Stocks fall…IMF downgrades outlook for global economy
NEW YORK (AP) – Stocks are moving lower on Wall Street as investors are discouraged to see a surge in new coronavirus cases in the U.S. to their highest level in two months. The S&P 500 fell 1.3% in early trading, giving up its gains from earlier in the week. Markets have been rallying in recent weeks on hopes that U.S. states and regions around the world could continue to lift lockdowns put in place to slow the spread of the coronavirus. Cruise lines, which would stand to suffer greatly if travel restrictions are extended, were among the biggest losers in early trading.
WASHINGTON (AP) – The International Monetary Fund has sharply lowered its forecast for global growth this year because it envisions far more severe economic damage from the coronavirus than it did just two months ago. The IMF predicts that the global economy will shrink 4.9% this year, significantly worse than the 3% drop it had estimated in its previous report in April. It would be the worst annual contraction since immediately after World War II. For the United States, the IMF predicts that the nation’s gross domestic product – the value of all goods and services produced in the United States – will plummet 8% this year, even more than its April estimate of a 5.9% drop.
NEW YORK (AP) – Americans are likely to see more “for rent” signs in the coming months. That’s because many businesses devastated by the coronavirus pandemic are expected to abandon offices and storefronts. The changes are happening because more employees are working from home, and more people are shopping online. The result could bring an end to the long boom in the nation’s commercial real estate market. Hotels, restaurants and stores that closed in March have seen only a partial return of customers. Many of them may fail. Commercial landlords have reported an increase in missed rent payments. They expect vacancies to rise through the end of the year.
UNDATED (AP) – Health and wellness company GNC Holdings has filed for Chapter 11 bankruptcy protection. It is looking to close at least 800 to 1,200 stores. The company says it’s looking to restructure its balance sheet at the same time it explores finding a potential buyer, with a minimum purchase price of at least $760 million. GNC and all of its subsidiaries remain open for business. The company expects to confirm a standalone plan of reorganization or consummate a sale that will allow the business to exit from the bankruptcy process in the fall.
UNDATED (AP) – Furniture company La-Z-Boy has decided to permanently close its Newton, Mississippi manufacturing plant and reduce its global workforce by approximately 10%. The company had previously closed the majority of its manufacturing operations temporarily and furloughed 70% of its employees as it dealt with plant and store closures tied to the pandemic. La-Z-Boy said in a regulatory filing that it has called back about 6,000 workers.