Stocks in Asia Fall as Investors Brace for Grim U.S. Jobs Data: Live Updates

Asian markets continue Wall Street’s slump.

Asian markets fell on Thursday after Wall Street’s slump, with investors expecting new government and corporate figures to further spell out the economic damage from the coronavirus outbreak.

Japan led major markets in the Asia-Pacific region lower, though the drops failed to match a 2.2 percent tumble in the S&P 500 on Wednesday. Futures markets were predicting glum openings for major markets in Europe and the United States as well.

Investors were selling ahead of what was expected to be another spate of bad economic news. Weekly unemployment claims data in the United States were expected on Thursday to show another mass shedding of jobs, and more companies are scheduled to report the hit to their financial results during the first three months of the year.

In Japan, the Nikkei 225 index was down 1.2 percent at midday. Australia’s S&P/ASX 200 index was down 1.1 percent. In Hong Kong, the Hang Seng index was down 0.7 percent. South Korean shares fell, too, with the Kospi index down 0.3 percent.

But not all market indicators were negative. The Shanghai Composite index was up, and prices for U.S. Treasury bonds, a traditional investment safe haven, slipped in Asia trading. Oil prices rose in futures markets.

Most economists expect China’s first-quarter economic data to show a drop.

For more than four decades, China has never acknowledged that its economy actually shrank, even during major economic crises. But that may change on Friday, when the country announces gross domestic product for the January-to-March quarter.

China’s National Bureau of Statistics already confirmed last month that domestic industrial production, retail sales and investment all suffered record, double-digit drops in the first two months of this year compared with the same period of 2019. That has prompted most, though not all, economists to guess that overall economic performance for the first quarter of this year will show a drop from a year earlier.

The question is how big a drop it will be.

One survey of 18 Chinese and foreign institutions by Caixin, a Chinese news organization, found that they were forecasting that the economy was anywhere from flat to down 11.5 percent in the first quarter. The average forecast was for a drop of 6.6 percent.

A broader survey by Reuters of 57 analysts found an even wider range of predictions — anywhere from a nose-dive of 28.9 percent to a gain of 4 percent. But the average in the Reuters survey, a loss of 6.5 percent, was practically identical to Caixin’s.

Foreign banks, which come under only slightly less political pressure than Chinese institutions to issue sunny forecasts, have tended to be at the bearish end of the range.

New U.S. data is expected to show millions more filing unemployment claims.

Each day seems to bring unwelcome economic milestones. Another is expected to arrive Thursday with the fourth-straight weekly tally of new unemployment claims likely to be in the millions.

Ahead of the Labor Department report, due at 8:30 a.m., the consensus estimate cited by Bloomberg is 5.5 million new unemployment claims. Torsten Slok, chief economist at Deutsche Bank Securities, is expecting a number around eight million. His assumption is based on the earlier inability of many workers to file claims because of technical glitches at overwhelmed state labor departments.

If Mr. Slok’s estimate is right, it would bring the cumulative U.S. job losses to 25 million.

“All of the last decade in job gains will be undone in four weeks, which is a truly stunning statistic,” he said. “It tells you the severity of the situation.”

And it will be only the latest measure. On Wednesday, the Commerce Department reported the steepest monthly drop in retail sales since those statistics started being compiled nearly 30 years ago, and the Federal Reserve said industrial production had recorded its biggest decline since 1946.

The mounting unemployment numbers seem certain to fuel the debate over how long to impose stay-at-home orders and restrictions on business activity.

President Trump has said some measures should be relaxed soon because of the impact on workers. “There has to be a balance,” he said at a news briefing Wednesday evening. “We have to get back to work.”

The global economy may be permanently changed, even after it recovers.

Who would have thought that a crisis that began with mortgage defaults in American suburbs in 2007 would lead to a fiscal crisis in Greece in 2010? Or that a stock market crash in New York in 1929 would contribute to the rise of fascists in Europe in the 1930s?

In the years ahead, we will learn what happens when the infinitely complicated web of interconnections that makes up the world economy is torn apart. And it opens the possibility of a global economy completely different from the one that has prevailed in recent decades.

“This is a period of radical uncertainty, an order of magnitude greater than anything we’re used to,” said Adam Tooze, a historian at Columbia University and author of “Crashed,” a study of the extensive global ripple effects of the 2008 financial crisis.

Crises have a way of bringing to the fore issues that are easy to ignore in good times.

One obvious candidate is globalization, in which companies can move production wherever it’s most efficient, people can hop on a plane and go nearly anywhere, and money can flow to wherever it will be put to its highest use. The idea of a world economy with the United States at its center was already falling apart, between the rise of China and the United States’ own turn toward nationalism.

There are signs that the coronavirus crisis is exaggerating, and possibly cementing, those changes.

The leaders of United Airlines issued a dire note to the carrier’s 100,000 employees on Wednesday, warning that staffing cuts may be coming and demand for air travel is likely to remain subdued into next year.

“The challenge that lies ahead for United is bigger than any we have faced in our proud 94-year history,” the airline’s chief executive, Oscar Munoz, and president, J. Scott Kirby, wrote in the letter, which was posted on the company’s website.

