Turkey’s virus deaths may be 25 per cent higher than official figure

Turkey’s death toll from coronavirus could be as much as 25 per cent higher than the government’s official figure, adding the country of 83m people to the raft of nations that have struggled to accurately capture the impact of the pandemic.

Ankara has previously rejected suggestions that municipal data from Istanbul, the epicentre of country’s Covid-19 outbreak, showed that there were more deaths from the disease than officially reported.

But an analysis of individual death records by the Financial Times raises questions about the Turkish government’s explanation for a spike in all-cause mortality in the city of almost 16m people.

The FT findings show 3,377 more deaths in Istanbul when compared with the average for the same period in March and April over the previous five years.

Nationwide, all-cause mortality data for Turkey are only available with a lag of more than a year. But the Istanbul figures suggest that the true Turkey-wide toll is 25 per cent higher than the official figure, which stood at 2,706 on April 26.

Chart showing Istanbul has recorded about 3,400 more deaths in recent weeks than during the same period in previous years, an increase of 33%

“These figures indicate under-reporting of Covid-19-related deaths,” said Onur Altindag, an economist specialising in health at Bentley University in Massachusetts, US. “There are clear patterns of excess mortality in Istanbul, which is not surprising.”

Mr Altindag stressed that there was no evidence of deliberate misreporting, adding that accurate coronavirus mortality data was “a notoriously difficult task even for countries with the most advanced death registries”. 

Previous analyses by the FT have suggested that the death toll in the UK is double the official figure, while the worldwide figure could be 60 per cent higher than reported.

The true death toll has become a subject of heated debate in Turkey, a deeply polarised country where there is profound mistrust between opposition groups and the government.

Doubts about the figures have been stoked by the government’s sometimes harsh response to those who have questioned the data — including the arrest of several hundred people for “provocative” social media posts — and its reluctance to publish regional breakdowns.

The FT’s analysis lends credence to warnings from the Turkish Medical Association (TTB), a trade union, that the official death toll is under-reported. Deaths from coronavirus are only officially counted following a positive test, and the TBB says that, while testing levels have increased, they are still not high enough.

Yet the analysis also supports President Recep Tayyip Erdogan’s claim that Turkey has a much lower death rate than many European countries and several US states. It corroborates official assertions that the country has reached a “turning point” in the outbreak, with the number of new daily deaths on the decline.

Details of deaths in Istanbul are available almost in real time through a central government website. A comparison of this year’s data with previous years shows a marked spike in deaths that began in mid-March, less than a week after Turkey’s first confirmed case of Covid-19.

Healthcare workers tend to a patient at one of the intensive care units for Covid-19 patients at Akdeniz University Hospital in Antalya
Healthcare workers tend to a Covid-19 patient at Akdeniz University Hospital in Antalya © Ibrahim Laleli/DHA/AP

Some of these deaths could be explained by a reluctance among people who are sick with other ailments to go to hospital to seek treatment amid the pandemic. But expert consensus worldwide is that the impact of that phenomenon is usually dwarfed by deaths from coronavirus.

Stephen Evans, a statistical epidemiologist at the London School of Hygiene and Tropical Medicine, said that all-cause mortality was important for examining the true impact of the outbreak. “You actually need to look at total deaths, and not just deaths ascribed to Covid-19,” he said.

Turkey’s government has repeatedly rejected assertions that the Istanbul figures point to a higher-than-reported death toll from coronavirus in the country. Responding to an article published last month by the New York Times, Turkey’s health minister Fahrettin Koca insisted that the Istanbul data set was a registry of burials in the city rather than a registry of deaths.

He said that travel restrictions aimed at stopping the spread of coronavirus meant that Istanbul residents who would normally be buried in their ancestral homeland were instead being laid to rest in the metropolis, leading to higher than usual burial numbers.

Ekrem Imamoglu, the opposition mayor of Istanbul, disputed this, claiming that 30 to 35 per cent more people were dying than usual in the city.

The FT analysis supports Mr Imamoglu’s assertions. It shows that, both before and after the onset of the virus outbreak, people who died in Istanbul but were buried elsewhere were usually logged in the city’s records. 

Asked to comment on the findings, Turkey’s health ministry directed the FT to comments made by Mr Koca during a press conference last week. 

