(Bloomberg) -- BlackRock Inc. Chief Executive Officer Larry Fink said the full extent of the coronavirus pandemic on the U.S. economy’s smaller companies remains unclear, even as cities begin reopening.
“We still have not witnessed the full impact on small and medium businesses,” Fink said in an interview Tuesday on Bloomberg Television.
The virus’s spread forced a shutdown across the country, upending sectors from energy to consumer. Signs of acute pain for small businesses are already showing: about 14% of companies that received support from the Paycheck Protection Program, a key pillar of the U.S. government’s aid to small businesses, expect they’ll need to reduce their workforce after using the loans, according to a new survey from the National Federation of Independent Business.
Last week, 13 U.S. companies sought bankruptcy protection, matching the peak of the global financial crisis, data compiled by Bloomberg show. While larger corporations have stabilized, the fate of other parts of the economy will be determined by how Covid-19 is handled in the coming months, he said.
Fink’s remarks come as the world’s largest asset manager navigates a year of turmoil that includes the pandemic and a wave of protests over racial inequality that began in the U.S. He said he expects market uncertainty, which spiked in mid-March, to remain elevated for months to come.
“We should expect a lot of volatility for the next year,” Fink said. “But let’s be clear, markets have done quite well with all this uncertainty.”
The S&P 500 index shed more than 30% of its value before recovering most of its losses since its low for the year on March 23. With about $6.5 trillion under management, BlackRock counts institutions and retail investors around the world among its clients.
(Updates with survey results in third paragraph.)
For more articles like this, please visit us at bloomberg.com
Subscribe now to stay ahead with the most trusted business news source.
©2020 Bloomberg L.P.