Furloughs Surpass 1 Million With T.J. Maxx Adding to Retail Toll

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Employee furloughs in the retail industry are now well over 1 million after the owner of T.J. Maxx and Marshalls, one of America’s biggest clothing store chains, suspended its store workers.

TJX Companies Inc. said Tuesday that it would furlough the majority of its U.S. workforce at stores and distribution centers. It employs about 286,000 people worldwide, with most based in the U.S. Employees will be paid through April 11 and those eligible will retain benefits while furloughed.

Retailers across the country stopped issuing paychecks en masse over the past two weeks after shutting down their stores in March due to the coronavirus outbreak. Several of America’s largest retail employers, including Macy’s Inc., Kohl’s Corp., Gap Inc., Ross Stores Inc. and Victoria’s Secret owner L Brands Inc., have made the move to save on labor costs and conserve cash while stores remain closed.

More than 200,000 stores have temporarily closed, according to research firm GlobalData Retail, as Americans obey stay-at-home orders to curb the spread of the virus. Re-opening dates have been pushed back as the outbreak worsened.

TJX closed all of its roughly 3,300 T.J. Maxx, Marshalls, HomeGoods and HomeSense locations in the U.S. on March 19. The retailer’s online shops have shut too, and senior management at headquarters will take pay cuts.

Executives will take “comparable actions” with some of their employees abroad as well, where it has an additional 1,400 stores in Canada, Australia and Europe.

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Asian Markets Mostly Higher

Asian stock markets are mostly higher on Wednesday despite the overnight losses on Wall Street amid lingering concerns about the coronavirus pandemic. Meanwhile, results of a private survey showed that China’s manufacturing activity expanded in March, after deteriorating the most on record in February due to the strict measures taken to stem the spread of the coronavirus pandemic.

The Australian market is notably higher, mirroring a similar surge in the previous session. Upbeat local economic data helped boost sentiment. Mining and oil stocks are among the leading gainers.

The benchmark S&P/ASX 200 Index is gaining 164.30 points or 3.24 percent to 5,241.10 and the broader All Ordinaries Index is climbing 161.10 points or 3.15 percent to 5,271.70. Australian stocks gave up early gains to end sharply lower on Tuesday.

In the mining space, Rio Tinto is gaining almost 5 percent, BHP is rising more than 4 percent and Fortescue Metals is higher by more than 3 percent.

In the oil sector, Oil Search is climbing almost 17 percent, Santos is gaining more than 10 percent and Woodside Petroleum is higher by more than 8 percent after crude oil prices rose almost 2 percent overnight.

Among the big four banks, Commonwealth Bank is advancing more than 1 percent, while Westpac and National Australia Bank are adding 0.2 percent each. ANZ Banking is down 0.3 percent.

Among gold miners, Evolution Mining is declining 0.7 percent and Newcrest Mining is down 0.2 percent after gold prices tumbled overnight.

Transurban Group said toll prices will increase in Sydney and Melbourne from Wednesday despite a fall in traffic volume amid the coronavirus lockdown measures. The company also reported a fall in average daily traffic volume on its toll roads in March. The toll road operator’s shares are edging down 0.1 percent.

Kathmandu Holdings said it will raise NZ$207 million to strengthen its balance sheet after reporting a nearly 42 percent fall in first-half net profit. The outdoor apparel and equipment maker’s shares are in a trading halt.

Fonterra said its New Zealand milk exports declined 6.1 percent in February and it will scale up ethanol production to help sanitiser makers meet the demand amid the coronavirus pandemic. The dairy giant’s shares are unchanged.

On the economic front, the latest survey from the Australian Industry Group revealed that the manufacturing sector in Australia climbed back into expansion in March, with a seasonally adjusted Performance of Manufacturing Index score of 53.7.

That’s up sharply from 44.3 in February, and it moves back above the boom-or-bust line of 50 that separates expansion from contraction after four months under water.

The Australian Bureau of Statistics said the total number of building permits issued in Australia was up a seasonally adjusted 19.9 percent on month in February, coming in at 15,698. That beat expectations for an increase of 3.0 percent following the 15.3 percent decline in January.

The Reserve Bank of Australia will today release the minutes from its emergency meeting on March 19. At the meeting, the RBA cut its key interest rates further to a record low 0.25 percent from 0.50 percent and launched a money printing scheme as the spread of COVID-19 continued to disrupt economic activity and financial markets around the world.

In the currency market, the Australian dollar is lower against the U.S. dollar on Wednesday. The local unit was quoted at $0.6136, compared to $0.6190 on Tuesday.