The health minister accused some people of trying to “play politics” with the crisis and rejected claims that the official death toll could be incorrect.

He said that there had been a small increase in nationwide all-cause mortality this year, which was lower than the official coronavirus death count. “Where are they, these imaginary deaths?” he said.

But Kayihan Pala, a public health expert and a former opposition parliamentary candidate, said deaths due to some other common causes could have dropped during the pandemic. “We also need to examine the secondary effects of measures taken against coronavirus,” he said. “For example, because of the decrease in traffic, deaths linked to traffic accidents may have fallen.”

How the FT analysed Turkey’s real death toll

The FT examined 15 Turkish media reports of deaths from both before and after the coronavirus outbreak. All of the cases were people who died in Istanbul and were buried elsewhere in Turkey.

In 11 out of the 15 cases, we found that those who died had been logged in the Istanbul records, even though they were buried in other provinces. This raises questions about official claims that the Istanbul data shows burials in the city, rather than deaths.

For example, Cengiz Koc, the father of an official from Turkey’s ruling party, died of a heart attack in Istanbul in February and was buried in Konya. His death appears in the Istanbul data. 

The same recording practice has continued since the onset of the coronavirus outbreak, both for Covid-19 deaths and those from other causes.

Nafiye Ilce, a woman in her nineties who died in Istanbul in late April, was buried in Amasya province but appears in the Istanbul records.

The FT only examined data for Turkey’s largest city. Bentley University’s Onur Altindag, who has analysed data for 10 other provinces across Turkey, said he found “little evidence” of a similar upsurge in mortality rates in those regions, suggesting that the problem of under-reporting may be limited to Istanbul.

But recent death records for Ankara and Izmir — Turkey’s second and third-biggest cities — are not publicly available. The government has resisted calls to publish a daily city-by-city breakdown for confirmed coronavirus cases and deaths.

Coronavirus latest: UK calls spread of Covid-19 in care homes a ‘challenge’

A quarter of Canadian companies seek loans to weather Covid-19

More than one in four Canadian businesses requested loans in the first quarter to cover operating costs due to lost income from Covid-19, with a further quarter of those companies seeing their requests denied, according to an official survey.

Despite government programmes to back business lending, Statistics Canada said only 77 per cent of businesses that asked for credit to cover losses during the pandemic had their loans fully or partially approved — based on a “crowd-sourced” online survey of 12,600 companies.

A fifth of businesses that pay rent deferred those payments.

The survey showed a widespread drop in revenues due to falling demand, with half of businesses reporting revenues down 20 per cent or more year-on-year in the first three months of 2020 — and one-third seeing a more-than 40 per cent hit.

The economic fallout of the pandemic showed a sharp split by sector. Around 40 per cent of agriculture, forestry, and utilities businesses recorded growth or steady income, while travel, entertainment, and food services companies suffered greater losses.

The survey also showed signs of businesses adapting to new trading conditions, with two-fifths adding new ways to sell or communicate to customers in the quarter and 3 per cent making new products. Nearly two-thirds said they could re-start normal operations within a month, when permitted.

India to allow stranded migrant workers to travel home

Amy Kazmin in New Delhi

Prime Minister Narendra Modi’s government has decided that millions of migrant workers stranded in cities and industrial areas far from their rural community will be permitted to return to home if they wish, as India prepares to ease its draconian six-week lockdown.

In an official order, New Delhi said that the return of stranded migrant workers will have to be organised in batches by officials from their home states in conjunction with authorities in the states where they are presently located.

“Sending and receiving states may consult each other and agree to movement by road,” the order said. It also said all those stranded migrants who wish to return to their homes must be screened and only those showing no symptoms of illness would be permitted to leave.

Millions of migrants were left stranded far from home when India abruptly suspended all public transport on March 22, just days before it announced a strict national lockdown. Many undertook arduous – and sometimes fatal – treks to try to get back to their homes, but millions remain stuck, mostly dependent on food handouts to survive.

Amid rising desperation – and fears of social unrest – some states, including Uttar Pradesh, and Madhya Pradesh, have already begun bus services to help ferry stranded migrants back to their homes.

US refiner Valero Energy sinks to $1.9bn loss in the first quarter

Derek Brower, US energy editor

Valero Energy, one of the US’s biggest oil refiners, on Wednesday reported a $1.9bn net loss in the first quarter of 2020 and said it would reduce planned capital expenditure by 16 per cent, amid a “very challenging start to the year” as coronavirus lockdowns came into force and sapped fuel demand.

