Coronavirus latest: US business leaders call for co-ordinated approach to safely reopen
Emma Boyde 4/23/2020, 11:47:08 PM
New York deaths ease to lowest since April 2
Peter Wells in New York
New deaths in New York, the hardest-hit US state, eased to 438 over the past 24 hours, the lowest daily rate since April 2, taking the total to 15,740.
New Jersey and Michigan, the next hardest-hit states overall, had daily death rates of 305 and 164, respectively, but both are down from record daily increases on Tuesday.
A total of 1,911 people died over the past day, taking the national total to 44,014, according to the data released on Thursday compiled by the Covid Tracking Project.
There were 178 deaths in Massachusetts, which is the fourth-hardest hit overall.
Unlike the Covid Tracking Project, Johns Hopkins University counts co-called presumptive deaths in New York City, which puts its total death count at a higher 47,272.
Emma Boyde 4/24/2020, 12:03:03 AM
Dubai to ease lockdown restrictions from Friday
Simeon Kerr in Dubai
Dubai has confirmed plans to ease its strict lockdown from Friday morning, allowing residents to leave their homes without a police permit for the first time in almost three weeks.
On the eve of the holy fasting month of Ramadan, the government on Thursday said allowing freedom of movement would also require strict preventative measures to curtail the spread of coronavirus, including wearing face masks whenever leaving home.
Public transport, retail, restaurants, hotels and offices will be able to operate at a reduced capacity while enforcing social distancing protocols.
The emirate has been under the tightest restrictions in the Gulf over the past month, including a 24-hour curfew, as the authorities rolled out a massive testing campaign for Covid-19. Residents will now be able to leave their homes without a permit between 6am and 10pm.
People will be allowed to visit family members, but private gatherings remain banned. The public will be able to exercise outside for up to two hours a day in groups of no more than three people.
Emma Boyde 4/24/2020, 12:10:52 AM
Here’s a round-up of some of the latest news you might have missed
Intel’s revenue jumped 23 per cent in the first three months of the year as the new demands of working from home drove up sales of PCs and put more strain on cloud data centres that rely on the company’s chips.
Two British doctors have launched a legal challenge over the UK government’s guidance on personal protective equipment and how it should be used in hospitals.
About 5,000 US meat and food-processing workers have been infected or exposed to coronavirus, and 10 have died, according to estimates from the United Food and Commercial Workers Union.
The Federal Reserve said it would provide names and details of every beneficiary of its lending under the $2.2tn economic stimulus package.
EU leaders have agreed to work on creating a “recovery fund” to rebuild Europe’s economy after the coronavirus pandemic.
The disappearance of petrol demand because of coronavirus lockdowns has forced the shutdown of two of the world’s largest ethanol refineries, owned by Archer Daniels Midland, which process farmers’ corn into biofuel in the US Midwest.
Expedia, the online travel booking company, has raised $3.2bn in fresh capital, including $1.2bn from the private equity firms Apollo Global Management and Silver Lake.
Lufthansa has reported losses of around €1.2bn for the first three months of 2020, as it warned that it would run out of cash within weeks unless it received government aid.
The UN has called for the creation of an international agency to oversee sovereign debt relief programmes for developing countries, which it said face unsustainable debt repayments of $2.6tn this year and $3.4tn in 2021.
Poland is planning new takeover rules that will broaden the government’s powers to block attempts by non-EU investors to buy up Polish companies. The move follows a similar tightening of takeover rules in neighbouring Germany.
A vaccine is only likely to be available to the US public by June 2021, according to forecasts by Morgan Stanley.
Emma Boyde 4/24/2020, 12:20:50 AM
Asia-Pacific stocks slip in early trading over antiviral drug flop
Daniel Shane in Hong Kong
Stocks across Asia-Pacific slipped in early trading on Friday after a potential antiviral drug for coronavirus disappointed in its first randomised clinical trial.
In early trading in the region, Japan’s Topix share index fell 0.8 per cent and Australia’s S&P/ASX 200 edged 0.1 per cent lower.
Overnight, Wall Street’s S&P 500 erased earlier gains to close 0.1 per cent down after draft documents published accidentally by the World Health Organization appeared to show that remdesivir, a drug developed by Gilead Sciences, did not improve Covid-19 patients’ condition.
Futures trading in Asia tipped the US stock benchmark to open 0.3 per cent lower when trading begins in New York later on Friday.
Oil, which traded in negative territory for the first time in history this week, rose. West Texas Intermediate for June delivery added 5 per cent, with the US marker at $17.36.
Emma Boyde 4/24/2020, 1:15:21 AM
Mumbai slum tests India’s coronavirus response
Benjamin Parkin in New Delhi and Andrea Rodrigues in Mumbai
Mumbai’s slums, where an estimated 40 per cent of the city’s 20m population lives, are particularly susceptible to the spread of Covid-19.
In the Dharavi area of Mumbai, thought to be one of Asia’s largest slums, public health experts suspect the true number of infections is far higher than has been detected.
“This was originally a disease of the rich, of people who travelled abroad,” said Ramanan Laxminarayan, founder of the Centre for Disease Dynamics, Economics and Policy, adding that the lockdown was reversing this dynamic.
“The lockdown reduces transmission among people who have space to distance . . . As a result you’re going to see more disease in the poorer areas, in the slums, now.”
Duterte extends greater Manila lockdown for three weeks
John Reed in Bangkok
The Philippine government on Friday morning extended a strict lockdown in greater Manila and several other cities and provinces considered at “high risk” from coronavirus for another three weeks.
President Rodrigo Duterte’s spokesman Harry Roque said that “enhanced community quarantine” would continue until May 15 in the Philippine megacity, where more than 12m people live, and in several other provinces on Luzon island, as well as in the Visayas and in Mindanao, the country’s two other biggest island groups.
Mr Roque said that Mr Duterte decided to extend the lockdown after approving all the recommendations of the government’s inter-agency task force devoted to fighting Covid-19.
The announcement represents a partial easing of one of the strictest lockdowns in Asia announced for all of Luzon, the Philippines economic heartland where more than 50m people live, in mid-March.
Some provinces in Luzon and in other parts of the Philippines that are deemed to be low-risk areas will be put under “general community quarantine” until May 15, with workers allowed to return to their jobs in phases and shopping malls opened for people aged 21 to 59 who pass temperature and ID checks and who are “not looking too sickly”.
As of Thursday, the Philippines had confirmed 6,981 cases of the disease, mostly in metro Manila, and 462 deaths.
George Russell 4/24/2020, 2:57:15 AM
Indonesia bans Ramadan travel in bid to check spread of virus
Indonesia has halted domestic and international air, sea and overland travel from Friday, in a bid to control the spread of coronavirus just as the Islamic holy month of Ramadan begins.
“[There is a] temporary ban on the use of transport facilities for homecoming activities during Lebaran,” said transport ministry spokesperson Adita Irawati, using the Indonesian term for Ramadan, which began on Friday.
She said in a statement posted on the ministry’s website that the decree prohibits travel by “buses, passenger cars, trains, planes, river and lake transport, and ships”.
Freight transport is exempt from the ban.
At the end of May, up to 20m people were expected to travel across the world’s largest Muslim-majority nation to celebrate the end of Ramadan.
The ban on land travel would stay in force until May 31, June 1 for air travel, June 8 for ships and ferries, and June 15 for trains.
Ms Adita said travel in private cars and motorbikes is also banned. Violators caught between Friday and May 7 would be given a warning and directed to return home. After that, violators would be fined and turned back.
Ticket-holders who had already booked would be given full refunds, the ministry said.
Emma Boyde 4/24/2020, 3:16:29 AM
Korea’s Posco reports 45% fall in first-quarter operating profit
Song Jung-a in Seoul
Posco on Friday reported a 45 per cent drop in first-quarter operating profit as the world’s fifth-largest steelmaker feels the pinch from the coronavirus pandemic’s economic fallout.
Operating profit fell to Won458bn ($371m) in the first three months of this year from Won833bn a year earlier. Net profit dropped 32.5 per cent to Won453bn as sales declined 10.8 per cent to Won6.97tn.
The company expects the industry slump to continue as steel demand falls due to the global economic slowdown.
“The difficult situation is likely to continue as demand from our customers including automakers and construction companies slows and product prices fall due to the global spread of Covid-19,” the South Korean company said.
Shares in Posco fell 0.6 per cent to Won170,500 on Friday morning in line with the benchmark Kospi Composite Index.
George Russell 4/24/2020, 3:34:48 AM
WHO reports fivefold increase in Covid-19 scam emails
The World Health Organization is facing a new plague: fraudulent emails from scammers attempting to capitalise on the coronavirus pandemic.
Since the start of the Covid-19 outbreak, the WHO said, it had seen a “dramatic increase in the number of cyber attacks directed at its staff, and email scams targeting the public at large”.
The number of cyber attacks is now more than five times the number directed at the organisation in the same period last year, the Geneva-based agency said on Thursday in a statement on its website.
This week, about 450 active WHO email addresses and passwords were leaked online. The health body said it was now migrating affected systems to a more secure authentication system.
The UN agency said scammers impersonated WHO staff to channel donations to fictitious funds instead of its own fund.
Emma Boyde 4/24/2020, 3:55:31 AM
Mexico braces for rapid jump in coronavirus infections
Jude Webber in Mexico City
The confirmed death toll from Covid-19 in Mexico has now breached the 1,000 mark, rising to 1,089 while the number of confirmed cases has climbed to 11,633.
Mexico is expecting the epidemic to peak by the second week of May.
Hugo López-Gatell, Mexico’s coronavirus tsar, acknowledged that the country should brace for a rapid rise in infections.
The head of Mexico’s national science and technology council said two prototypes of ventilators were advancing and the first models should be ready by mid-May.
President Andrés Manuel López Obrador’s increased austerity measures to help Mexico manage the economic fallout from the pandemic were published in the official gazette on Thursday, including pay cuts for senior officials.
Emma Boyde 4/24/2020, 4:26:55 AM
Virgin Australia owes more than $4bn to 12,000 creditors
Jamie Smyth in Sydney
About 12,000 creditors to Virgin Australia, including 26 banks and 50 aircraft lessors, are owed almost A$7bn ($4.5bn), according to initial estimates by the company’s administrator.
Deloitte on Friday said aircraft leasing companies, unsecured bondholders, banks and more than 9,000 employees are among the largest groups of creditors to the troubled airline.
Aircraft lessors are owed A$1.8bn, unsecured bondholders A$1.9bn and lenders A$2.2bn, mainly under secured corporate debt and aircraft financing facilities. Employees are owed A$450.7m, trade creditors A$166.7m and landlords A$71.2m, according to court documents submitted to the Federal Court.