Traffic in the first two weeks of April was down 97 percent from last year and the airline now expects to fly fewer passengers in all of May than it flew in a single day during the same month last year, the executives wrote. And that decline is expected to last even as health concerns linger and travel restrictions are lifted at different times around the world.

The airline said earlier on Wednesday that it expected to receive $5 billion of federal funding intended to pay airline workers through September, but that stimulus is unlikely to prevent cuts beyond that, the executives warned on Thursday.

“The challenging economic outlook means we have some tough decisions ahead as we plan for our airline, and our overall workforce, to be smaller than it is today, starting as early as October 1,” they said.

The leaders struck a markedly different tone from the chief executive of American Airlines, Doug Parker, who said in a CNBC interview earlier in the day that he saw some “indications that the world is ready to start traveling again.”

Amazon said Wednesday that it would temporarily halt its operations in France after a court ruled the company had failed to adequately protect warehouse workers against the threat of the coronavirus and that it must restrict deliveries to only food, hygiene and medical products until it addressed the issue.

Amazon contested the findings of the ruling, handed down Tuesday by a civil court outside of Paris, and said it would appeal. The court had given the company a deadline of Wednesday evening to carry out the order or face a fine of 1 million euros (nearly $1.1 million) per day.

“We have suspended activities in our distribution centers in France, despite the huge investment we have made to ensure and strengthen safety measures for our employees,” Amazon said in a statement, adding that it was “perplexed” by the court’s decision. The threatened fine was too steep to risk not complying, Amazon added.

The company lashed out at unions that had brought the court case despite what it said was “concrete evidence” that it had worked to strengthen safety measures at its six mammoth warehouses around France. The ruling “is likely to have consequences for many people in our country,” including thousands of employees, Amazon customers and French businesses that make sales on Amazon’s platform, it added.

Laurent Degousée, a representative of SUD-Commerce, the main union that filed the lawsuit, said he had learned that Amazon was expected to halt its French operations as of Thursday for five days to enhance safety measures and provide its 10,000 workers full pay during that time. Amazon did not provide details on the furloughs, but said it was asking employees to stay home this week, and that it would assess the implications for its French operations.

Gov. Gavin Newsom of California signed an executive order Wednesday directing the state’s unemployment agency to pay benefits to workers like drivers for Uber and Lyft through a federal assistance program for the self-employed.

The move appears at odds with the rules of the program, however, and could create a conflict between the state and federal governments.

A recently enacted California law effectively requires companies like Uber and Lyft to classify their workers as employees, qualifying them for traditional unemployment benefits. As a result, they appear ineligible for benefits under the federal program for the self-employed, known as Pandemic Unemployment Assistance.

A senior U.S. Labor Department official told reporters on Wednesday that recipients of the pandemic assistance have to be ineligible for traditional unemployment benefits.

The California labor secretary, Julie A. Su, said in an interview that she believed that the state’s move was legal because the federal government had “emphasized flexibility” in processing the emergency aid.

Uber and Lyft have long insisted that their drivers are contractors, not employees, and are challenging the California law in court. But they have urged their drivers nationwide to apply for the pandemic assistance.

Before the executive order, some Uber and Lyft drivers successfully claimed unemployment benefits in California. But the process could take months because the companies refused to submit income data needed to verify eligibility.

Lockdowns make it clear that personal technology needs are simple.

A computer, communications tools, entertainment and a good internet connection are all the technology that most of us need to work and stay sane while stuck inside our homes, says our Tech Fix columnist, Brian X. Chen.

That means we don’t have to spend a lot of money on the latest devices, although investing in a new router can significantly boost the speed of your internet connection.

This short list can guide our priorities in tech consumption even after we come out of this uncertain period. It also means that we don’t have to spend much money to maximize our happiness with tech.

Tech you don’t need: That smart speaker from Amazon or Google or that phone with the foldable screen. If it doesn’t help you do work, stay connected and feel entertained, you can find other ways to spend your money.

Catch up: Here’s what else is happening.

  • The S&P 500 dropped more than 2 percent on Wednesday, as new data showed a historic plunge in retail sales and a slump in factory output.

  • Gov. Newsom of California said that the state would extend aid to undocumented workers, many of whom have been unable to get federal relief during the pandemic despite paying local and state taxes.

  • UnitedHealth Group, one of the nation’s major insurers, reported that its earnings increased this past quarter, adding that the costs of the pandemic were offset by the cancellations of routine medical appointments and elective surgeries.

  • The Paycheck Protection Program, a federal program to help small businesses weather the pandemic, is in danger of running dry amid a disagreement between congressional leaders and the White House over how to replenish it.

Reporting was contributed by Neil Irwin, Nelson D. Schwartz, Liz Alderman, Keith Bradsher, Niraj Chokshi, Caitlin Dickerson, Miriam Jordan Jim Tankersley, Emily Cochrane and Emily Flitter Reed Abelson, Sapna Maheshwari, Ben Casselman, Noam Scheiber, Carlos Tejada and Mike Ives.

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