The company also reported a $2bn after-tax charge related to the lower price of its inventory in the first quarter. Total revenue of $22.1bn for the quarter was down from $24.3bn a year earlier but easily topped analysts’ expectations, according to S&P CapitalIQ data.

“It’s been a very challenging start to the year with significant impacts to families, communities and businesses world-wide brought on by the Covid-19 pandemic,” said Joe Gorder, Valero’s chief executive.

Valero’s shares are down 40 per cent since the start of the year but on Wednesday rose in pre-market trading by about 3.3 per cent to $59.81. Valero said its refinery throughput amounted to 2.8m barrels a day in the first quarter, in line with the same period a year earlier, partly reflecting market conditions before lockdowns were put in place.

US futures jump on positive results for Gilead’s possible Covid-19 drug

Hannah Kuchler in New York

US futures jumped after Gilead said its possible drug for the coronavirus had positive results in a US study, after shares in the California-based biotech fell last week when an accidental early publication of results revealed a trial in China had been unsuccessful.

Nasdaq 100 futures were up about 2 per cent and S&P 500 futures were up 1.9 per cent following the news. Shares in Gilead were halted and then rose almost 9 per cent in pre-market trading after the company said it was aware of “positive data” from the study run by the US National Institutes of Allergy and Infectious Diseases. The NIAID did not respond to a request for comment.

“We understand that the trial has met its primary endpoint and that NIAID will provide detailed information at an upcoming briefing,” Gilead said.

The company also released results from its own study, which appeared to show patients did just as well after a five day course of the drug, than after ten days. However, this study did not have a control arm comparing patients on remdesivir to patients who were not taking it and is not peer-reviewed.

Merdad Parsey, chief medical officer at Gilead, said that study “complements” the placebo controlled study by NIAID. If patients do not require a ten day course of the drug, “it could significantly expand the number of patients who could be treated with our current supply of remdesivir”, he said.

India backs contact tracking app for workers to go into office

Amy Kazmin in New Delhi

India has ordered central government employees to download its coronavirus contact tracking app so as to check how low an exposure risk they are before going to the office every morning, as the country prepares to ease a six-week lockdown.

The instructions came in an order from the ministry of personnel on Wednesday, a day after an official in Niti Aayog, the government’s main policy think-tank, tested positive. New Delhi unveiled the Aarogya Sethu, or Bridge to Health, app which alerts people whether they have come close to someone who later tests positive for Covid-19.

While privacy activists have expressed concern about the use of the data, Narendra Modi, the prime minister, has appealed to Indians to put the app on their phones. As of April 25, the app has been downloaded 75m times.

It is clear that the use of the app will not be optional for civil servants working in the central government. Officials must check it before setting out for work, and should only report for duty if the app confirms they are at “safe” or “low risk” status.

Any civil servants whose status report shows them at “moderate” or “high risk” of infection, based on recent proximity to another infected person as detected by Bluetooth, will be required to stay home and self-quarantine for 14 days, the order says.

Wall Street on track to open higher

US stocks were set to open higher, while oil prices rebounded on hopes that a glut in global crude markets was easing.

Futures tied to the S&P 500 were 1.3 per cent higher with less than an hour to go before the opening bell, while European and Asian markets advanced.

Investors are gaining a better idea of the impact of Covid-19 on the US economy through a packed schedule on Wednesday. Figures just released showed US GDP contracted in the first quarter at the fastest rate since 2008, while the Federal Reserve will conclude its two-day policy meeting later in the afternoon.

Earnings from Alphabet and Boeing helped support sentiment before the opening bell, while Microsoft and Facebook will report later in the day.

Futures added to their earlier gains after Gilead Sciences said it “is aware of positive data” relating to a trial of coronavirus treatment drug Remdesivir. Still, it is worth viewing medical hopes with caution. An optimistic report on a Gilead drug boosted risk sentiment globally in mid-April before flopping in its first trial.

Mastercard reports jump in credit card spending

Robert Armstrong in New York

Spending by Mastercard’s customers rose 8 per cent in the first quarter, despite the coronavirus, driving revenue growth of 5 per cent, adjusting for currency.