Deloitte confirmed “more than 10 sophisticated parties, including international parties, have expressed an interest in buying the company”, as it begins a three-week process at gauging interest in buying the company.
Virgin’s board of directors appointed administrators this week following its failure to persuade the government to provide a A$1.4bn loan to rescue the company.
A first creditors’ meeting is due to be held by videolink next week. Deloitte has identified just over 10,000 creditors so far but expects the final number to be about 12,000.
George Russell 4/24/2020, 4:53:47 AM
Asian Development Bank approves $1.5bn loan to Philippines
John Reed in Bangkok
The Asian Development Bank on Friday approved a $1.5bn loan to help the Philippine government respond to the coronavirus pandemic.
The Japanese-backed, Manila-headquartered development bank said the loan would help Manila fund programmes including social protection measures, relief for small businesses, and health measures.
The loan was announced shortly after President Rodrigo Duterte declared a three-week extension of the lockdown that has been in place in greater Manila since mid-March and an extension of enhanced quarantine measures in place elsewhere on Luzon island and other parts of the country, even as lockdowns elsewhere were partially eased.
The Philippines has one of the highest Covid-19 caseloads in south-east Asia, and the Duterte government’s emergency spending measures announced so far include a 205bn peso ($4bn) subsidy programme meant to help 18m families that depend on informal-sector jobs.
The ADB earlier this month pledged to lend member countries $20bn to help them cope with the Covid-19 outbreak. On Thursday, the bank said it had approved a similar $1.5bn loan to Indonesia.
George Russell 4/24/2020, 5:00:28 AM
Delayed test results double Ecuador’s positive caseload
Gideon Long in Bogotá
The number of confirmed coronavirus cases in Ecuador has doubled to more than 22,000 after the health ministry received the results of thousands of tests that had been delayed as the country grapples with the pandemic.
In an online news conference, health minister Juan Carlos Zevallos said 10,977 new cases had been confirmed, on top of the 11,183 cases that were already known about.
The new total of 22,160 is the second-highest number in Latin America behind Brazil. Per capita, Ecuador is among the worst affected countries in the region. More than 500 people have died from the outbreak.
Guayaquil, a port city of more than 2m people, has been particularly badly hit and for a while local authorities were so overwhelmed that they were unable to collect the bodies. Some corpses were abandoned in the streets or stored inside houses for days in the tropical heat.
The pandemic comes as Ecuador is struggling to keep afloat economically. It has negotiated a four-month reprieve from debt repayments to bondholders and is talking to the IMF about reaching a new lending arrangement to replace the $4.2bn package it agreed last year.
Heavily dependent on oil exports, it has been hit hard by the fall in prices, and also suffered floods and landslides which knocked out two of its main oil pipelines.
Emma Boyde 4/24/2020, 6:08:53 AM
Pre-pandemic stockpiling boosts sales at Nestlé
Judith Evans in London
Nestlé posted higher-than-expected sales for the first quarter as the outbreak of coronavirus prompted consumers to stockpile coffee, pet food and ready-made meals.
The world’s largest food company reported organic sales growth — a key metric for the sector — of 4.3 per cent, up from 3.4 per cent a year earlier.
The maker of Nescafé, KitKat chocolate and Purina pet food said stockpiling had aided “significantly increased growth” in most of its markets. But the exception was China, where the outbreak began earlier and lockdown measures caused a “sharp sales decline”.
Mark Schneider, chief executive, said: “Our company remained resilient in the first quarter, reflecting our diversified product portfolio and our strong local presence in 187 countries. However, this crisis is far from over and we will face many uncertainties in the coming quarters.”
The company has set up a SFr500m ($512m) initiative to aid restaurants and other customers reliant on eating and drinking outside the home, which has been hard hit by lockdowns. It will extend payment terms, suspend rental fees for coffee machines and offer free products, Nestlé said.
Emma Boyde 4/24/2020, 6:22:14 AM
India to receive more test kits from China despite concerns over quality
Stephanie Findlay in New Delhi
India is set to receive more test kits from China even as authorities voiced concerns over their quality.
Anurag Srivastava, a Ministry of External Affairs spokesman, said in a statement late on Thursday that in the past two weeks India had received nearly “400 tonnes of medical supplies”, including test kits, personal protective equipment and thermometers.
“Around 20 more flights are expected to bring supplies from China in the coming days, and this is likely to be stepped up considerably in the next few months as our procurement efforts gain momentum,” said Mr Srivastava.
The announcement came in the same week that India announced it was suspending the use of rapid antibody kits, including some imported from China, over accuracy concerns.
New Delhi has moved to procure more kits from South Korea, announcing a partnership with diagnostic company SD Biosensor to produce antibody testing kits in India.
Adam Samson 4/24/2020, 6:25:59 AM
UK retail sales in historic drop as lockdowns hit industry
UK retail sales tumbled the most on record last month as the closure of non-essential stores overshadowed a historic surge in grocery purchases.
The volume of retail sales in the UK dropped 5.1 per cent in March compared with the previous month, according to data from the Office for National Statistics. This marked the largest drop since the ONS started producing the series in 1996 and reflects the closures of many stores from March 23 following government guidance during the pandemic.
“Retail sales saw their biggest monthly fall since records began over 30 years ago with large declines in clothing and fuel, only partially offset by strong food sales” said Rhian Murphy, ONS head of retail sales.
The volume of food sales rose 10.4 per cent in April compared with the previous month, the strongest on record.
In contrast, the volume of fuel sales, which is adjusted for price changes, fell 18.9 per cent over the same period. Sales of clothing tumbled 35 per cent. The size of the drop could not be offset even by many consumers switching to online purchases, which reached 22.3 per cent of all retailing last month, a historic peak.
Myles McCormick 4/24/2020, 6:55:11 AM
UK corporate roundup
Persimmon joined the list of UK housebuilders planning a return to construction work, announcing a “phased restart” from next Monday, April 27.
That comes after rivals Vistry Group, formerly known as Bovis Homes, and Taylor Wimpey, one of the sector’s biggest names, set out their plans to restart operations yesterday.
Trading website IG Group has continued to reap the rewards of “exceptionally high” levels of market volatility, which it said had led to “exceptionally high” trading volumes and, in turn, “exceptionally high” revenues from client fees.
It said estimated revenue in the first 61 days of its fourth quarter, which began in March, would be around £173m. That compares with £140m in the three months to the end of February, when trading had already been boosted.
Educational publisher Pearson reported a 5 per cent slide in revenue in the first quarter of its financial year as coronavirus forced it to close test centres and knocked demand for courseware. Its digital sales were boosted, however.
Fashion retailer Burberry said senior management and board members would be taking a 20 per cent pay cut from April to June and pushed publication of its full-year results back by a week to May 22.
It also said its trenchcoat factory in Castleford in the north of England was manufacturing non-surgical gowns for the NHS.
Myles McCormick 4/24/2020, 6:59:52 AM
Pearson revenues knocked by school and university closures
Mark Di Stefano in London
Pearson has seen revenues decline in the first three months of the year with the educational publisher blaming widespread school and university closures brought on by the coronavirus pandemic.
Revenues fell 5 per cent in the first quarter, driven by the company’s US-textbook business which was down 10 per cent.
But Pearson’s outgoing chief executive John Fallon said the company had been boosted by the shift into online learning and virtual schools.
“When the threat of the pandemic eventually eases, it will be even clearer that the future of learning is increasingly digital,” he said. “Through the crisis, we are continuing to invest in the platform, products and services that will make the next generation of digital learning a reality.”
The company also announced Mr Fallon and the chief financial officer were taking a pay cut of 25 and 20 per cent respectively, while none of Pearson’s more than 20,000 staff would be furloughed.
Harry Dempsey 4/24/2020, 7:09:11 AM
European stock markets open lower
European shares fell at the market open, after a potential antiviral drug to treat coronavirus disappointed in its first clinical trial.
The continent-wide Stoxx 600 dropped 1.4 per cent and the FTSE 100 in London was down 1.3 per cent on opening, after a volatile week in the oil markets.
Brent crude pared earlier gains to trade at $21.62 per barrel, up 1.4 per cent. The front month contract for WTI, the US oil marker, rose 1.9 per cent to trade at $16.82 a barrel, rebounding mildly from earlier losses this week.
Shares on Wall Street were close to flat overnight, as investors grappled with the news of a setback in developing a possible Covid-19 treatment. S&P futures suggested a 0.4 per cent drop when trading opens later on Friday, following a fall of 2.7 per cent over the past week.
Myles McCormick 4/24/2020, 7:15:03 AM
Italian bonds sell off after EU summit fails to agree on recovery fund
Tommy Stubbington in London
Italian bonds are under pressure again after European leaders failed to agree on the details of a “recovery fund” to help relaunch the region’s economies after the coronavirus crisis.
Italy’s 10-year yield was trading at 2.09 per cent early on Friday, close to its high for the week. The gap with German yields — an important measure of eurozone risk — was 0.15 percentage points wider at 2.56 percentage points. Spanish and Portuguese bonds also joined the sell off.
Analysts said Thursday’s brief videoconference summit between EU leaders provided little evidence that euro area countries were moving towards a crisis package which shared the financial burden between member states. Proposals for jointly-backed “coronabonds” have foundered on Dutch and German opposition, and Angela Merkel expressed her opposition to direct grants for badly-hit states following the summit
“There was little in yesterday’s EU Council outcome for optimists to hang their hats on,” said analysts at ING. “With the two options most akin to fiscal burden-sharing ruled out, the European Central Bank is left on its own to suppress financial fragmentation in the eurozone.”
Italian spreads are closing in on the 2.8 percentage point level reached prior to the launch of the ECB’s €750bn emergency bond-buying programme, with some investors saying the central bank would have to announce further purchases to keep borrowing costs under control in Italy.
Adam Samson 4/24/2020, 7:20:01 AM
Investors trapped as Franklin Templeton gates six Indian debt funds
Benjamin Parkin in New Delhi
Franklin Templeton’s Indian arm has gated six debt mutual funds, trapping more than $3bn of investors’ money as coronavirus sparks turmoil in Indian bond markets.
The asset manager announced that it was shutting the fixed income and credit funds in response to heightened outflows as the pandemic has badly affected India’s financial system, with the country in the midst of a near six-week lockdown. The move stands to affect retail and corporate investors that have poured into the schemes.
India’s debt markets were rocked by the collapse of a large shadow bank 18 months ago, and have struggled with liquidity since. The country’s central bank has taken various measures to boost liquidity since the lockdown was announced, but with limited success so far.
