The outbreak of the coronavirus has dealt a shock to the global economy with unprecedented speed. Following are developments Friday related to the national and global response, the work place and the spread of the virus.
STRESS TESTS: The Federal Reserve is making modifications to the way it performs stress tests on banks due to the virus outbreak.
Vice Chair for Supervision Randal Quarles said Friday that this year’s modifications include adding three new scenarios to see how well banks respond to them. The scenarios include a rapid V-shaped recovery that regains much of the output and employment lost by the end of this year; a slower, more U-shaped recovery in which only a small share of lost output and employment is regained in 2020; and a W-shaped double dip recession with a short-lived recovery followed by a severe drop in activity later this year due to a second wave of containment measures.
Quarles said that the Fed won’t hesitate to take additional policy actions should they be warranted under the then-prevailing economic conditions.
— Penn National Gaming has restarted operations at 30 of its 41 gaming and racing properties, representing more than 70% of its regional gaming portfolio.
Friday will see the reopening of four Ohio properties and the Hollywood Casino at Penn National Race Course in Pennsylvania.
— Smith & Wesson Brands’ fourth-quarter revenue climbed more than 37% to $197 million as consumers demand for firearms increased in March, the period when virus outbreak lockdowns were starting in the U.S.
The company said it’s internal inventories allowed it to address the sudden increase in demand in the quarter.
Smith & Wesson said the quarter’s COVID-19 pandemic-related costs were offset by pandemic-related cost savings, including the cancellation of trade shows, conventions, travel and entertainment.
— CarMax’s earnings tumbled 98% in the first quarter, which included $122 million in its auto finance provision for loan losses, which included an increase of $84 million in its estimate of lifetime losses on existing loans resulting from the coronavirus and worsening economic factors.
Sales and operating revenue dropped 39.8%, with comparable store used unit sales down 42%. CarMax said Friday more than 80% of the days in the quarter were hurt by a mix of store closures and limited operations and occupancy restrictions. However, sales have started to improve: comparable store used unit sales for the two weeks ended June 14 were within 10% of last year’s sales.
— FedEx said Friday it will take $370 million in charges in its fiscal fourth quarter, including a $348 million write-down to cover temporary closures and lost revenue at FedEx Office stores because of the pandemic. The delivery giant also disclosed special stock options and grants for top executives for the next fiscal year. FedEx is scheduled to report results on June 30 for the quarter and fiscal year that ended May 31.
— Glass tableware maker Libbey has filed for to reorganize under Chapter 11 bankruptcy protection, citing the pandemic and the need to address upcoming debt maturities.
In the first quarter the company’s sales fell 14% and its net loss widened, hurt by mandatory shutdowns across the U.S. Libbey supplies tabletop products to retail, food service and business-to-business customers in over 100 countries and said that the food service industry was one of the most directly impacted.
CENTRAL GOVERNMENTS & BANKS:
— Japan and Vietnam have agreed to partially lift travel bans and ease restrictions step by step as a way to reopen economic and bilateral exchanges between the two Asian nations where coronavirus infections have largely been taken under control.
Japanese Foreign Minister Toshimitsu Motegi told reporters Friday that Vietnam is one of four countries that Japan has been discussing resuming mutual visits in phases. Japan is also seeking similar bilateral arrangements with Thailand, Australia and New Zealand.
Japan and Vietnam are discussing final details such as timing of resumption, Motegi said.
Japan has imposed entry bans to 111 nations as part of coronavirus measures.
MARKETS: Wall Street stocks closed slightly lower Friday after worries about worsening coronavirus levels in some states undercut early gains.
WiFi NEEDS: Comcast is extending free access to its 1.5 million public Xfinity WiFi hotspots to anyone who needs them, including non-customers, through the end of the year. The hotspots are available in outdoor and business locations.
Comcast has previously made its public hotspots available for free in individual markets to help communities stay connected after local emergencies like hurricanes in the South, wildfires in California and the recent tornadoes in Nashville.