In the US, spending growth on Mastercard credit cards, at 7 per cent, outran debit card spending, which increased by 5 per cent. Both debit and credit spending were particularly strong in Europe, rising by 12 per cent in local currencies.

Both revenues, at $4bn, and earnings per share, at $1.83, were slightly ahead of Wall Street’s expectations. Despite rising revenue, net income of $1.7bn declined by 7 per cent from the same period last year, hit by rising expenses and investment losses.

Mastercard repurchased 4.7m shares for $1.4bn in the quarter, but said that it had temporarily suspended its buyback programme until visibility into the economic situation improves.

Shares in the company rose 3 per cent in early trading on Wednesday. They have declined by over a fifth since the virus first began to impact markets in late February.


US economy suffers sharpest contraction since financial crisis

Mamta Badkar in New York

The US economy contracted in the first quarter at the fastest rate since 2008, marking an end to the longest expansion on record as the lockdowns aimed at curbing the coronavirus pandemic caused widespread disruption.

Gross domestic product, or the value of all goods and services produced by the economy, shrank at a 4.8 per cent annualised rate in the first three months of the year, according to the preliminary estimate from the Bureau of Economic Analysis published on Wednesday. That marked the first quarterly contraction in six years and compared with economists’ forecasts for a 4 per cent decline in output.

American consumers, who had been a driving force in the economy, retrenched spending as state governments nationwide began to announce lockdowns last month in an effort to curb the spread of coronavirus, and businesses laid off millions of workers. Retail sales fell 8.7 per cent in March, the most since records began in 1992.

However, as lockdowns only began in earnest in mid-March, economists have cautioned the worst is yet to come for the US economy.

Boeing to cut production as it posts $641m quarterly net loss

Claire Bushey in Chicago

Boeing has said it will cut production rates for nearly its entire portfolio of commercial aeroplanes, signalling that its workforce will shrink in size as the coronavirus pandemic throttles global demand for jets.

The areospace company posted a $641m net loss in the first quarter compared with $2.1bn in net income for the same period last year. Revenue fell more than a quarter to $16.9bn. Boeing also reported a flurry of charges totalling $2.3bn.

The 737 Max will have a “slower than planned” ramp-up once production resumes, increasing to 31 per month in 2021. The wide body 787 Dreamliner will halve production, while the 777 and 777x will go from five craft a month to three in 2021. The company will continue to make 767s and 747s at the same rates.

The aerospace manufacturer closed plants in Washington state, South Carolina and suburban Philadelphia for weeks due to the spread of Covid-19. Though they have since reopened, the company’s airline customers continue to suffer from plummeting demand for air travel, prompting them to defer deliveries on jets.

UK to help support vulnerable gamblers during lockdown

Alice Hancock in London

The UK’s gambling industry regulator is funnelling £9m towards charities that deal with vulnerable players as fears rise about a spike in betting-related harm during the coronavirus lockdown.

The money, which comes from fines issued by the Gambling Commission to operators that have flouted rules around anti-money laundering and monitoring of problem gamblers, will be directed by the charity GambleAware to treatment centres and support services around the UK.

Since the beginning of this year, the industry has paid £27m in settlements over regulatory action.

Regulars are gambling more often under lockdown and turning to more addictive forms of online betting such as casino games and slots due to the lack of sport, the Gambling Commission indicated on Monday.

However, charities such as GamCare said that they had not seen an uptick in calls for support, adding that it fears that fewer people will ask for help while they are in constant proximity to their families.

UK extends visa scheme for health staff

Robert Wright in London

A scheme to ensure staff in the UK’s National Health Service were free from worries about their immigration status during the coronavirus outbreak has been extended to new groups of staff, including midwives, social workers and medical radiographers.

Priti Patel, home secretary, announced the step on Wednesday as she appeared before a virtual sitting of the House of Commons’ Home Affairs Committee.

She also announced that the families of members of NHS staff who died of coronavirus would automatically be offered indefinite leave to remain in the UK.

However, members of the committee criticised Ms Patel for her failure to bring into the scheme some manual workers such as hospital porters and cleaners and for excluding staff in the social care sector.

Yvette Cooper, the Labour MP who chairs the Home Affairs committee, said it seemed “very unfair” to social care workers that they were not included in the scheme.