The company said “this is the only viable option to preserve value for unit-holders and to enable an orderly and equitable exit for all investors in these unprecedented circumstances”.
Adam Samson 4/24/2020, 7:24:12 AM
Eni earnings dealt large blow by tax bill and oil drop
Italy’s Eni reported a 94 per cent drop in first-quarter earnings, as a massive tax bill coincided with severe measures to curb the spread of the coronavirus outbreak, hurting oil demand and propelling a slide in crude prices in March.
Adjusted net profit fell to €59m in the three months to March 31, far below analyst expectations of €240m, with lockdowns and travel bans rolled out by governments across the world in the final month in the quarter.
Eni said it would cut spending by 30 per cent and it now expects lower production levels, at 1.75m-1.8m barrels of oil equivalent per day – down by at least 500,000 boe/d.
Chief executive Claudio Descalzi said:
The period since March has been the most complex period the global economy has seen for more than 70 years. For the energy industry, and in particular for oil and gas, the complexity is even greater given the overlap of the effects of the pandemic with the collapse in oil prices.
Eni had already announced a series of spending cuts, which it said it would deepen – amounting to a fall of €2.3bn. It has also cancelled a share buyback programme and issued debt.
Myles McCormick 4/24/2020, 7:26:25 AM
South Korea hands $2.3bn lifeline to country’s major airlines
Song Jung-a in Seoul
South Korea’s state-run policy banks will provide the country’s two biggest airlines with a Won2.9tn ($2.3bn) lifeline as carriers struggle to stay afloat amid a global industry crisis sparked by the coronavirus pandemic.
Korea Development Bank and Export Import Bank of Korea will provide Won1.1tn to Korean Air, the country’s flag carrier, and Won1.7tn to its smaller rival Asiana Airlines to help tide them over the liquidity crisis.
The emergency lifeline will be provided to the troubled airlines before the government provides Won40tn of financial support to the country’s worst-hit industries including carmakers, telecoms, airlines and shipbuilders. The relief funding for the country’s main industries was announced earlier this week.
The financial support for the airlines will be provided on condition that the companies advance restructuring, retain jobs, and refrain from increasing salaries for executives or buying back their own shares.
South Korea’s travel sector was one of the earliest to be hit by the pandemic after a big outbreak in February promoted more than 100 countries to introduce travel bans or tougher entry restrictions on people travelling from the Asian country.
Myles McCormick 4/24/2020, 7:29:19 AM
Sanofi boosted by drug stockpiling
Leila Abboud in Paris
Sanofi confirmed its annual profit growth goal after first-quarter sales and profit were buoyed by people stockpiling its drugs during the Covid-19 outbreak.
The French pharmaceutical manufacturer said it expected that the boost would be “largely offset” in the second quarter though.
Revenue rose 6.6 per cent on like-for-like basis to €8.97bn in the quarter to March 30 driven by higher sales of over-the-counter medicines for pain and fever, as well as of eczema drug Dupixent. Net income rose 16.1 per cent to €2bn with about half the increase attributable to Covid-19, the company said on Friday.
Sanofi is one of the companies racing to produce a vaccine for coronavirus that has killed roughly 190,000 this year. It has two in development, and has teamed up with GlaxoSmithKline on one of them.
Sanofi is also testing the efficacy of two of its drugs already approved for other uses against Covid-19, including the malaria drug hydroxychloroquine and Kevzara, which is usually used to treat rheumatoid arthritis.
Myles McCormick 4/24/2020, 7:34:31 AM
German infections top 150,000
Tobias Buck in Berlin
Germany reported 2,337 new coronavirus cases on Friday, an increase of 2 per cent compared with the previous day that took the total number of detected infections to 150,383 since the crisis started.
According to official data from the Robert Koch Institute in Berlin, the number of Covid-19 deaths recorded over the past 24 hours rose by 227, or 4 per cent, to 5,321.
The increase in new cases is broadly in line with previous days, but notably lower compared with Friday last week, when the Koch Institute recorded 3,380 new cases.
Germany allowed small and medium-sized shops to reopen and some students to return to school this week. The move reflects recent data showing that the spread of the virus has slowed markedly, but was still criticised by some virologists as premature.
Myles McCormick 4/24/2020, 7:46:42 AM
Boris Johnson hoping to return to work next week
Jim Pickard in London
Boris Johnson could be back at work as soon as Monday – two weeks earlier than expected – according to government officials as the prime minister makes a rapid recovery from coronavirus.
Mr Johnson is hoping to return to his office early next week, Downing Street figures said, although they emphasised that no decision had been finalised. The news was first reported in the Daily Telegraph, which quoted one official saying the prime minister had already been working “pretty much full time” this week.
Overnight, Donald Trump, the US president, said that Mr Johnson had sounded ready to return to work when the duo spoke on the phone earlier in the week. “I will tell you, he sounded incredible, he was ready to go,” he said. “It’s like the old Boris, tremendous energy, tremendous drive.”
Mr Johnson will return to a growing row within his Conservative party over whether the government should accelerate plans to end the current coronavirus lockdown.
Philip Georgiadis 4/24/2020, 7:50:23 AM
Russia reports record number of daily deaths
Henry Foy in Moscow
Russia reported close to 6,000 new cases of coronavirus on Friday, and a new daily record of 60 deaths.
Friday’s 5,849 cases breaks a two-day streak of shrinking daily increases, and takes Russia’s total number of infections to 68,622. More than 600 people have died from Covid-19 in the country.
Moscow’s mayor on Thursday said he expected the outbreak to peak only in a few weeks.
Underlying the scale of the outbreak, Russia has recorded infections in 82 of the vast country’s 85 regions.
Myles McCormick 4/24/2020, 8:01:05 AM
Global death toll passes 175,000 as fatalities steady
Steve Bernard in London
The worldwide death toll rose by 6,618 on Thursday to stand at 176,492. The daily increase is holding at 4 per cent, a much lower rate of growth than the peak of 15 per cent in late March, according to data from Worldometers.
New cases of Covid-19 rose by 85,534 on Thursday, bringing the total to 2.66m. This is the fourth consecutive day that daily cases have been greater than the day before.
The daily death toll in the US dropped below 2,000 on Thursday. 1,911 people lost their lives according to data from The Covid Tracking Project, pushing the current death toll to 44,014.
New York, the hardest-hit state, added 438 deaths yesterday, the lowest daily increase since April 2, bringing the total to 15,740.
The UK remains the worst-affected country by deaths outside the US, adding a further 638 fatalities to a total which now stands at 18,738. The number of newly confirmed cases rose by 4,583, the 16th consecutive day with more than 4,000 cases diagnosed.
The number of global recovered cases rose by 27,969 yesterday, leaving a total of 745,413 free from the virus.
Philip Georgiadis 4/24/2020, 8:20:46 AM
Trump faces backlash for raising ‘disinfectant’ injection idea
Clive Cookson, Science Editor
US president Donald Trump has sparked outrage among the medical community by raising the idea that injecting disinfectant or irradiating the body with ultraviolet light might treat coronavirus.
Mr Trump picked up on research mentioned by White House officials showing that sunlight and disinfectant kill the virus outside the body, and floated the idea that similar measures might work inside patients.
“I see the disinfectant where it knocks it out in a minute,” Mr Trump said.
One minute! And is there a way we can do something by an injection inside or almost a cleaning? Because you see it gets in the lungs . . . so it’d be interesting to check that.”
In fact, disinfectants can be poisonous when swallowed. External exposure can burn the skin, eyes and lungs.
Doctors quickly responding by condemning the comments. Dr Vin Gupta, a lung specialist, told NBC News:
This notion of injecting or ingesting any type of cleansing product into the body is irresponsible and it’s dangerous. It’s a common method that people utilise when they want to kill themselves.”
German business confidence crushed by coronavirus lockdown
Martin Arnold in Frankfurt
German businesses are confronting their worst ever fall in activity, orders and confidence as the heavy toll of the lockdown to contain the coronavirus pandemic was revealed by a new survey on Friday.
The Ifo Institute in Munich said its monthly survey of 9,000 German companies found that sentiment had “crashed” from 85.9 in March to a record low of 74.3 in April.
“Never before has the index fallen so drastically,” the Ifo said. “This is primarily due to the massive deterioration in the current situation. Companies have never been so pessimistic about the coming months. The coronavirus is striking the German economy with full fury.”
The survey found that businesses’ assessment of both their current situation and their expectations for the next six months had deteriorated dramatically in all sectors. The hardest hit sectors were manufacturing, where Ifo said demand for industrial products had “collapsed”, and trade, where confidence had “continued to nosedive”.
The outlook of companies in the services sector also fell to a record low. While in the construction sector it said “the index has never sunk so abruptly” but most companies were “still satisfied with their current situation”.
Philip Georgiadis 4/24/2020, 8:44:35 AM
Co-op faces £200m hit from pandemic
Andy Bounds in Manchester
The Co-operative Group said the coronavirus outbreak will cost it £200m, which will only be partially recouped by increased food sales and government support.
The UK’s sixth largest grocer by market share continued its strong sales performance but warned of challenges ahead. It also had to knock £10m off 2018’s pre-tax profits after discovering historical accounting errors within Nisa, the wholesaler it bought in May 2018.
Total revenues grew 7 per cent to £10.9bn, Group underlying profit before tax, excluding the impact of lease accounting changes, was up 50 per cent from £33m to £50m.
Steve Murrells, chief executive said:
No part of our business has been unaffected by the outbreak of the virus and we have played a critical role in communities throughout the UK.
Harry Dempsey 4/24/2020, 8:46:57 AM
How Richard Branson changed his mind over government aid
Tanya Powley in London and Jamie Smyth in Sydney
At the height of the financial crisis in 2009, billionaire Richard Branson balked at the idea of government intervention to stop companies going bust, proclaiming that weak airlines should be allowed to go to the wall.
Just over 10 years later and the Virgin Group founder has had a change of heart as he fights to protect his business empire from the fallout of the coronavirus crisis.
French lockdown averted 62,000 hospital deaths, study says
Victor Mallet in Paris
The first month of the French lockdown on its population to slow the spread of coronavirus saved nearly 62,000 lives that would have been lost to the pandemic in hospitals alone, according to a research paper.
“Our analysis shows that in absence of any control measures, the Covid-19 epidemic would have had a critical morbidity and mortality burden in France, overwhelming in a matter of weeks French hospital capacities,” the researchers said in the study released by the School of Higher Studies in Public Health (EHESP).
Since March 1, France has officially reported 21,340 Covid-19 deaths, 13,236 in hospitals and the rest in old people’s homes and other care institutions.
