking our lives, all while refusing to provide us with effective protection, meaningful pay and meaningful benefits.”
They’re demanding personal protection equipment, hazard pay of an extra $5 per order and at least 10 percent tip on each order total.They’re demanding personal protection equipment, hazard pay of an extra $5 per order and at least 10 percent tip on each order total.
Facebook announced Monday that it would give out $25 million in grants to local news organizations and spend $75 million in marketing that will go to news outlets internationally. In an interview, executive Campbell Brown acknowledged that Facebook, whose huge chunk of online ad revenue helped dent media companies’ business models in the first place, felt a “responsibility” to help out.Facebook announced Monday that it would give out $25 million in grants to local news organizations and spend $75 million in marketing that will go to news outlets internationally. In an interview, executive Campbell Brown acknowledged that Facebook, whose huge chunk of online ad revenue helped dent media companies’ business models in the first place, felt a “responsibility” to help out.
The Australian government announced a wage subsidy plan on Monday that will pay businesses roughly 70 percent of the median wage to prevent millions of workers from losing their jobs because of the coronavirus outbreak. Disney joined other conglomerates in slashing salaries for executives by up to 30 percent. Bob Chapek, Disney’s new chief executive, said in a companywide email that he would take a 50 percent reduction and that Robert A. Iger, the executive chairman, would forgo his salary altogether, which totals $3 million annually according to securities filings.
American Media Inc., the publisher of The National Enquirer, Men’s Journal, Us Weekly and other titles, is cutting the pay of its employees more than 20 percent. It’s the latest instance of a media company trying to slim down. Last week, BuzzFeed announced temporary payroll cuts.American Media Inc., the publisher of The National Enquirer, Men’s Journal, Us Weekly and other titles, is cutting the pay of its employees more than 20 percent. It’s the latest instance of a media company trying to slim down. Last week, BuzzFeed announced temporary payroll cuts.
Reporting was contributed by Stanley Reed, Kenneth P. Vogel, Jim Tankersley, Jeanna Smialek, Alexandra Stevenson, Matthew Goldstein, Sapna Maheshwari, Mary Williams Walsh, Tiffany May, Derrick Bryson Taylor, Damien Cave, Edmund Lee, Marc Tracy, Nicholas Kulish, Sarah Kliff, Jessica Silver-Greenberg, Daniel Victor and Carlos Tejada. Reporting was contributed by Stanley Reed, Kenneth P. Vogel, Jim Tankersley, Jeanna Smialek, Alexandra Stevenson, Matthew Goldstein, Sapna Maheshwari, Neal E. Boudette, Andrew Jacobs, Mary Williams Walsh, Tiffany May, Derrick Bryson Taylor, Damien Cave, Edmund Lee, Marc Tracy, Brooks Barnes, Nicholas Kulish, Sarah Kliff, Jessica Silver-Greenberg, Daniel Victor and Carlos Tejada.