Deep Recession Is Projected for Europe, as Markets Waver: Live Updates

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Latest projection: A deep recession and ballooning unemployment in Europe.

The European Union’s economy is set to shrink by 7.4 percent this year, investment is expected to collapse and unemployment rates, debts and deficits will balloon in the brutal aftermath of the coronavirus pandemic, the European Commission said Wednesday.

To put these figures in perspective, the European Union’s economy had been predicted to grow by 1.2 percent this year, and in its worst recession, in 2009 during the financial crisis, its economy shrank by 4.5 percent.

Predicting the breadth of a recession can be a moving target, the commission admitted, and things could end up being much worse.

“The danger of a deeper and more protracted recession is very real,” the head of the commission’s economic unit, Maarten Verwey, said in the forecast’s foreword. The commission issues these forecasts four times a year.

Italy and Spain, the two countries worst hit by the disease, will see their economies shrink by more than 9 percent each. Greece, which had started turning a corner after a decade of economic calamity, will suffer the most of the union’s 27 nations, according to the forecasts, losing 9.7 of its economic output this year.

And unemployment is expected to be rampant, averaging 9 percent across the bloc and reaching 19.9 percent in Greece, the European Commission said.

The bloc’s biggest economy, Germany, will also be hammered, and its economy is projected to shrink by 6.5 percent for the year. France, the bloc’s second-largest economy, is expected to contract by 8.5 percent this year.

Wall Street set to continue its rally while European markets flag.

ImageWall Street in the Manhattan on Friday.
Wall Street in the Manhattan on Friday.Credit…John Minchillo/Associated Press

U.S. stock futures pared some gains on Wednesday after a report showed that the private sector work force had plunged by an unprecedented 20 million people in April.

The ADP National Employment Report, released on Wednesday morning, gave investors another glimpse of the depth of the damage to the economy as businesses were forced to close amid quarantine lockdowns.

Global stocks have been buoyed this week by prospects of the countries hardest hit by the coronavirus pandemic slowly emerging from economically devastating lockdowns. But other clouds have dimmed investor hopes, like new data from the European Commission predicting a deep recession on the continent this year, and fresh concerns over the risks of the United States restarting its economy too quickly.

On Wednesday, European markets were mixed after Asia-Pacific markets ended mildly higher.

Oil prices, which have rebounded over the past two days, continued their upswing on futures markets. The price of benchmark crude in the United States rose to $25.44 a barrel. Brent crude, the international benchmark, climbed slightly to just over $31 a barrel.

Airlines are burning through $10 billion a month, an industry executive says.

Even as they have substantially reduced service, the largest U.S. airlines are averaging just 17 passengers on domestic flights and 29 on international flights, according to a copy of congressional testimony from the head of Airlines for America, an industry group.

At the same time, airlines are collectively burning through about $10 billion a month as they cut costs and await the return of passengers, Nicholas Calio, the industry group’s chief executive, said in the testimony, prepared for a Senate hearing about aviation on Wednesday.

“While the industry will do everything it can to mitigate and address the multitude of challenges, no factual doubt exists that the U.S. airline industry will emerge from this crisis a mere shadow of what it was just three short months ago,” Mr. Calio said in the prepared remarks.

The pandemic has virtually wiped out air travel with traffic volumes down 95 percent and more than 3,000 aircraft grounded. More than 100,000 airline employees are working reduced hours or have accepted pay cuts or early retirement, Mr. Calio said.

Mr. Calio addressed complaints from some consumers that airlines were strongly encouraging them to take vouchers instead of refunds for canceled flights, saying that if the carriers refunded all canceled tickets at once they might have to seek bankruptcy protection.

He also thanked Congress for injecting nearly $50 billion in grants and loans into the industry in March and said that the funds would help provide stability “throughout a challenging summer, going into a very uncertain fall season.”

How my boss monitors me while I work from home.


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With millions of us working from home in the coronavirus pandemic, companies are hunting for ways to ensure that we are doing what we are supposed to. Demand has surged for software that can monitor employees, with programs tracking the words we type, snapping pictures with our computer cameras and giving our managers rankings of who is spending too much time on Facebook and not enough on Excel.

The technology raises thorny privacy questions about where employers draw the line between maintaining productivity from a homebound work force and creepy surveillance. To try to answer them, Adam Satariano turned the spylike software on himself.

Last month, he downloaded employee-monitoring software made by Hubstaff, an Indianapolis company. Every few minutes, it snapped a screenshot of the websites he browsed, the documents he was writing and the social media sites he visited. From his phone, it mapped where he went, including a two-hour bike ride around Battersea Park in the middle of one workday.

To complete the experiment, he gave his editor, Pui-Wing Tam, the keys to the Hubstaff program so she could track him. After three weeks of digital monitoring, the future of work surveillance seemed to both of them to be overly intrusive.