Without any control measures, 14.8m people or 23 per cent of the population would have been affected by Covid-19, the study said. Another research paper has calculated that only about 6 per cent of the population will have been infected by the time the lockdown ends on May 11.
The lockdown therefore prevented 587,730 hospitalisations and 140,320 admissions to intensive care, the EHESP paper said. The total number of ICU beds required to treat patients in critical conditions would have been 104,550, much higher than the 5,000 such beds available before the crisis or the 10,000 available now.
Myles McCormick 4/24/2020, 9:31:15 AM
Dettol maker warns against injecting disinfectant after Trump comments
Reckitt Benckiser — the company behind cleaning brands including Lysol and Dettol — has warned that “under no circumstance” should disinfectants be used to treat coronavirus patients.
The statement from the UK consumer goods group comes after US President Donald Trump caused uproar among medics by suggesting that injections of disinfectant could provide a potential coronavirus treatment.
Mr Trump speculated in a press briefing yesterday that it would be “interesting to check” if use of disinfectants could play a role in combating the virus “by an injection inside”.
Reckitt said it had since been asked whether internally administering disinfectants “may be appropriate for investigation or use as a treatment” for the virus. Its answer was abundantly clear:
As a global leader in health and hygiene products, we must be clear that under no circumstance should our disinfectant products be administered into the human body (through injection, ingestion or any other route).
Philip Georgiadis 4/24/2020, 10:11:01 AM
London’s transport network to furlough 7,000 staff
Bethan Staton in London
Transport for London will furlough 7,000 staff as a result of the coronavirus pandemic as it works to cut costs following a massive reduction in passenger numbers, the London operator announced today.
The network said furloughing the workers, which account for around 25 per cent of its total workforce, would save an estimated £15.8m every four weeks. Under its job retention scheme the UK government will pay 80 per cent of furloughed staff’s salaries, with TfL paying the additional 20 per cent.
Government advice to stay at home and reserve public transport for essential workers has meant tube journeys in London have fallen by 95 per cent and bus journeys by 85 per cent, the operator said.
TfL is one of several UK regional rail networks seeking a bailout from the government to ensure the continuation of business and skeleton transport services for essential staff. Transport Commissioner Mike Brown described discussions with the government as “constructive”.
Harry Dempsey 4/24/2020, 10:17:32 AM
UK regional transport networks receive government funding
Jim Pickard in London and Arthur Beesley in Dublin
Five light rail systems in the Midlands and northern England are set to receive tens of millions of pounds in support as they struggle to stay afloat during the coronavirus epidemic.
The Department for Transport refused to say precisely how much money it would give to the five light rail schemes in Greater Manchester, Sheffield, Nottingham, West Midlands and Tyne and Wear. But it said the money would soon be forthcoming through deals with the relevant local authorities.
The government also agreed £17m of state support to ferry companies to maintain “roll on, roll off” services on five routes between Great Britain and Northern Ireland – with 40 per cent of the cost coming from the Belfast administration. Another £10.5m will be provided to keep “lifeline” services going to the Isles of Scilly and Isle of Wight for three months.
Brandon Lewis, secretary of state for Northern Ireland in the UK government, said London and the regional executive were also working on an aid plan for airlines. “A further support package is also being developed to help ensure crucial air passenger services to and from London, Belfast City Airport and City of Derry Airport are maintained.”
The latest interventions by the DfT follows a package of support for train companies – who have seen rail lines effectively nationalised for six months – as well as money for struggling bus companies.
The department has so far failed to reach an agreement with Transport for London, which has begged central government for financial assistance after plunging traveller numbers on the Tube and buses.
Myles McCormick 4/24/2020, 10:18:26 AM
Suspension of English cricket season extended to July
Samuel Agini in London
The suspension of the cricket season in England and Wales has been extended, meaning the schedule for domestic and international matches faces further upheaval.
The England and Wales Cricket Board said on Friday that no professional cricket can be played until at least July 1, an extension of the previous delay, which had been due to run until at least May 28.
The ECB said the Vitality Blast, a short form competition, will take place as late into the season as possible, while all other matches that had been due to be held in June will be moved. International cricket matches will be pushed from July to the end of September.
However, there was no decision on whether to postpone the Hundred, a new 100-ball cricket tournament that had been set for its inaugural season in July. The ECB said it has scheduled a board meeting next Wednesday to discuss the tournament.
Tom Harrison, ECB chief executive, said:
As much as we remain hopeful that we can deliver some cricket this summer, we are in the midst of a worldwide crisis and our priority – over and above the playing of professional sport – will be to protect the vulnerable, key workers and society as a whole.
Philip Georgiadis 4/24/2020, 10:22:16 AM
Germany braced for 1m people to lose their jobs
Martin Arnold in Frankfurt
German unemployment is expected to rise by more than 40 per cent as about 1m people lose their jobs in the coming months because of the coronavirus crisis, according to new research published on Friday.
The Institute for Employment Research said the surge in unemployment numbers was expected to be partially offset as the economy recovers later in the year, though it predicted Germany would still end the year with 520,000 more jobless people.
Forecasting an 8.4 per cent contraction in Germany’s economy this year, which would be the worst recession in the country’s postwar history, the report warned: “The sudden and serious slump in economic output puts massive pressure on the job market.”
It predicted that about 1m people would lose their jobs in the coming months, including several hundred thousand people doing so-called mini-jobs, the lightly regulated part-time posts that can earn up to €450 a month while not paying any taxes or social security. The Institute, which is an arm of the Federal Employment Agency, said the government’s short-term leave scheme, known as Kurzarbeit, would provide significant support to the labour market.
Myles McCormick 4/24/2020, 10:35:51 AM
Exclusive: US banks pull back from lending to European companies
Olaf Storbeck in Frankfurt, Stephen Morris in London and Laura Noonan in New York
US banks are pulling back from lending to European companies during the coronavirus pandemic, fuelling concerns that Wall Street may be quietly withdrawing to its home market in a repeat of the last financial crisis.
Bankers, advisers and company executives said American lenders had become more cautious in underwriting bilateral and syndicated loans to large corporate clients across the region in recent weeks.
In Germany, JPMorgan recently pulled out of talks over an additional credit line for BASF, the world’s largest chemicals group, according to people involved in the transaction. Similarly, Bank of America lent half as much as the other six international banks that underwrote a €3bn state-backed loan to sportswear giant Adidas.
Goldman Sachs — which helped underwrite a €3.5bn syndicated loan for Italian-American carmaker Fiat Chrysler this month — did not take part in a similar €12bn facility for German rival and long-standing client Daimler, leaving other lenders to make up the difference.
“We are increasingly observing an ‘America first’ attitude among large US banks,” said an adviser directly involved in negotiations between banks and corporates in Germany. “Those are not just idiosyncratic cases: there is a clear pattern.”
Russian central bank slashes interest rate to curb economic damage
Henry Foy in Moscow
Russia’s central bank cut its benchmark lending rate by 50 basis points on Friday to its lowest level in six years, in a bid to limit the economic pain from the coronavirus pandemic.
The Covid-19 outbreak, which has sparked a global economic crisis and seen oil prices fall by around 60 per cent has placed the bank in a bind, caught between wanting to limit the scale of Russia’s economic contraction and temper pressure on both inflation and the rouble.
The scale of the cut, which reduces the key interest rate to 5.5 per cent, was deeper than usual, but widely expected following comments from the bank’s governor earlier this month.
“The situation has changed dramatically since the meeting of the board of directors in March,” the bank said in a statement accompanying the decision. “With the development of the situation in accordance with the basic forecast, the Bank of Russia admits the possibility of further reduction of the key rate at the next meetings.”
The rouble has fallen 20 per cent since the start of the year. A weaker currency typically fuels rising inflation in Russia by pushing up the cost of imported goods.
“We believe a cut is premature, given growing inflationary pressure,” said Luis Saenz, head of equities at BCS Global Markets. “The economic effect of such a move would likely be negligible.”
Anna Gross 4/24/2020, 10:57:58 AM
Mitsubishi cancels dividend and docks executive pay to mitigate losses
By Kana Inagaki in Tokyo
Mitsubishi Motors will cancel its year-end dividend and cut its executive pay after warning it faces an annual loss of $240m caused by the coronavirus downturn in car sales.
In a statement late on Friday, the Japanese carmaker, which has an alliance with Nissan and France’s Renault, said the sharp decline in vehicle demand “greatly exceeded” its expectations as the pandemic also forced an industry-wide shutdown of factories worldwide.
For the fiscal year that ended in March, Mitsubishi said it now expects a net loss of ¥26bn ($241m) compared with an earlier forecast for a profit of ¥5bn. Even before the outbreak, the company was already lossmaking as sales fell in Indonesia, China and Australia.
Mitsubishi said it would cut its base executive pay by up to 30 per cent for the new 2020-21 fiscal year.
Its alliance partner Renault is also close to securing a multibillion-euro credit line from the French state as it burns through cash at a rate of €600m a month to combat collapsing sales.
Anna Gross 4/24/2020, 11:04:45 AM
China’s top envoy shrugs off misinformation allegations
Michael Peel in Brussels
China’s top envoy to the EU has hit back at allegations that Beijing is spreading disinformation over the coronavirus crisis, as tensions rose over a Brussels internal report that accused Chinese official sources of a push to deflect blame for the pandemic.
Zhang Ming said it was better to “forget the politics for now” to focus on the fight against Covid-19, in a riposte to claims from some European officials that Beijing is trying to exploit the health emergency for strategic gain.
“Disinformation is an enemy for all of us and it should be addressed by all of us,” Mr Zhang said in an online event on Friday organised by the Friends of Europe think-tank. “From the very beginning, China has suffered a lot from disinformation.”
His remarks came after an internal report prepared by the EU’s diplomatic service this week accused Beijing of using “both overt and covert tactics” in a “global disinformation campaign”.
The report – contents of which have been leaked and which is expected to be published soon in edited form – has angered China, European officials said.
Harry Dempsey 4/24/2020, 11:05:06 AM
Spain’s Covid-19 deaths drop to lowest level in a month
Daniel Dombey in Madrid
Spain’s coronavirus death toll has fallen to its lowest level in more than a month, according to government figures released on Friday, as the country ends the sixth week of one of the world’s toughest lockdowns.
The ministry of health said that in the 24 hours until 9pm on Thursday, 367 people had died after contracting the virus. This is the lowest death toll since 324 people died on March 21 and is well below the peak of 950 deaths on April 2. For most of this week, the death toll has been above 400 a day; throughout the previous week it was above 500 a day.
The official death toll now stands at 22,524 although the true figure is almost certainly significantly higher, since only people who tested positive are included, while those who displayed symptoms but were never tested are not.