The Japanese market is declining and the safe-haven yen strengthened following the negative cues overnight from Wall Street. In addition, weak local economic data weighed on sentiment.

The benchmark Nikkei 225 Index is losing 251.20 points or 1.33 percent to 18,665.81, after touching a low of 18,517.47 earlier. Japanese stocks closed lower on Tuesday.

Market heavyweight SoftBank is advancing more than 1 percent, while Fast Retailing is declining more than 1 percent.

The major exporters are lower on a stronger yen. Mitsubishi Electric is losing almost 2 percent, Sony is lower by more than 1 percent, Canon is down 0.5 percent and Panasonic is declining 0.6 percent.

In the tech space, Advantest is lower by more than 3 percent and Tokyo Electron is down almost 1 percent.

In the oil sector, Inpex is down 0.2 percent, while Japan Petroleum is rising almost 3 percent after crude oil prices rebounded overnight.

Among the other major gainers, JFE Holdings is rising more than 3 percent and Nippon Steel is higher by almost 3 percent. NEC Corp., Sumitomo Heavy Industries and Sumitomo Metal Mining are advancing more than 2 percent each.

On the flip side, Nippon Suisan Kaisha is losing almost 8 percent and ANA Holdings is falling more than 7 percent. Nisshin Seifun Group and Nippon Sheet Glass are lower by more than 6 percent each.

On the economic front, the Bank of Japan’s quarterly Tankan Survey on business sentiment showed that large manufacturing in Japan weakened again in the first quarter of 2020, with a diffusion index score of -8. That actually beat forecasts for a reading of -10, as expectations were very soft because of the global COVID-19 pandemic. It was down from a score of 0 three months ago.

The latest survey from Jibun Bank revealed that the manufacturing sector in Japan continued to contract in March, and at a faster rate, with a manufacturing PMI score of 44.8. That’s down from 47.8 in February and it slips further beneath the boom-or-bust line of 50 that separates expansion from contraction.

In the currency market, the U.S. dollar is trading in the upper 107 yen-range on Wednesday.

Elsewhere in Asia, New Zealand and Indonesia are advancing more than 1 percent each, while Shanghai, Taiwan and South Korea are also higher. Singapore is losing 1 percent, while Malaysia and Hong Kong are also lower.

On Wall Street, stocks recovered from initial weakness but moved back to the downside over the course of the trading session on Tuesday. Traders reacted positively to separate reports on consumer confidence and Chicago-area business activity, which showed deteriorations in March but still came in well above economist estimates. The pullback reflected lingering concerns about the economic impact of the coronavirus pandemic, as New York Governor Andrew Cuomo said confirmed cases in his state jumped to more than 75,000 overnight.

The Dow plunged 410.32 points or 1.8 percent to 21,917.16, the Nasdaq slumped 74.05 points or 1 percent to 7,700.10 and the S&P 500 tumbled 42.06 points or 1.6 percent to 2,584.59.

The major European markets all finished a volatile session in positive territory on Tuesday. While the French CAC 40 Index rose by 0.4 percent, the German DAX Index jumped by 1.2 percent and the U.K.’s FTSE 100 Index spiked by 2 percent.

Crude oil prices moved higher on Tuesday, rebounding after a sharp setback in the previous session that sent futures contract crashing to their lowest close in 18 years. WTI crude for May ended up $0.39, or 1.9 percent, at $20.48 a barrel.

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China’s Manufacturing Sector Stabilizes In March

Chinese manufacturers reported a broadly stable business condition in March after deteriorating the most on record in February due to the strict measures taken to stem the spread of coronavirus, or covid-19.

According to the survey conducted by IHS Markit, the manufacturing Purchasing Managers’ Index rose to 50.1 in March from 40.3 in February.

Official PMI survey data, released on Tuesday, showed that the manufacturing sector returned strongly to expansion territory in March. The factory PMI jumped to 52.0 from 35.7 in February.

After widespread company closures and travel restrictions led to a record decline in production in February, an easing of some measures led to a tentative rise in output at the end of the first quarter.

Nonetheless, new orders remained fragile as firms either delayed or canceled orders due to the ongoing pandemic. New export orders fell sharply as global economies grapple with containing the spread of the virus.

Employment dropped at a slower pace in March. Panel members linked the drop to voluntary leavers and efforts to cut cost.

Purchasing activity improved slightly at the end of the first quarter and stocks of finished goods meanwhile rose marginally.

The survey revealed that average lead times for inputs increased at the second-quickest rate in just over 12 years.

