The outbreak of the coronavirus has dealt a shock to the global economy with unprecedented speed. Following are developments Thursday related to the global economy, the work place and the spread of the virus.
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EARNINGS RESULTS: The busiest week of the earnings season continues, with companies making gains in some areas of their business but struggling in others.
— American Airlines reported a staggering loss of $2.24 billion for the first quarter, when the coronavirus pandemic triggered a sharp drop in air travel.
— Most McDonald’s restaurants in the U.S. and China are now open for drive-thru and delivery, but global lockdown orders still took a bite out of the company’s first-quarter sales. The chain’s sales fell 6% to $4.71 billion in the January-March period. Declines have persisted in April.
— Comcast’s net income slid in the first three months of the year as the pandemic forced it to shut down theme parks and its movies were kept out of closed theaters.
Comcast lost 409,000 cable TV customers, the biggest source of the company’s profits, as cord-cutting accelerated. But it added 477,000 internet customers, which it said was its best quarterly number in more than a decade. It came as U.S. workplace shutdowns began in March and a mass work-from-home migration underscored the role home internet plays in Americans’ lives.
— Twitter reported Thursday that average daily users grew 24% year over year, the highest ever growth rate in the company’s history. The company said growth was driven by seasonal strength, product improvements and interest in coronavirus.
— Facebook reported its slowest quarterly growth as a public company, pressured by the coronavirus pandemic and a resulting global slowdown in digital advertising.
— Tesla eked out a first-quarter net profit and CEO Elon Musk went on a rant about the legality of government stay-home orders issued to prevent the virus from spreading. The company suspended its near-term profit outlook.
— Ongoing demand for Microsoft’ s cloud computing services helped soften the blow of the pandemic on the software giant’s other products during the first three months of the year.
CENTRAL GOVERNMENT & BANKS: Nations are continuing attempts to reopen businesses. But evidence of the economic damage from the virus is widespread.
— Spain’s economy shrunk by 5.2% in the first three months of the year. That breaks with 25 consecutive periods of positive economic activity going back to 2013.
Spain’s National Institute of Statistics said Thursday that the drop in economic activity came after 0.4% growth in the final quarter of 2019.
— Ukrainian authorities have opened all 872 food markets in the country as the government prepares to gradually lift a lockdown enacted on March 12.
The decision to reopen the markets comes after a series protests all around Ukraine, during which entrepreneurs and farmers bemoaned the dire economic straits the lockdown has put them in.
— Greece’s prime minister is outlining steps his center-right government is taking to aid the economy during the pandemic.
Prime Minister Kyriakos Mitsotakis announced plans this week to ease lockdown restrictions over two months, starting May 4. Greece is widely expected to follow other European countries into recession in 2020.
ENERGY: Countries are currently grappling with an overabundance of oil supply. Some oil contract holders were forced to pay people to take crude off their hands last week. The price of U.S. crude has plunged 80% this year.
— President Donald Trump expects to announce a plan soon to aid the U.S. oil industry.
Treasury Secretary Steve Mnuchin says that administration officials are studying multiple options to assist the sector, including potentially stockpiling another several hundred millions of barrels of oil in the strategic reserves.
— Norway will reduce its off-shore oil production. Energy minister Tina Bru said Thursday that Norwegian production will be cut by 250,000 barrels per day in June and by 134,000 barrels per day in the second half of 2020. The start of production of several fields will be delayed until next year.
Norway accounts for approximately 2% of global oil production.
MARKETS:
— Stocks are opening lower on Wall Street as more grim news piles up about the damage that lockdowns related to the coronavirus are causing the global economy.
CONSUMER: People are stocking up on essential supplies, and major retailers start setting plans to reopen stores.
— Monthly U.S. production of tissue paper — which is used for toilet paper and paper towels — reached a 13-year high in March. The American Forest and Paper Association said U.S. paper mills produced 700,000 tons of tissue, or more than 4 pounds for each U.S. resident, during the month. The association said deliveries of tissue paper to companies that make the final products were also at a record high.
— Macy’s is confirming that it plans to reopen 68 department stores Monday, in states including South Carolina and Georgia. It expects to have all of its nearly 800 stores reopened in six weeks, assuming that the virus spread tapers off and local restrictions ease. All of Macy’s stores have gone dark since mid-March, and the majority of its employees have been furloughed. That follows Best Buy, the nation’s largest consumer electronics chain, which said earlier this week it’s reopening 200 of its stores nationwide in early May for customers making appointments. In mid-March, Best Buy had shuttered its stores for customers and pivoted to curbside pickup.