The scheme automatically grants a year’s visa extension, without payment of any fees, to any of the staff included whose visas are due to expire before October 1.

The provision covers mainly staff from outside the European Economic Area – the EU plus Norway, Iceland and Liechtenstein – who are on Tier 2 visas for skilled professionals.

Yum profits tumble as pandemic hits businesses

Yum Brands, the owner of fast food franchises KFC, Taco Bell and Pizza Hut, reported a 68 per cent decline in its quarterly profit as its restaurants worldwide were hit by efforts to slow the coronavirus pandemic.

“First-quarter results reflect two different realities,” said David Gibbs, chief executive of Yum Brands. “We began the year with momentum across many of our businesses, however as the quarter progressed we were heavily impacted by the unfortunate spread of Covid-19.”

The Louisville, Kentucky-based company either closed stores or limited its restaurants to take-out or delivery as countries around the world announced lockdowns in response to the outbreak. Globally, about 7,000 restaurants had closed by mid-March.

Overall revenues climbed 1 per cent from a year ago to $1.26bn in the three months ending in March, ahead of analyst expectations for $1.2bn.

Worldwide same-store sales fell 7 per cent from a year ago, with sales at KFC chain and Pizza Hut down 8 and 11 per cent respectively. However, Taco Bell bucked that trend and reported a 1 per cent increase in same-store sales.

Net income however fell to $83m or 27 cents a share, down from $262m or 83 cents a share in the same quarter a year ago. Adjusting for one-time items, earnings of 64 cents a share, missed analysts’ expectations by a penny.

President Xi declares Wuhan’s victory over coronavirus

Christian Shepherd in Beijing

China’s president Xi Jinping has declared victory over coronavirus in the central province of Hubei and its capital Wuhan, where the pandemic began.

“After arduous and extraordinary efforts, Hubei and Wuhan have achieved a decisive result in their defensive battle [against Covid-19],” Chinese state media reported Mr Xi telling the Communist party’s politburo standing committee on Wednesday.

Mr Xi also warned officials not to drop their guard, warning that risks from “imported” cases and a resurgence of Covid-19 remain severe.

Earlier on Wednesday, China’s parliament announced that its delayed annual legislative meeting would be held in Beijing in late May, in the clearest sign yet of the leadership’s confidence that it has contained the outbreak.

UK first secretary admits Covid-19 in care homes is a ‘challenge’

Laura Hughes in London

Dominic Raab has admitted the spread of coronavirus in care homes is a “challenge that we must grip”, as he stood in for the prime minister at Wednesday’s PMQs.

The first secretary said he would not “shy away” from admitting it was a challenge, after the latest figures showed much of the increase in deaths came from care homes. Mr Raab was deputising for Boris Johnson after the prime minister and his fiancée announced the arrival of a “healthy” baby boy on Wednesday morning.

Sir Keir Starmer, Labour leader, described the total numbers of fatalities in the UK as “truly dreadful”.

He said:

Six weeks ago on March 17 the Government’s chief scientific adviser indicated the Government hoped to keep the overall number of deaths from coronavirus to below 20,000.

He said that would be ‘good’ by which in fairness to him he meant successful in the circumstances. But we’re clearly way above that number and we’re only partway through this crisis and we’re possibly on track to have one of the worst death rates in Europe.

On Monday, the Prime Minister said in his short speech that many were looking at our apparent success in the UK. But does the First Secretary agree with me that far from success these latest figures are truly dreadful?

Mr Raab responded:

This is an unprecedented pandemic, a global pandemic, and I think in fairness we shouldn’t criticise either the CMO or the deputy CMO for trying to give some forecast in response to the questions that many in this chamber and many in the media are calling for.

Sir Keir also asked when the government would “fix” the issue of inadequate supplies of personal protective equipment (PPE) for frontline NHS staff.

Mr Raab admitted there were “challenges on the front line” and ministers are doing “absolutely everything” they can to make sure those workers get the equipment that they need.

Calling for ministers to publish an exit strategy, Sir Keir said the public “need to know what’s going to happen in the next phase.”

Mr Raab responded:

He’s asked for a time frame and a date, we can’t give it until we have the Sage evidence. If he thinks there’s things that we could be announcing, whether it’s workplaces which he referred to, schools, or otherwise, feel free to propose those things.

