Ariel Investment co-CEO on state of the markets

Mellody Hobson, Ariel Investment co-CEO, joins "Closing Bell" to discuss the state of the markets.

The economic decline, which started in the first quarter is expected to reach its trough in the second quarter. Economists expect an unprecedented drop of more than 30% in GDP for the second quarter. JPMorgan economists expected a 40% decline in the second quarter, on top of a 10% drop in the first quarter.

But now already negative first quarter GDP forecasts may also worsen, showing the economy began contracting at a rapid pace when businesses closed down, states ordered residents to stay home and President Donald Trump told Americans to stay out of restaurants and practice safe distancing.

“Overall, today’s manufacturing numbers indicate an expected slowing in activity, but slightly earlier and more widespread than previously thought,” noted Citigroup economists. The economists noted the depth of the decline in apparel manufacturing of 16.5% and furniture, down 10%, were surprising.

March retail sales also showed barely a blip in online purchases, only up 3.1%, though consumers are shopping from home. The Commerce Department acknowledged it had difficulty collecting data as many businesses have shut down.

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