The Spanish government is changing its methodology for counting the numbers of confirmed coronavirus cases, as it rolls out relatively speedy antibody tests. It said that a cumulative total of 219,764 people had been found to carry the virus, either because of the antibody tests or more accurate PCR tests.
The number of people who tested positive under the PCR test rose 1.4 per cent on the previous day to 202,990. The 2,796 people who had positive PCR results in the last 24 hour period were fewer than the 3,105 people who were confirmed to have recovered in the same period – the first time this milestone has been passed.
Anna Gross 4/24/2020, 11:17:47 AM
UK government apologises after closing virus test booking site
Laura Hughes in London
The UK government has apologised after it was forced to close a new online booking site for coronavirus tests within hours of its launch following a flood of applications for appointments and home testing kits.
Matt Hancock, health secretary, announced on Thursday that ministers were expanding coronavirus testing to 10m workers and their families as they race to hit a target of 100,000 tests a day by the end of April.
Around 1,000 home testing kits and an unspecified number of appointments at centres were made available on the gov.uk website on Friday morning amid reports of frontline workers driving for hours to testing stations.
But applications for self-referral closed within hours of the site’s launch. It states: “Coronavirus test: applications closed. You can’t currently register for a Covid-19 test. Please check back here later.”
In a statement on Twitter, the health department said: “There has been significant demand for booking tests today. We apologise for any inconvenience. We are continuing to rapidly increase availability. More tests will be available tomorrow.”
The government has said it hopes to increase the number of home tests to 18,000 a day by the end of April.
Peter Wells 4/24/2020, 11:24:43 AM
American Express profit sinks on increase in credit provisions amid pandemic
Robert Armstrong in New York
Net income at American Express fell by 76 per cent in the first quarter, driven down by a $1.8bn increase in credit provisions and lower customer spending at the end of the quarter.
“The deterioration in the economy due to Covid-19 impacts that began in the first quarter and accelerated in April has dramatically impacted our volumes,” chief executive Stephen Squeri said.
Revenues, adjusting for the impact of currency, were up 1 per cent from the year-ago period, at $10.3bn, and earnings were 41 cents a share. The company said were it not for the increase in provisions, EPS would have been $1.98. Wall Street analysts had been expecting revenues of $10.6bn and EPS of $1.88.
Provisions for credit losses, at $2.6bn, more than tripled. Unlike Mastercard and Visa, which act as pure payment networks and card-issuing banks, American Express holds its customers loan balances on its own balance sheet.
“In light of the current environment, we are aggressively reducing costs across the enterprise, while at the same time selectively investing in initiatives that are key to our long-term growth strategy,” Mr Squeri said, adding that the company had committed to no Covid-19 related lay-offs for the rest of this year.
Total expenses fell 5 per cent, to $7.2bn, from the year before.
American Express shares have fallen almost 40 per cent since the virus first hit markets in late February. The shares rose by 2 per cent in early trading on Friday.
Anna Gross 4/24/2020, 11:48:39 AM
Michel Barnier demands ‘serious engagement’ from UK in negotiations
Mehreen Khan in Brussels
Michel Barnier, the EU’s chief Brexit negotiator, has hit out at the UK for failing to “seriously engage on a series of fundamental points” over its negotiations with only eight months left before the country’s exit.
Speaking after a week of online negotiations by videoconference with his counterpart David Frost, Mr Barnier said he was “worried” by the UK’s failure to take seriously a number of key subjects that need to be agreed to secure the EU-UK future relationship.
Speaking at a press conference in Brussels, Mr Barnier laid out four areas where negotiators failed to make “tangible” progress including level playing field issues such as social standards, the governance of the future relationship, and the UK’s resistance to accepting judgments from the EU’s highest court.
“This week the UK failed to engage substantially on these topics. It argued that our positions are too far apart to reach an agreement”, said Mr Barnier, referring to the issue of the level playing field. Mr Barnier also said there had been “no progress” on the sensitive issues of fisheries.
The UK cannot refuse to extend the transition and at the same time slow down the progress of the negotiations.
The British government has repeated that it will not ask for an extension to the talks beyond the end of this year despite the disruption caused by the coronavirus. “More than ever, the clock is ticking,” said Mr Barnier.
Philip Georgiadis 4/24/2020, 12:01:00 PM
Bank of America sees opportunities in ‘humiliated’ energy assets
Bank of America has advised clients that now is a good time to buy ‘humiliated’ oil assets, following a crash in the price of crude that has rippled across the energy sector.
“If distressed assets can’t attract a bid now, time to pack up the toys,” the bank’s investment strategists wrote in a note to clients late on Thursday.
The oil market has come under significant pressure during the coronavirus pandemic, as fears over dwindling demand and a lack of storage space combined to drive US crude prices negative for the first time in history this week.
The Wall Street bank also said that a sharp rally in risk assets could have further to run, with a $4.7tn cash mountain still sitting on the sidelines waiting to be deployed.
Philip Georgiadis 4/24/2020, 12:13:07 PM
Freeport-McMoran slumps to first-quarter loss
Henry Sanderson in London
Copper miner Freeport-McMoran swung to a net loss of $491m in the first quarter due to lower copper prices and disruptions to its operations from coronavirus.
The Arizona-based miner said it would cut capital spending by $800m this year and reduce copper sales in the Americas by 15 per cent.
Copper prices have fallen by 17 per cent this year following the outbreak of coronavirus, causing miners to cut capital spending and curtail operations.
This month, Freeport suspended operations at its Chino copper mine in New Mexico after some employees contracted coronavirus. Its Cerro Verde copper mine in Peru has also been operating at reduced rates after the country declared a national emergency in March.
Anna Gross 4/24/2020, 12:35:34 PM
UK government apologises for closing test booking site hours after launch
Laura Hughes in London
The UK government has apologised after it was forced to close a new online booking site for coronavirus tests within hours of its launch following a flood of applications for appointments and home testing kits.
Matt Hancock, health secretary, announced on Thursday that ministers were expanding coronavirus testing to 10m workers and their families as they raced to hit a target of 100,000 tests a day by the end of April.
Downing Street said 5,000 key workers had applied for home testing kits within two minutes of the page on the gov.uk site launching on Friday morning, following reports of frontline workers driving for hours to testing stations.
Meanwhile, 15,000 bookings for Friday appointments at drive-through testing centres were also made.
Peter Wells 4/24/2020, 12:51:54 PM
US durable goods orders fall the most since 2014
US purchases of long-lasting goods fell in March by the most in more than five years, but underlying measures of business investment suggested some degree of resilience in the economy.
The headline index tracking purchases of durable goods plunged 14.4 per cent last month – due to a huge drop in commercial aircraft orders – down from a 1.1 per cent rise in February. It was the biggest monthly decline since August 2014, and steeper than the 11.9 per cent drop forecast by economists.
More encouraging, though, were mild drops in measures of underlying spending, which strip out big-ticket items like aircraft and defence.
The index tracking durables excluding transport eased 0.2 per cent in March, an improvement from February’s 0.7 per cent drop, and better than the 5.8 per cent contraction forecast by Wall Street.
New orders for non-defence capital goods excluding aircraft, commonly regarded as a proxy for business investment, slid 0.1 per cent, bouncing back from a revised 0.8 per cent decline the previous month, and well ahead of the 6 per cent contraction pencilled in by economists.
“Before we get too excited, it’s important to remember that the lockdowns only really began in earnest in the second half of last month. Furthermore, this recession will be unusually concentrated in the services sector and consumption, whereas manufacturing and business investment will be relatively less affected, at least initially,” Paul Ashworth at Capital Economics said.
Philip Georgiadis 4/24/2020, 1:17:25 PM
UK’s testing faces logistical hurdles
Restrictive criteria and hard-to-reach screening sites are contributing to a growing gulf between the UK‘s Covid-19 testing capacity and the number of people being tested for the virus.
The FT’s Robert Wright has visited a testing site in London.
At one of the longest-established drive-through testing sites, by the O2 Arena in Greenwich, south-east London, the extra demand was manifesting itself on Friday in far longer wait times to access testing than earlier in the week. At lunchtime, there was a queue of around a dozen cars waiting to enter the testing site in a car park by the arena, the former Millennium Dome, and staff were forced to reorganise the queue to stop its congesting other roads in the area.
Once inside the site, the cars’ occupants went to one of three white, drive-through tents to be given a testing kit and instructions on how to administer the test before driving off to a parking space to use the kit. Cars were spending around half an hour inside the site.
It was clear, however, that the wider problems that have dogged the testing system were affecting many of those arriving for tests. One worker booking people in could be heard repeatedly telling those seeking testing that the system of QR codes meant to smooth the check-in process was not working. She was instead asking each for a mobile telephone number, details on where he or she worked, a worker identity card and an email confirming the appointment.
There were also signs of continued confusion about appointments. Several arriving workers were told their names were not on the list for testing and were struggling to prove that they in fact had an appointment to undergo a test.
Philip Georgiadis 4/24/2020, 1:35:07 PM
WHO launches push for global access to treatment and vaccine
Camilla Hodgson in London
The World Health Organization has launched a global initiative to accelerate the development and distribution of medicines and vaccines for Covid-19 to ensure “no-one is left behind.”
Speaking alongside French President Emmanuel Macron, British foreign secretary Dominic Raab and a host of other speakers from the public and private sectors, Tedros Adhanom, director general of the WHO, unveiled a “landmark” global collaboration to accelerate the development of and equitable access to coronavirus diagnostics, treatments and vaccines.
The WHO said it was critical that countries work together to ensure “no one is left behind … This is not about singular decision-making authority, but rather collective problem-solving, interconnectedness and inclusivity.”
Dr Tedros said that past experience had shown that “when tools are available they have not been equally available to all. We cannot allow that to happen.”
To raise funds to support the effort, the EU said it would organise a “worldwide pledging marathon” to raise a target €7.5bn of initial funding.
Anna Gross 4/24/2020, 1:59:15 PM
Global trade in February contracted most since financial crisis
Valentina Romei in London
Global trade in February contracted at a pace not seen since the financial crisis as the coronavirus pandemic hit Asia ahead of the lockdown in western countries, data has revealed.
The volume of global trade dropped by 2.6 per cent in February compared with the same month last year, the sharpest contraction since the financial crisis, while it contracted 1.5 per cent over the previous month, according to the Netherlands Bureau for Economic Policy Analysis.
Imports from Japan contracted by nearly 9 per cent in February compared with the previous month, marking the largest contraction of any large economy. After recording a 7.3 per cent fall in January, China’s imports dropped a further 3.2 per cent in February.