Disadvantaged UK schoolchildren cannot expect to receive laptops yet

Bethan Staton in London

The UK will take a phased approach to reopening schools as the coronavirus lockdown eases, but government-promised tech support for disadvantaged children may not be available until June.

Gavin Williamson on Wednesday told the UK’s parliamentary committee for education that he could not yet give a date for when schools might reopen, but that he expected children to return in a phased manner, and “with as much notice as possible”.

“We are working very closely with the whole sector in terms of actually when is going to be the best time to bring schools fully back into operations,” the UK’s education secretary said.

Schools in the UK have since mid-March been open only for a small number of vulnerable pupils or the children of key workers. Concerns over education disadvantage have charged the debate about when students should return. Concern has mounted over technological inequality that has left some children unable to access online learning tools, a centrepiece of national strategy to continue education from home.

Although the government has launched a scheme to provide tech facilities for disadvantaged children, Mr Williamson told MPs that laptops promised under the programme would not be available for most children until late May or June.

He added that there were no plans to reopen schools in the summer holidays, pouring cold water on one proposal for narrowing the attainment gap.

The government is looking at a “range of interventions” to support disadvantaged students who may have fallen behind during the period of shutdown, he said.

Care home patients make up half of Scotland’s Covid-19-related deaths

Mure Dickie in Edinburgh

More than half of coronavirus-related deaths in Scotland in the week to April 26 occurred in care homes.

The weekly statistics compiled by the National Records of Scotland, which offer the most up-to-date view of coronavirus mortality in the UK, highlight the toll taken by care homes and their status as a battleground in attempts to control Covid-19.

Total deaths in care homes in which coronavirus was mentioned as a factor reached 886 by April 26, up 349 from a week before, the figures revealed on Wednesday. Scotland’s total coronavirus-linked deaths hit 2,272 over the same period, up 656.

The proportion of deaths in care homes has risen sharply in recent weeks. Up to April 12, just a quarter of coronavirus deaths were in such facilities, compared with 62 per cent in hospitals.

Hugh Pennington, emeritus professor of bacteriology at the University of Aberdeen, told a Scottish parliament committee on Tuesday that more needed to be done to stop coronavirus getting into care homes.

“I would classify care homes where there have been cases of the virus as almost super-spreading environments where the virus is going on the rampage,” Prof Pennington said.

China’s tech sector gets a ‘shot in the arm’ from Covid-19 recovery

China’s technology manufacturing industry has rebounded at a “surprisingly” vigorous pace, research shows, suggesting that at least some portions of the economy could stage a rapid recovery from the Covid-19 slump.

After bottoming in February, the world’s second-biggest economy has picked up since March, with the tech sector leading way, US investment bank Morgan Stanley has said in a note to clients.

The acceleration in production in the tech sector has “proceeded at a surprisingly fast pace and the worst should be behind us”, wrote Katy Huberty, equity analyst at Morgan Stanley. She pointed to data that show air quality in Zhengzhou, site of some iPhone manufacturing, worsened to above the seasonal trend for most of April, suggesting production has been higher than in previous years.

“Every secular technology growth trend is getting a shot in the arm because of the Covid-19 shock,” she added, pointing to the increase in demand for cloud computing and work from home technologies.

Smartphone demand has staged a V-shaped recovery, in March increasing 22 per cent year-on-year. iPhone sales increased fivefold, from 500,000 to 2.5m.

Ms Huberty wrote:

Technology vendors are encouraged by the pace at which China’s production has ramped up post the Covid-19 shock and this has reinforced their belief in locating the production of their high volume products in China.

UK competition watchdog warns private schools over collusion

Andrew Jack in London

The Competition and Markets Authority has warned private schools to avoid collusion by exchanging plans around fee reductions discounts as a result of the impact of coronavirus.

In a letter to independent schools organisations, Howard Cartlidge, senior director, cartels, at the regulator, said:

We have become aware that individuals at some schools may be engaging in discussions with each other about the level of discounts and/or refunds on school fees.

Citing past action against the sector in 2006, he said the authority would “not tolerate” such practices and that schools failing to comply would face fines and risked undermining public trust in the sector.

Barnaby Lenon, chair of the Independent Schools Council, said the letter was “a helpful warning” and he agreed with it. “Schools are not allowed to collude on future fees and as far as I know have not been doing so,” he said.

