The daily business briefing: February 5, 2020

(Image credit: KAZUHIRO NOGI/AFP via Getty Images)

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1. Japan quarantines cruise ship over coronavirus concerns
2. Macy's announces closure of 125 stores
3. Ford shares fall sharply after disappointing earnings report
4. U.S. stocks continue to bounce back after coronavirus-fueled plunge
5. Disney reports better-than-expected earnings as Disney+ gains subscribers

published 5 February 2020

1. Japan quarantines cruise ship over coronavirus concerns

Japan has quarantined a cruise ship with 3,711 people on board after a man was diagnosed with coronavirus after leaving the vessel in Hong Kong, Japanese authorities said Wednesday. Health Minister Katsunobu Kato said the people on the ship could be quarantined for up to 14 days under Japanese law pending tests on 273 people who showed symptoms of the virus, or had contact with the infected man. About 3,600 people on another cruise ship were undergoing screening in Hong Kong after three passengers were diagnosed with the rapidly spreading virus. Hong Kong announced Wednesday that it would quarantine people arriving from mainland China for up to 14 days, after thousands of Hong Kong hospital workers went on strike calling for closing the border with mainland China, where the outbreak is concentrated.

Macy's plans to shutter 125 of its stores over the next three years, and cut about 2,000 corporate jobs. Thirty of the stores are set to close in 2020, adding to more than 100 store closings since 2015. The company said it would get out of weak shopping malls, rather than focus on opening smaller stores in strip centers. "Our goal is to reclaim and revitalize what a department store should be," Macy's CEO Jeff Gennette told The Wall Street Journal. "Department stores are still vital if they are done right. There is viability to having many categories and brands under one roof." About 400 Macy's stores will remain open. Competition is fierce in the retail world, with Macy's going up against online rivals like Amazon and discount stores like Marshalls.

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Ford shares plunged by 11 percent in after-hours trading on Tuesday after the automaker reported disappointing quarterly earnings. Ford said it lost $1.7 billion, or 42 cents a share, deepening a loss of 3 cents a share in the same period last year. Adjusting for one-time items, Ford gained 12 cents a share on $39.7 billion in revenue. Analysts had expected the figure to come in at 17 cents a share on sales of $39.6 billion. "Financially, the company's 2019 performance was short of our original expectations, mostly because our operational execution — which we usually do very well — wasn't nearly good enough," Chief Executive Jim Hackett said in a statement. "We recognize, take accountability for, and have made changes because of this."

U.S. stock index futures surged early Wednesday, continuing the market's rebound from a selloff last week that was fueled by concerns about economic fallout from China's coronavirus outbreak. Futures for the Dow Jones Industrial Average were up by as much as 300 points or 1 percent several hours before the opening bell. Futures for the S&P 500 and the Nasdaq also gained as much as 1 percent. Global markets remained focused on developments in the effort to contain the virus as the number of cases rose to nearly 25,000 in China, with more than 490 deaths. The Dow gained 1.4 percent on Tuesday. The S&P 500 and the Nasdaq rose by 1.5 percent and 2.1 percent, respectively.

Disney on Tuesday reported quarterly earnings that beat Wall Street's expectations. Earnings came in at $1.53 per share, compared to the $1.44 per share forecast by analysts surveyed by Refinitiv. The entertainment giant said its new Disney+ streaming video service had increased its subscribers to 26.5 million in the quarter, up from 10 million when it launched Nov. 12. CEO Bob Iger said the number had since increased even more, to 28.6 million. The company warned that it would have to keep its Shanghai Disneyland and Hong Kong Disneyland theme parks closed for at least two months due to concerns about China's coronavirus outbreak, resulting in a possible $175 million loss in the upcoming quarter.

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Harold Maass is a contributing editor at The Week. He has been writing for The Week since the 2001 debut of the U.S. print edition and served as editor of TheWeek.com when it launched in 2008. Harold started his career as a newspaper reporter in South Florida and Haiti. He has previously worked for a variety of news outlets, including The Miami Herald, ABC News and Fox News, and for several years wrote a daily roundup of financial news for The Week and Yahoo Finance.