Western countries were affected, but not to the same extent. The US reported no change in trade volumes in February compared with the previous month, while eurozone trade fell by 1.5 per cent, driven by falling exports.
Myles McCormick 4/24/2020, 2:01:38 PM
French court upholds ruling restricting Amazon shipments
Leila Abboud in Paris
Amazon has lost its appeal in a French court case brought by unions who argued that the e-commerce giant was not doing enough to protect workers at its six warehouses in the country.
The company chose to close its warehouses in France last Thursday as it waited for the appeal of an earlier decision ordering it to do a systemic assessment of worker safety at its warehouses. That ruling required Amazon to limit shipments to only “essential items” such as food or health products or face fines of up to €1m per day. Amazon said complying would be onerous since it did not know which specific products would be allowed.
The Court of Appeal in Versailles on Friday confirmed the lower court’s decision and laid out in more detail the types of goods that Amazon could dispatch. It listed them as information technology products, healthcare, beauty and self-care products, food and petcare items. For every order not meeting this requirement, Amazon would face a fine of €100,000 penalty.
Amazon said it was studying the decision to determine the consequences on its operations in France. It did not say when the warehouses would re-open. Unions welcomed the decision, and said they hoped negotiations with the company would soon begin.
While the French warehouses have been closed, Amazon has still been taking and delivering orders in the country via third-party sellers and warehouses in other countries. But French consumers face having fewer products available to them and being subject to longer delays.
Peter Wells 4/24/2020, 2:05:59 PM
Verizon sees mixed impact from shift to remote working
Verizon experienced a pick-up in demand for its business services during the first quarter as thousands of consumers shifted to working from home, but not enough of a boost to offset the loss of more than half a million retail customers and the closure of physical stores.
Total revenues at the US’s second-biggest telecommunications company fell 1.6 per cent from a year ago to $31.6bn in the three months ended March 31.
Much of that came courtesy of a 1.7 per cent drop in revenue from the consumer division, which represents about 69 per cent of group sales. The company said it saw 525,000 postpaid mobile customers leave in the quarter, but had 59,000 net additions for its Fios Internet services “as work-from-home, in-home schooling, and other related measures increased the demand for high-quality broadband offerings”.
Revenues at Verizon’s business unit held up slightly better with a 0.5 per cent year-on-year drop to $7.7bn, with the company pointing to “heightened demand” for its products and services like VPNs, “jetpacks” and high-speed circuit capacity, as well as “experienced increased activity to support front line crisis responders, new work-from-home and home schooling arrangements, and other demands for critical connectivity services”.
Net income fell about 17 per cent from last year to $4.29bn, or $1 per diluted share compared with $1.22 last year.
Shares were down 0.6 per cent in early trade on Friday.
Anna Gross 4/24/2020, 2:06:15 PM
Bolsonaro locks horns with Brazilian political power broker
Bryan Harris and Andres Schipani in São Paulo
The feud between Brazil’s two most powerful political power brokers that played out mostly behind the scenes for months has now spilled into the open, as president Jair Bolsonaro and Rodrigo Maia, the speaker of Congress’s lower house, scramble for dominance.
At a rally outside a military base this weekend, Mr Bolsonaro joined protesters calling for Mr Maia to be ousted over the speaker’s support for social isolation measures to curb the spread of coronavirus, which the president has publicly flouted. Carla Zambelli, a pro-Bolsonaro lawmaker, said they were calling for the “investigation and arrest” of Mr Maia.
Many in the crowd bore placards calling for the restoration of military rule in scenes that drew condemnation from lawmakers, judges and even the Brazilian military. A day later, the Brazilian president declared “I am the constitution”, as he urged an end to lockdowns.
Investors baffled by soaring stocks in ‘monster’ depression
Robin Wigglesworth in Oslo
The divergence between the flying stock market and the dying economy is so extreme it is leaving many analysts scrambling for explanations.
The recent string of economic data releases reflecting life under global coronavirus lockdowns has been even grimmer than expected, spurring the IMF this week to forecast the biggest global recession since the 1930s’ Great Depression.
Some investors are in awe at the scale of the shock. “We really are in uncharted territory,” said Liz Ann Sonders, chief investment strategist at Charles Schwab. “We have a monster mash-up of the Great Depression in size, the crash of 1987 in speed, and 9-11 attack in terms of fear.”
And yet, stock markets have been on a tear for a month. What was once dismissed as a mere “bear market rally” — often strong but ultimately doomed bounces that can occur in the middle of severe downturns — has now turned into a 23 per cent jump for global stocks. Technically, that qualifies as a new bull market.
The number of people to have died from coronavirus in UK hospitals has risen by 684 over the latest 24-hour reporting period, breaking a two-day decline in fatalities, according to the Department of Health.
The total number of those hospitalised to have died of coronavirus rose to 19,506, as of 5pm on April 23, up from 18,732 the previous day.
This increase in overnight deaths was up from 638 yesterday.
As of 9am on April 24, 612,031 tests have been conducted for coroanvirus, 28,532 of which took place on Thursday. Though the number of tests conducted each day has been on the rise, it is still far from the government’s 100,000 per day target by the end of the month.
Public health experts have warned that the daily fluctuations should be treated with caution, with the trend over a number of days more likely to offer an accurate snapshot of the state of the pandemic in the country.
Myles McCormick 4/24/2020, 2:36:28 PM
Lufthansa to cut 10,000 jobs
Joe Miller in Frankfurt
Lufthansa has said that it will shed 10,000 staff as it becomes a permanently smaller airline due to the Covid-19 pandemic.
In a webcast to employees on Friday afternoon, chief executive Carsten Spohr said the German group, which warned on Thursday that it was weeks away from running out of cash, was unlikely to stabilise until 2023.
“We expect yields to be ten percent lower and the load factor on our aircraft to be ten percent lower,” he said. “After the crisis, we will have to spend over a billion euros a year to repay loans.”
The Frankfurt-based airline, which is seeking state-aid in Germany, Austria, Belgium and Switzerland, also said it would axe 100 aircraft from its fleet of over 700.
Anna Gross 4/24/2020, 2:45:05 PM
Fitch downgrades Sri Lanka’s credit rating
Benjamin Parkin in New Delhi
Fitch has downgraded Sri Lanka’s credit rating to B- from B, citing fears over the sustainability of government debt ahead of a number of scheduled repayments.
While the country’s coronavirus infection count remains below 500, the South Asian economy has been hard hit by the collapse in tourism resulting from the pandemic. Government finances have come under pressure after the new administration cut taxes late last year.
Fitch said the country’s external fundraising efforts — ahead of upcoming debt repayments worth around half its $7bn in foreign reserves — could be hampered by turmoil in international financial markets.
The rating agency expects Sri Lanka’s GDP to contract 1 per cent this year, with government debt rising to 94 per cent.
Sri Lanka is one of a number of emerging markets facing credit strain. The country is also facing political uncertainty as parliamentary elections slated for April were postponed until June, and may yet be pushed back further.
Myles McCormick 4/24/2020, 2:47:09 PM
Dyson says new ventilator no longer required in UK
Michael Pooler in London
Dyson has said a brand-new ventilator system it developed for treating coronavirus patients is no longer needed in Britain, after spending £20m on a project that was launched following a government appeal.
The appliances brand was among a number of engineering companies that rushed to answer a call from prime minister Boris Johnson last month to equip the National Health Service with the life-saving machines, which support people with breathing difficulties brought about by Covid-19.
Sir James Dyson said its device was “mercifully” not now required in the UK, adding that the business he founded did not regret its “contribution to the national effort for one moment.”
I have some hope that our ventilator may yet help the response in other countries but that requires further time and investigation.
The billionaire inventor will cover Dyson’s costs and paid tribute to those involved in the initiative.
The Cabinet Office, which is running the government’s ventilator challenge programme, said a number of devices were undergoing tests for regulatory approval and that no decisions had been made.
Anna Gross 4/24/2020, 2:56:33 PM
Coronavirus could turbo-charge sports gambling market
Alice Hancock in London
One of the US’s biggest sports betting operators said that coronavirus could speed up the opening of the sports gambling market in the US as states scramble for tax dollars to pay for the economic fallout caused by the disease.
Jason Robins, chief executive of DraftKings, said he anticipated that states that had put off legalising sports betting after federal courts overturned a ban on the practice in 2018 would “now have bigger tax holes to fill” and would “[move] forward faster with it than they would have”.
Analysts estimate that the US could become one of the largest regulated gambling markets in the world, but its growth depends on the speed at which states’ legislatures put in place sports betting laws. Fourteen states have legalised it so far and seven more are working towards that goal.
DraftKings listed on the NASDAQ on Friday after shareholders approved an unusual $3.3bn three-way deal that will see it merge with the controversial gaming technology company SBTech and a special purpose acquisition vehicle, raising capital and going public at the same time. Its shares were trading up 15 per cent at Wall Street open.
Mr Robins, who founded DraftKings in 2012 and will continue to lead the company, said that due to the widespread cancellation of sports tournaments there had been a pick-up in its New Jersey gaming business and that esports had “absolutely exploded”.
Peter Wells 4/24/2020, 3:10:35 PM
US health regulator warns on hydroxychloroquine combination treatment
Kiran Stacey in Washington
The drug combination touted by Donald Trump as a possible coronavirus treatment could cause patients’ hearts to malfunction, US regulators warned on Friday.
The Food and Drug Administration issued a safety warning about using hydroxychloroquine and azithromycin, the potential benefits of which the US president has frequently talked up during his daily press conferences. The FDA said the drugs could cause heart rhythm problems for some patients, and should be confined to clinical trials or certain cases in hospital.
Stephen Hahn, the FDA commissioner, said in a statement: “While clinical trials are ongoing to determine the safety and effectiveness of these drugs for Covid-19, there are known side effects of these medications that should be considered. We encourage health care professionals making individual patient decisions closely screen and monitor those patients to help mitigate these risks.”
The FDA’s warning comes days after Rick Bright was dismissed as the director of the Trump administration’s Biomedical Advanced Research and Development Authority, a move which Mr Bright said was linked to his doubts about hydroxychloroquine.
Anna Gross 4/24/2020, 3:16:56 PM
‘Great majority’ of UK population has not been infected with Covid-19
Camilla Hodgson in London
The vast majority of people in the UK have not been infected with Covid-19, Chris Whitty, the chief medical officer for England, said on Friday.
“We are confident that the great majority of the population have not had Covid-19,” meaning that there is a strong chance the disease could “take off again” if social distancing measures are prematurely relaxed, he said, giving evidence to the House of Commons’ science and technology committee.