Robert Verkaik, co-founder of Private School Policy Reform, a think-tank, said:

Those parents who have spent tens of thousands of pounds to send their children to an independent school will be rightly very angry if some of the schools are working against their interests by setting uncompetitive fees. Many private schools today are really multimillion-pound corporations masquerading as charities.

Spotify subscriber growth tops view and search for ‘chill’ music rises

Anna Nicolaou in New York

Spotify added more new subscribers than forecast in the first three months of the year, during which the music streaming company noted a rise in searches for “chill” and “instrumental” music as coronavirus lockdowns took hold across the world.

The dominant music streaming company added 6m subscribers in the first quarter to reach 130m paying customers, ahead of the 129m Wall Street analysts had forecast.

Spotify shares climbed more than 4 per cent in pre-market trade. The company’s stock has fared better than the broader market, dropping 5 per cent this year, compared with an 11 per cent fall in the S&P 500.

While Netflix has been boosted by lockdowns that kept people at home, the coronavirus effect on music streaming has been less clear. Some analysts expected that fewer people commuting to work might mean less time spent using Spotify.

Spotify on Wednesday confirmed that music listening had changed during the pandemic. “Morning routines have changed significantly,” Spotify said in a letter to investors. “Every day now looks like the weekend.”

However, despite some “notable” declines in daily use in Italy and Spain in late February, Spotify said there was little overall impact to its subscriber and user numbers, and that music consumption had mostly recovered by the end of March.

Total users, which include those who do not pay for Spotify, rose to 286m, just below Wall Street forecasts for 287m.

Spotify runs advertisements on its free service, but advertising only makes up about one tenth of its revenues. The company said that its advertising revenues during the final three weeks of March were more than 20 per cent lower than it had previously forecast. “We are fortunate that as a business we are able to operate with very little disruption,” said Spotify.

The company, which hands out most of its revenues in royalty payments to the music industry, reported an operating loss of €17m in the quarter on €1.85bn in revenues.

Spain lays foundation for full reopening of economy by end of June

Daniel Dombey in Madrid

Spain is preparing to take the first steps towards phasing out its coronavirus lockdown, a process the government hopes will be completed by the end of June.

On Wednesday, as the health ministry reported figures that continued to show a relatively low level of deaths and infections, authorities in Madrid said that a huge temporary hospital in the city’s main conference space would close this week. The industry ministry said that it was seeking gradually to reactivate tourism but that a return to international travel would require EU-wide agreement on common procedures for transport.

The health ministry said 325 people had died in the past 24 hours after contracting coronavirus, an uptick on the previous day’s tally of 301, but one the ministry said was partly because of regional data coming in late. To date, the official coronavirus death toll is 24,275 people, the third highest in the world.

Such figures refer to proven rather than probable deaths. In an indication that the true number is considerably higher, the Madrid regional government said that since the start of the crisis, 5,811 people had died in the region’s care homes after contracting coronavirus, but only 1,130 were “confirmed cases” and thereby added to the national tally. The remaining 4,681 people displayed symptoms of Covid-19 before dying but were not tested.

The incidence of coronavirus, together with available hospital beds, and the preventive measures taken, will be key factors in determining Spain’s province-by-province transition out of the lockdown. The government hopes the process will be completed in as little as eight weeks and no longer than 10 weeks. During the transition, nationwide travel will still be banned and people will have to remain in their home provinces, despite the gradual reopening of restaurants, hotels and public places.

Libor transition delayed by Covid-19 ‘challenges’

Matthew Vincent in London

Regulators have announced a delay in the transition away from the tainted Libor lending benchmark, citing “challenges presented by the current operating environment” as Covid-19 lockdowns continue.

The UK’s Financial Conduct Authority and Bank of England said that the cut-off date for new loans referencing sterling Libor has been pushed back to the first quarter of 2021, from the third quarter of 2020 previously. However, the overall end date for the publication and use of Libor – December 31 2021 – remains in place.

In a joint statement with the Risk-Free Rate Working Group – comprising banks, broker-dealers and asset managers – the regulators said:

There will likely be continued use of Libor-referencing loan products into Q4 2020 in particular, to maintain the smooth flow of credit to the real economy.