Average input costs fell for the first time since August last year. Companies generally passed on lower cost burdens to clients by cutting their selling prices, in hopes of boosting sales.

Business confidence regarding the one-year outlook for output held close to February’s five-year high, with many firms optimistic that demand will pick up once the pandemic situation improves.

“To sum up, the manufacturing sector was under double pressure in March: business resumption was insufficient; and worsening external demand and soft domestic consumer demand restricted production from expanding further,” Zhengsheng Zhong, chairman and chief economist at CEBM Group said.

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Waltons Grow Richer Than Ever With Recession-Resilient Walmart

The fortunes of the Walton family — the pioneers of American bargain shopping — have reached new heights during a pandemic that has otherwise obliterated trillions of dollars of value across global markets.

The combined net worth of siblings Alice, Jim and Rob Walton has climbed 2.6% this year to $165.7 billion as recession-wary shoppers flock to Walmart Inc. stores to stock up on pantry staples. The retailer’s shares jumped 6.1% through Monday, compared with an 18% drop for the S&P 500 Index.

The Bentonville, Arkansas-based company’s dominance of mass-market retail has made its controlling shareholders the world’s richest family. The Waltons own about half of the stock.

Their gains make them an anomaly. The economic contraction caused by the coronavirus pandemic has erased $805 billion from the combined fortunes of the world’s 500 richest people, according to the Bloomberg Billionaires Index.

Just 82 individuals on the ranking have gains this year, led by Amazon.com Inc. founder Jeff Bezos, as orders from house-bound shoppers helped boost his fortune by $7.8 billion to $122.7 billion. Others include Eric Yuan, chief executive officer of Zoom Video Communications Inc., maker of the now-ubiquitous teleconference software.

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China’s Starlight Media & David Steward II’s U.S. Animation Firm Lion Forge Ink Multi-Picture Film Deal Including COVID-19 Project

China’s Starlight Media, which has previously backed Hollywood directors including Sylvester Stallone, Robert Zemeckis and James Wan, has formed a multi-year, multi-project joint venture with David Steward II’s Lion Forge Animation.

The two companies say they will co-finance and co-produce a slate of original animated films as well as projects based on Lion Forge IP.

The first two projects will be a feature re-imagining of classic Chinese novel Journey To The West and an original animated short film inspired by the COVID-19 pandemic. Production on the latter is being fast tracked to start this month.

Under the JV, Starlight will maintain distribution, licensing and merchandising rights in the greater China region (including mainland China, Hong Kong, Macau and Taiwan), while Lion Forge will handle distribution and licensing rights in the rest of the world. Animation work will be carried out at the Lion Forge studios in St. Louis, Missouri.

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Lion Forge, one of the only African American-run animation studios in the world, produced this year’s Oscar-winning animated short Hair Love. Launched last year, the company’s IP includes comics, graphic novels, original content, and celebrity affiliations. Steward II is son of billionaire businessman David Steward and brother of Kimberly Steward whose K Period Media has invested in movies including Manchester By The Sea and Suspiria.

Beverly Hills-based Starlight Media, run by CEO Peter Luo, is a wholly-owned subsidiary of publicly traded Starlight Culture Entertainment Group.

Commenting on the partnership, David Steward II said, “We operate on the premise of championing diversity, so crossing boarders to collaborate with partners like Starlight Media is a move we’re very happy to make in the spirit of achieving a desired content slate that reflects diverse voices and stories. Aligning with Peter and the Starlight team on this joint venture together feels natural because we all share the same goals and philosophy when it comes to creating content. Lion Forge Animation is committed to establishing a strong brand identity that equates to the best animated projects in the world and this strategic partnership allows for greater economies of scale with a premier partner in Starlight that is among the most dynamic and visionary companies in the industry.”

Peter Luo stated, “We have a great deal of admiration and respect for the incredible work that is being done out of Lion Forge Animation and are very excited about this new multi-year, multi-picture partnership that will allow us to create groundbreaking content with family friendly messaging. We want to be in business with Lion Forge Animation because we share a common vision, not just on taste and preferences of films, but on the execution of a business model that will bring high quality, very entertaining films to the marketplace.”

He continued, “This partnership will allow us to bring the highest quality Hollywood content to the Chinese audience, as well as local language adaptations, and merchandising opportunities. The China film industry has been one of the fastest growing industries in the world and we are excited to work with David and the Lion Forge Animation team, who not only have strong passion for the Chinese market, but also respect and understand the differences and uniqueness of the local audience and ecosystem in China. Our partnership will leverage the resources and strengths of both companies to deliver the highest caliber content to a global audience.”

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