Outside London, which has been among the worst hit regions, it is unlikely that more than 10 per cent of people have contracted the virus, Mr Whitty said.
The UK as a whole has experienced a relatively similar pandemic, unlike China, which saw some areas much more seriously affected than others. As a result, the whole of the UK is experiencing an “artificial peak” at the moment, since lockdown and social distancing measures were put in place simultaneously.
“Because those happened across the country at roughly the same time, that peak is occurring at broadly the same time across the country,” he said.
Anna Gross 4/24/2020, 3:26:07 PM
New outbreak aboard US navy vessel
Katrina Manson in Washington
The US Navy is fighting another coronavirus outbreak aboard one of its vessels, the Navy destroyer USS Kidd, while the Pentagon assures citizens it has “learned lessons” from political furores caused by previous outbreaks on military ships.
One person was flown off the ship for medical evacuation after exhibiting symptoms while at sea in the Caribbean to San Antonio, where they tested positive for coronavirus.
The ship will now come into port as a result of the outbreak, said Jonathan Hoffman, the Pentagon’s public affairs chief, adding that an eight-person medical team boarded the ship within 24 hours of spotting the symptoms to conduct contact tracing and try to stem the spread.
“Fingers crossed,” Mr Hoffman told reporters on Friday, adding the Navy had learned lessons from earlier outbreaks. “The Navy is doing everything they can right now.”
More than 600 crew aboard the aircraft carrier USS Theodore Roosevelt tested positive for coronavirus after an outbreak festered at sea earlier this month, eventually forcing it to dock early at Guam. Its captain was then sacked after he appealed for additional help by acting Navy secretary Thomas Modly, who himself resigned following the furore.
Peter Wells 4/24/2020, 3:52:06 PM
England’s chief medical officer calls for disclosure of scientific advisory team
Camilla Hodgson in London
The membership of the government’s top scientific advisory team should be made public but has been barred from publication because of national security concerns, England’s chief medical officer said on Friday.
Asked whether it would be useful for the membership of the Scientific Advisory Group for Emergencies to be in the public domain, as well as the group’s minutes and the scientific evidence that decisions have been based on, Chris Whitty agreed in theory that it would be.
But he said the group had been given clear advice that, since SAGE is a sub-committee of Cobra and sometimes meets to discuss national security issues, this should not happen.
“In this setting there’s no particular reason in my view for secrecy per se,” Mr Whitty said.
He added that, as part of the decision-making process, members took into account members’ conflicts of interest.
Mr Whitty defended the fact that the group has not published all the scientific evidence that has underpinned its advice to government, since the virus is so new. He said some of it was early stage research that had not been peer reviewed, and that part of the group’s job was to convey uncertainty to ministers when it gave advice.
Peter Wells 4/24/2020, 4:09:47 PM
People in UK’s Midlands refuse going to hospital on infection risk fears
Andy Bounds in Huddersfield
Sick people in the UK have refused to go into hospital for fear of contracting Covid-19, ambulance staff report, adding to fears that thousands are dying unnecessarily at home.
Since early April, some 300 people in the West Midlands have declined to attend hospital when advised for a “range of acute and severe conditions”, according to Toby Lewis, chief executive of Sandwell and West Birmingham NHS Trust.
“The clinician walked away concerned about the ongoing health of the patient,” he said. He said there was now little chance of getting infected with Covid-19 in hospital. “If there was a cause for fear that cause has dissipated. People with acute conditions need to seek healthcare treatment.”
The West Midlands Ambulance Trust is setting up a unit to monitor the health of those who refused hospital treatment. It serves a population of around 3m, so if the problem was similar in the UK as a whole some 6,000 people this month could have declined treatment.
The number reporting heart attacks, strokes and early cancer symptoms has more than halved since the coronavirus pandemic.
The Financial Times has calculated that the virus has caused as many as 41,000 deaths, more than double the official figure of 19,506, which only counts those who have died in hospitals after testing positive.
Anna Gross 4/24/2020, 4:35:49 PM
Heathrow calls on UK government to introduce health checks after lockdown
Jim Pickard in London
Heathrow Airport wrote to the government on Thursday urging it to introduce checks such as antibody tests and health passports on incoming passengers after the immediate lockdown has passed.
But Downing St said earlier that it had no plans to change its current liberal approach to airport checks on the relatively small number of passengers still coming into the UK.
Grant Shapps, transport secretary, told the afternoon Downing St press conference that when the UK comes out of the current crisis and goes “into the next phase” it would continue to keep the medical and scientific advice under review to see if airport procedures should need to change.
But he noted: “Countries that have locked down their flights, I’m thinking of the US, have not necessarily weathered the storm of coronavirus any better.”
Matthew Rocco 4/24/2020, 4:54:27 PM
‘Economic tsunami’ to cost New York $13bn in annual revenue
The “economic tsunami” stemming from the coronavirus pandemic and business shutdowns will cost New York around $13bn in lost revenues, governor Andrew Cuomo said, amid a fight over whether the federal government should approve aid to states and municipalities.
State revenues will fall $13.3bn, or 14 per cent, from New York’s budget forecast, Mr Cuomo said during his daily press briefing. The state faces $61bn in lost revenues over the financial plan period from fiscal 2021 to 2024.
Mr Cuomo in January proposed a $178bn budget for 2021, which assumed an estimated $88bn in state revenue, most of which would come from personal income taxes.
Mr Cuomo said New York was not “in trouble” financially prior to the outbreak, as he renewed his criticism of Republican Senator Mitch McConnell, who has suggested Congress could pass a bill allowing states to declare bankruptcy if necessary.
“I dare you to do that,” Mr Cuomo, a Democrat, said on Friday.
He later added, “Mr McConnell is a taker, not a giver”, arguing that New York contributes more to the federal “pot” than Kentucky. “Just give me my money back,” he said.
Mr McConnell, speaking on a radio show hosted by Hugh Hewitt, said he didn’t want to “just send a blank cheque down to states and local governments to spend any way they choose to”. Some Republican lawmakers have raised concerns over adding new debt, with lawmakers having approved almost $3tn in coronavirus-related emergency spending so far.
A further 422 people in New York died from coronavirus in the past 24 hours, while the state continued to see a decline in new hospitalisations.
Mr Cuomo said the state will make a decision on schools in about one week. Schools across the state have been closed since March.
Matthew Rocco 4/24/2020, 5:10:31 PM
UK pubs and brewers criticise government over beer duty payments
Alice Hancock in London
Pubs and brewers in the UK have been dealt a blow by the government after it rejected a call for a blanket deferral of beer duty payments due on Saturday.
Trade bodies representing the industry had made urgent pleas to the government to defer the monthly tax bill, which totals £750m, as pubs and breweries scramble to hold on to cash to fund their businesses through the coronavirus lockdown.
Around 70 per cent of alcoholic drinks served in pubs are beer. Since pubs have been closed, the UK’s 2,000 brewers have been left with a significant shortfall in revenues. Most are unable to make it up through supermarket or off-licence sales.
“The government’s failure to defer beer duty is a huge blow to pubs and brewers. It will put brewers under even greater financial strain, meaning there is a real risk to their ability to resupply pubs when they can safely re-open after the coronavirus lockdown,” said Emma McClarkin, chief executive of the British Beer & Pub Association, one of the lobby groups.
Peter Wells 4/24/2020, 5:52:34 PM
US stocks higher in afternoon trade
US stocks were higher on Friday, but remained on course for their first weekly drop in three owing to elevated volatility in the oil market.
The S&P 500 was up 0.5 per cent in afternoon trade on Friday, but is heading for a decline of about 2.2 per cent over the past five sessions. Stocks finished about flat on Thursday, trimming earlier gains after a promising antiviral treatment for Covid-19 was revealed to have flopped in its first trial.
The Nasdaq Composite was up 0.8 per cent.
West Texas Intermediate was up 4.2 per cent to $17.22 a barrel. Earlier this week, the active month futures contract for the US crude oil market traded in negative territory for the first time ever, casting doubt over the outlook for the domestic energy sector. Brent crude, the international benchmark, was up 4 per cent at $22.19.
Government bonds were marginally firmer, with the yield on the benchmark 10-year US Treasury less than 0.01 percentage points lower at 0.60 per cent.
Matthew Rocco 4/24/2020, 6:04:26 PM
France expands testing capacity to 40,000 per day
David Keohane in Paris
France’s coronavirus epidemic has continued to decline with the number of coronavirus patients in hospital or needing intensive care falling again as the country upped its testing capacity to 40,000 per day.
Another 389 people have died of the coronavirus in France over the past day, bringing the total number of people who have died in the country to 22,245. Of the increase over the past day, 305 deaths were in hospitals while 84 were in old people’s homes or other care institutions.
Over the same period, the number of people in hospital fell by 561 to 28,658 while the number of people needing intensive care beds fell for the 16th day, by 183, to 4,870. At its peak on April 8, there were 7,148 people in intensive care beds due to the virus.
France is in its sixth week of national lockdown with the confinement of the population due to be eased from May 11, at which point the country is aiming to be able to perform 500,000 tests per week on those people showing symptoms.
On Friday, Jérôme Salomon, France’s director-general of health, said that France could now perform more than 40,000 diagnostic tests per day.
Matthew Rocco 4/24/2020, 6:26:48 PM
Ireland’s prime minister urges compliance with lockdown
Arthur Beesley in Dublin
The total number of coronavirus deaths in Ireland passed 1,000 on Friday as prime minister Leo Varadkar warned that he may extend the country’s lockdown until late May if people do not comply with restrictions on public movement that require them to stay indoors.
The overall number of fatalities now stands at 1,014, after health officials on Friday evening reported 37 new laboratory-confirmed Covid-19 deaths and a further 185 “probable” deaths where doctors suspected the disease but did not carry out a test. There are 18,184 confirmed infections in the country.
The lockdown remains in place until May 5, but Mr Varadkar’s government is concerned about slippage in peoples’ compliance with measures that have been in force since last month. After curtailing the spread of Covid-19, health officials say it could escalate again if people increasingly defy the rules in anticipation of the restrictions being eased.
“We are in a situation now in Ireland where we do seem to have suppressed the virus in the community. There is the prospect of easing some of the restrictions after May 5. All of us want that to happen but it is actually in our hands as a society if we do the right thing for the next 11 days,” Mr Varadkar told a press conference.
People thinking of breaking the restrictions should bear in mind the consequences, he added.
“It could be having to extend the current lockdown by two or three weeks. And that’s not worth it just for a few hours of breach and I’d really ask people to accept that message and certainly I‘m trying to use the power of persuasion as much as the powers that the [police] have.”
