Several US institutions were affected by the outbreak of the Corona virus, which occurred in the United States last March, due to the consequences of isolation and closure measures, and the results were disastrous for some while others succeeded in overcoming the crisis.
The FACT Set Foundation - according to the French Press Agency - stated that the profits of the 500 largest companies listed on Wall Street are expected to decrease by 44%, compared to the same period last year, but it is difficult to determine the effects of an unprecedented health crisis on the activity of each a company.
Several companies decided to refrain from publishing forecasts due to an unpredictable epidemic, as no sector can be immune to the consequences of the crisis.
And the energy companies that witnessed the collapse of oil prices expect to zero their profits, just as it is expected that the companies that sell luxuries in such situations, such as clothes, tickets and cars, will be harmed.
Evidence of this is the bankruptcy of big names in these sectors such as JCPenney, hertz and Chesapeake Energy.
Fluctuations and variations in performance
"On the contrary, the currently popular sectors such as technology and health will see their profits decline, but by only 10% or less," says Knight Thoftt, who is in charge of investment strategy at Manulife Asset Management.
The groups that managed to cope with the crisis were also able to reduce losses. Nike announced that its electronic sales jump from March to May last year by 75%, allowing part of its losses to be compensated for the closure of its stores.
The companies witnessed several fluctuations during the whole season, between last April, in which isolation measures and a gradual easing of restrictions were circulated in May and June, and a variation in performance may be recorded within the same sector as companies that depend on consumer spending.
Specialized company Ernst & Young says e-commerce platforms have flourished, stores that sell essential goods such as toilet paper and food have posted big profits, and household and gaming sales have improved.
In addition, other unnecessary sectors, such as restaurants, clothing and supermarkets, were affected, while the areas of entertainment and travel have completely stopped working.
Difficulty assessing the crisis
It is difficult to assess the costs of the various measures companies have taken to cope with this emergency, whether in terms of teleworking or otherwise, and have also attempted to cut some of the expenses, such as the value of the amounts repaid to their shareholders.
S&P Dow Jones Indices reported that companies listed on the New York Stock Exchange paid 42.5 billion dollars less in the second quarter of the same period in 2019, the largest decline since the first quarter of 2009, The performance of companies will also depend on their own strategy.
For example, analysts are asking about the sums allocated by major banks, which will start this week to disclose their results, to deal with bad loans.
Joshua Mahoney of IG says that banks depend heavily on the health of the economy, so that in times of crisis one should expect the activity of individuals to be affected.
He adds that some of them will be able to rely on brokerage activity by taking advantage of the fluctuations in the financial markets that witnessed many unrest.
And if investors study corporate accounts closely, special focus will be placed on their forecasts for the coming months to determine whether the recent rise in Wall Street was justified. The Dow Jones recorded an increase of 18% in the second quarter, an increase not recorded since 1987.