Pandemic Triggers a Wave of Distress, Bankruptcy in Corporate America

NEWS SUMMARY: Precious metal prices eased back Monday on short-term profit-taking as lockdown easing boosted risk appetite. U.S. stocks rose as investors mulled over the possibility of re-opening the economy after the coronavirus outbreak.

 WSJ---"Stay-at-home orders and the shutdown of nonessential business have driven broad swaths of the economy into panic mode. In industries that were already in a precarious position before the crisis, including retail and energy, the coronavirus pandemic has tipped many companies over the edge. A host of oil companies have sought chapter 11 protection, while J.C. Penney Co. and Neiman Marcus Group Inc. are expected to file for bankruptcy soon. Companies in areas that were previously stable, such as the automotive, travel and leisure industries - and even health care - may soon face similar pressures. U.S. corporate debt downgraded to selective default, meaning a borrower has failed to meet one or more of its obligations, totaled $64.1 billion for the 12 months ended April 17, according to S&P Global Ratings....In the coming months, that figure could top the roughly $340 billion reached at the height of the financial crisis, according to the worst-case scenario estimates from S&P. Even in a less grim scenario, the figure could approach levels reached after the dot-com bust in the early 2000s. Companies of all stripes are scrambling to avoid a painful reorganization of their capital structures and operations, default or bankruptcy....Should the recession prove deeper than envisioned, there could be a second - potentially bigger - wave of corporate distress later this year as companies labor under the weight of additional debt taken on during the shutdown, advisers warn."