Updated March 12, 2020
Many are focused on the coronavirus itself, however, the impacts reach much farther than physical health. They are affecting the economy and everyday life.
Businesses big and small have felt the economic effects of COVID-19. The outbreak has impacted many major industries, from technology and entertainment to food and fashion. Everything from material suppliers for companies to direct shipping to customers has been affected, and companies are now finding it harder to obtain parts for products.
Big businesses with factories and suppliers in China are arguably at the greatest risk. Companies like Apple, Disney, Nike, McDonald’s and Hyundai have relied on China’s factories, and are now temporarily shutting down stores, restaurants, offices and theme parks.
According to Forbes Magazine, as of Jan 31. more than 421 companies talked about COVID-19 on first quarter earnings calls.
The NY Times states that on Feb. 17, Apple cut its quarterly sales expectations and warned that the virus threatened global supply chains.
As of Jan 28., Starbucks closed more than half of its 4,100 stores in mainland China.
H&M closed 45 locations, and Under Armour told investors on Feb. 18 that its revenues in the first few months of 2020 would take a hit of $50 to $60 million.
Many companies have also called for travel restrictions, banning employees from traveling to China. On March 11, President Trump announced a 30-day travel ban on the entry of Europeans to the U.S., excluding the U.K..
Airline stocks have been among the hardest hit by COVID-19. As of March 12, Delta, American Airlines and United Airlines have suffered a 10% drop, the NY Times describing the situation as travel stocks being “clobbered.”
Stock markets fell globally. According to the NY Times, major benchmarks are down. On March 12, there was a 7% drop in the U.S. S&P 500, enough to set off an automatic 15-minute trading halt called a circuit breaker. After the halt, stocks remained down by about 7%.
Overall, investors are worried about a global economic slowdown. The NY Times states that investors have been on edge since the start of the crisis, considering the major role that China’s factories play in global business.