Peter Wells 4/24/2020, 7:06:56 PM
Amazon extends double overtime pay as workers protest with ‘sick out’
Dave Lee in San Francisco
Amazon employees globally will continue to receive an extra $2 per hour in pay until at least mid-May, the company said, extending a policy that was due to expire at the end of this month.
Employees in the US and Canada will also continue to get double overtime pay as part of the measures to keep Amazon’s vast logistics operation capable of handling increased demand. The extension means the company now expects to spend $700m on additional staffing costs, up from the $350m it predicted in March when it first implemented the policy.
Employees will, however, lose one emergency benefit that had been in place: workers can no longer take unlimited unpaid leave, a move designed to make it possible for workers to stay home for whatever reason during the coronavirus pandemic. The company is reverting to its previous policy, where most workers can take about 80 hours unpaid leave a year – in additional to paid leave.
Allowances would be made for workers who are high risk, or need accommodate school closures, Amazon said. But workers’ rights groups argue that the change puts pressure on workers to go back to facilities that may not be safe. Amazon will not disclose the number of cases of coronavirus within its company.
“Rather than listen to the workers who are putting their lives on the line in the middle of a pandemic, Jeff Bezos has taken an incomprehensible and cruel decision to put workers and our public health in jeopardy,” said Dania Rajendra, from workers’ rights group Athena.
On Friday, a number of workers staged a “sick out” – calling in sick – to demand Amazon do more to protect workers during the crisis. Organisers said 300 workers had signed up to take part, but it is unclear how many did.
“We stand in solidarity with Amazon workers who are speaking up for their rights,” said Joe Westby of Amnesty International, which backed the action.
Peter Wells 4/24/2020, 7:18:37 PM
France to extend €7bn loan package to Air France-KLM
David Keohane in Paris
France has agreed a €7bn loan package for airline Air France-KLM as it struggles with the impact of coronavirus and is also working on a deal for carmaker Renault which will be worth some €5bn.
“Air France’s planes are grounded, so we need to support Air France,” said French finance minister Bruno Le Maire on television on Friday evening, adding that the loans would come with conditions including that “Air France must become the most environmentally friendly company on the planet.”
Air France-KLM’s shares have fallen 55 per cent so far this year as the whole airline sector has been devastated by the lockdowns put in place to stop the spread of the coronavirus.
The loans, said the French finance ministry without providing further detail, were “intended solely for the needs of the subsidiary Air France”. The state currently holds 14.3 per cent of the airline, while the Dutch state holds 14 per cent.
“The Dutch state has also stated its intention to support the KLM Group” and discussions are ongoing Air France-KLM said in a statement on Friday evening. A further loan of €3bn is believed to be on the way.
Without the funding from the governments, which still must be approved in Brussels, said the group, “a liquidity injection would be necessary in the third quarter of 2020”.
Mr Le Maire also confirmed that the state was preparing a €5bn loan for French carmaker Renault which this week said it was burning through €600m per month in cash, not including working capital. The state is also Renault’s biggest shareholder, with just over 15 per cent of the capital.
Matthew Rocco 4/24/2020, 7:34:01 PM
US deficit may swell to $3.7tn this year
The US budget deficit could surge to $3.7tn this year following massive government spending in response to the coronavirus pandemic and economic turmoil caused by widespread business shutdowns.
The US Congressional Budget Office’s preliminary projections also include a $2.1tn deficit in the following fiscal year ending in September 2021, while the size of the economy won’t fully recover until at least 2022.
Real GDP is seen dropping nearly 40 per cent in the second quarter on an annualised basis, followed by growth of 23.5 per cent in the third quarter.
Phillip Swagel, director of the nonpartisan CBO, said the deficit projections assume that “laws currently in place governing spending and revenues generally remained unchanged and no significant additional emergency funding was provided”.
A deficit of $3.7tn would be more than triple the CBO’s previous forecast. In March, the CBO estimated deficits of just over $1tn in fiscal 2020 and 2021. It would also mark a new record, more than double the previous high set during former president Barack Obama’s first year in the White House.
Congress has passed four bills providing nearly $3tn in emergency spending so far to fund the government’s response to the coronavirus pandemic and provide aid to Americans and small businesses. The closure of businesses deemed non-essential has forced millions of Americans out of work, with applications for unemployment benefits totalling more than 26m over the past five weeks.
The unemployment rate is expected to average 15 per cent in the second and third quarters, up from less than 4 per cent in the first quarter, according to the CBO. It said unemployment would fall to 9.5 per cent by the end of 2021.
“The labor market is expected to improve after the third quarter, with a rebound in hiring and a significant reduction in furloughs as the degree of social distancing diminishes—leading to an increase in business activity and an increase in the demand for workers,” the report said.
Matthew Rocco 4/24/2020, 8:21:59 PM
Wall Street gains more than 1%
US stocks closed near session highs after Donald Trump raised the prospect of offering support to the energy and airline industries.
The S&P 500 gained 1.4 per cent. The Nasdaq Composite was up 1.7 per cent.
Despite Friday’s gains, the benchmark S&P 500 fell 1.3 per cent on the week, snapping a two-week winning streak after an unprecedented slump in oil prices hammered shares in energy groups at the start of the week.
Oil extended its recovery on Friday, recovering from losses seen earlier in the session. Brent crude rose 0.5 per cent to $21.44 a barrel. West Texas Intermediate jumped more than 2 per cent to $16.94 a barrel.
Mr Trump told reporters that the US government could make advance purchases of fuel and plane tickets to help oil companies and airlines.
The yield on the 10-year Treasury fell 0.02 percentage points to 0.59 per cent.
Peter Wells 4/24/2020, 8:26:45 PM
US government’s small business rescue plan to reopen on Monday
Laura Noonan in New York
The US government’s small business rescue scheme will re-open on Monday morning, Treasury Secretary Steven Mnuchin said on Friday.
Small businesses and independent contractors have been eagerly awaiting the $320bn second round of the Paycheck Protection Program since the $349bn funding for the first round was exhausted on April 16.
“The Small Business Administration will resume accepting PPP loan applications on Monday, April 27 at 10:30AM EDT from approved lenders on behalf of any eligible borrower,” Mr Mnuchin said.
He encouraged lenders to “process loan applications previously submitted by eligible borrowers and disburse funds expeditiously”.
Several banks have told the FT that their backlog of applications exceeds the tens of billions they have already put through, and warned that the second programme could be quickly exhausted.
Postponing the relaunch until Monday reduces the chance of a chaotic relaunch, since banks and the SBA will have the weekend to hammer out the best way of pushing through the hundreds of thousands of applications that banks have ready to file.
Peter Wells 4/24/2020, 8:32:47 PM
US business leaders urge coordination between states and White House
Andrew Edgecliffe-Johnson in New York
US business leaders are calling for more coordination between states and the federal government as they grapple with inconsistent guidance on when it will be safe to bring employees back to work.
“We believe a consistent and coordinated approach is urgently needed to create trust in resuming activities and spur the demand necessary to invigorate the economy,” Doug McMillon, the chief executive of Walmart and chairman of the Business Roundtable, wrote in letters to state governors and Mike Pence, Donald Trump’s vice president.
The call from the BRT, one of the most prominent lobby groups for big business in Washington, came on the day that small gyms, hair salons and other small businesses were allowed to reopen in Georgia. Most large chains remain cautious about reopening as they face concerns from employees and fear possible legal risks should they suffer a workplace outbreak of Covid-19.
Employers wanted guidance on issues such as how to configure workplaces, what personal protective equipment to supply, and how to screen employees before they come back to offices and factories, the BRT said.
The ability to bring people back to work would also depend on policymakers prioritising the provision of safe schools, childcare, public transportation and comprehensive healthcare services, it added.
Matthew Rocco 4/24/2020, 9:25:54 PM
US Navy leaders recommend reinstatement for ousted commander
Katrina Manson in Washington
Navy leaders have recommended Captain Brett Crozier be reinstated as commander of the aircraft carrier he was sacked from over his stricken appeal for help as the vessel faced an accelerating outbreak of coronavirus at sea, according to people familiar with the matter.
Acting Navy secretary Thomas Modly recalled Captain Crozier from the USS Theodore Roosevelt after an emotive letter the captain wrote leaked into the press, but subsequently resigned himself over his own misguided handling of the case.
The aircraft carrier eventually docked at Guam, where more than 850 of the 5,000-strong crew have now contracted the disease, including Captain Crozier himself. “We are not at war. Sailors do not need to die,” Captain Crozier wrote in his four-page appeal. One sailor subsequently died.
Pentagon public affairs chief Jonathan Hoffman said earlier on Friday that US defence secretary Mark Esper was “generally inclined” to support the Navy leadership in whatever decision it made. But Mr Hoffman later said Mr Esper had received only “a verbal update” of a preliminary inquiry from Navy leaders following a meeting on Friday and was still waiting for “a written copy of the completed inquiry” in order to review it thoroughly. One person said Mr Esper wanted to review the decision over the weekend, pending support from the White House.
The Navy said it was “continuing discussions” with Mr Esper and that no final decisions had been made.
“If you reinstate Crozier you make things right with the men and women of the Navy who were very upset because Captain Crozier did what the Navy has said they want their captains to do – which is take a hard stance,” said Guy Snodgrass, a former Navy officer who previously worked with Captain Crozier and has advocated for his reinstatement.
Matthew Rocco 4/24/2020, 9:52:09 PM
US death toll rises above 45,000
The number of US deaths attributed to coronavirus passed 45,000 on Friday.
Data compiled by the Covid Tracking Project showed 890,816 confirmed cases of the virus, up from 859,318 a day earlier. The death toll climbed 1,772 to 45,786.
A further 422 people in New York – the state hit hardest by the pandemic – died from coronavirus in the past 24 hours, bringing the total to 16,162. Officials said 271,590 residents had tested positive, while the state continued to see a decline in hospitalisations.
In New Jersey, which has recorded the second-most infections and fatalities, confirmed cases stood at 102,196 with 5,617 deaths.
Matthew Rocco 4/24/2020, 10:03:08 PM
US to send ventilators to other countries amid ‘over-capacity’
Kiran Stacey in Washington
The US has more ventilators than it needs and will start sending them to other countries to help battle the coronavirus crisis, Donald Trump has said.
Speaking at his daily press conference on Friday, the US president said: “We have tremendous capacity – now over-capacity – of ventilators. We’re filling up stockpiles for our states and for ourselves, [the] federal government is over 10,000 ventilators and we could have a lot more if we wanted to do that.
“But we’re helping Mexico, Honduras, Indonesia, France, we’re sending to France we’re sending to Spain, we’re sending to Italy, and will probably be sending to Germany should they need them.”