Face masks and, maybe, shorter lines as Shanghai Disneyland reopens.

After being closed for more than three months, Shanghai Disneyland will greet visitors again on May 11, the first Disney park to reopen after the company closed them amid the coronavirus pandemic.

In China, where the park is a major attraction, many people saw the move as symbolic. “The reopening means the outbreak in China is truly controlled,” a user wrote on Weibo, the Chinese social media platform.

All, however, is not back to normal. Visitors will be required to register personal information online and show that their code is green on China’s health-tracking smartphone app, which authorities have used to rank people’s infection risk. Visitors will have their temperatures checked at the gates. They must wear masks. Crowd sizes will be controlled at restaurants, rides and other facilities. Pictures released by Disney show markings on the ground to help park-goers maintain social distancing.

“Finally, there won’t be a line at the Tron Lightcycle Power Run!” an excited Disney fan wrote, referencing a popular ride. Opened in 2016 as the first Disney park in mainland China, it is known for its hourslong lines.

Not everything will be open. Some attractions, like theater shows and the park’s colorful nighttime parade, will be canceled to limit guest contact.

“To sum up, there will be no pictures together, no theater shows, no wagons and no ‘A Nighttime Spectacular of Magic and Light,’ only the facilities,” wrote one person, adding a face mask emoji.

“What’s the fun if we have to wear a mask all the time and can’t take pictures at Disney?” another wrote. “It’s not a good time to go.”

Sheltering in place, people are panic-buying Peloton bikes.

Peloton, which last year endured a rocky initial public offering and a widely mocked holiday ad, is emerging as a potential winner of the quarantine economy. Gyms, boutique studios and personal trainers have been sidelined, but home workout systems are thriving.

Since mid-March, Peloton’s stock has soared 86 percent, valuing the New York company at $10 billion, or twice as much as the gym chain Planet Fitness. Last month, Peloton reported a record: More than 23,000 people had joined one of its live classes.

When Peloton reports quarterly financial results on Wednesday, Wall Street expects the unprofitable company to post rising sales. Analysts pointed to surges in the number of ratings for fitness classes on Peloton’s system and longer waits for delivery of the bikes, which signal higher-than-expected demand. The results may not reveal the full extent of Peloton’s popularity, because they cover only a few weeks of the lockdown period in March.

“Consumer habits are fundamentally changed coming out of this crisis and this pandemic,” said Ron Josey, an analyst at JMP Securities. “A device and service like Peloton comes to the forefront in that.”

The coronavirus crisis is threatening the push for denser housing.

Transportation and denser housing have been the two focal points of urban residential development for the last decade, as cities like Seattle and San Francisco try to combat a severe shortage of affordable housing. But some developers worry that the coronavirus pandemic will stop the momentum as social distancing and telecommuting become the norm.

In areas where car commute times continue to climb, and freeways are at capacity, building denser communities along transit lines is seen as a panacea.

These projects, known as live-leave developments or more formally as transit-oriented developments, can be no-frills projects that focus on housing and getting people in and out fast. Or they can be more centered on amenities, meant to attract not only residents but commercial developers who find the density attractive for restaurants, coffee shops and boutiques.

Most experts say that the demand for transit-oriented development will still exist in some form after the crisis, but that the pandemic will leave a legacy.

Developers are already starting to consider new design plans. Expect more open spaces, broader sidewalks, slimmer roads and promenades in the future.

Catch up: Here’s what else is happening.

  • General Motors reported first-quarter net income of $300 million, a sharp drop from $2.2 billion a year ago, as the coronavirus took a toll on its operations around the world. The automaker did not immediately provide a forecast for the second quarter, when the impact of the virus will be even greater.

  • The New York Times Company reported on Wednesday that it had netted 587,000 new digital subscriptions in the first quarter and surpassed 6 million total subscriptions by the end of April. But its chief executive, Mark Thompson, warned that advertising revenue had plummeted and could continue to fall by as much as 55 percent in the second quarter.

  • BMW said Wednesday that deliveries of new vehicles plunged 20 percent in the first three months of the year and warned that it is bracing for a long period of depressed sales. The German carmaker said it “expects the consequences of the corona pandemic to constrain the operations of the entire automotive industry for quite some time to come.” Car sales, BMW said in a statement, “are not going to return to normal in the space of just a few weeks.”

  • Norwegian Cruise Line, one of the world’s largest cruise companies, said on Tuesday that there was “substantial doubt” about its ability to survive the coronavirus pandemic. Norwegian acknowledged the dire situation in a securities filing announcing that it was seeking $650 million in new financing.

Reporting and research was contributed by Matina Stevis-Gridneff, Adam Satariano, Marc Tracy, Neal E. Boudette, Jack Ewing, Carlos Tejada, Kevin Williams, Niraj Chokshi, Mohammed Hadi, Lin Qiqing, Katie Robertson and Kevin Granville.