Libor is being phased out following a series of scandals that damaged trust in the benchmark lending rate, which underpins roughly $400tn of products globally. In recent years, banks and brokers have had to pay nearly $10bn in penalties for trying to manipulate the rate, and Libor’s reliability has been further questioned given the diminishing number of transactions it is based on.

Maritime industries battle to cope with coronavirus restrictions

Sailors and ship guards face testing times due to the outbreak of the novel coronavirus, as basic necessities struggle to reach vessels and seaborne security risks rise while private security contractors deal with more onerous operating conditions.

“I am stuck on board and frankly speaking it seems the world has forgotten about us,” said a sailor working for the Evergreen Group, a Taiwanese shipping conglomerate, who wished to remain anonymous. “We are not allowed to go ashore – it has already been three months – and even the basic necessities such as toothpaste, chocolate and so on are difficult to get”.

The employee said that a third less cargo is being transported than usual, while the only port allowing crews to embark and disembark at present is Hong Kong. About 100,000 sailors typically change over each month. Evergreen Marine did not respond to the request for comment.

Boarding restrictions due to coronavirus and the deployment of tankers as floating crude storage, meanwhile, have created new problems for the maritime security industry.

Dimitris Maniatis, chief commercial officer at Diaplous, one of the largest maritime security providers, said that his company has deployed additional floating armories since guards could not board from certain ports and it bought 2,700 rapid testing kits.

“There’s a lot of business. We did crazy numbers in March and April”, he said. “It’s because the smaller, private maritime security companies couldn’t keep up with the new situation”.

Worries about the spread of coronavirus have made it harder for ships to keep up their guard, as seaborne oil and product storage undergoes rapid growth. A container ship near Benin was seized by pirates earlier this month, after the government suspended the deployment of its security forces on merchant vessels out of fear of them catching the virus from crews, Mr Maniatis said.

GE hit by knock-on from global aviation crisis

Industrial conglomerate General Electric reported a sharp slowdown in orders in its aviation business during the first quarter of the year as the global clampdown on air travel took its toll.

The group’s aviation division – which makes engines and other aircraft parts – saw orders slide 14 per cent to $7.5bn in the three months to the end of March, compared to the previous year. The global aviation industry is in the midst of an unprecedented crisis as government efforts to stem the spread of coronavirus have triggered a collapse in demand.

Lawrence Culp, GE chairman and chief executive, said:

The impact from Covid-19 materially challenged our first-quarter results, especially in Aviation, where we saw a dramatic decline in commercial aerospace as the virus spread globally in March.

Profits in the aviation segment fell 39 per cent to just over $1bn. The group’s healthcare division fared better, however, with profits rising 15 per cent to $896m on the back of a surge in orders for products used to diagnose and treat Covid-19.

For the business as a whole, industrial free cash flow – a key measure, which Mr Culp has focused on rebuilding – slid 81 per cent to minus $2.2bn, worse than the minus $2bn figure anticipated by analysts polled by Factset. Total revenues of $20.5bn were down 8 per cent on last year but broadly in line with expectations.

Adjusted earnings per share were $0.05 for the quarter, compared to $0.13 last year and just shy of the $0.08 anticipated by analysts. The company pulled its full year guidance earlier this month.

Mr Culp sought to paint a more positive picture for the period ahead, saying that while the virus poses “many unknowns” in the immediate future, the company would rebound. “There will be another side—planes will fly again, healthcare will normalise and modernise, and the world still needs more efficient, resilient energy”.

Good morning Americas: Here’s a round-up of Europe’s morning

Bosch, Europe’s largest auto supplier, warns of a ‘significantly steeper’ recession for the auto industry than in the financial crisis more than a decade ago.

The threat of negative US oil prices is still present as traders look to offload crude contracts for June delivery, say UBS analysts. Myles McCormick and Harry Dempsey in London

The UK sets up a new clinical trial initiative to fast-track potential treatments for Covid-19 patients, with six drugs initially put into the programme. Clive Cookson in London

Europe takes a hit: Business and consumer confidence has been crushed, with the European Commission figures revealing a plummet in April at a record rate. Spain’s retail sales dropped at a record pace in March. In the UK, meanwhile, industrial production is running just above half of its capacity while sentiment in the services sector has dropped to an all-time low in April as businesses shut down. Martin Arnold in Frankfurt and Valentina Romei in London report

Easing the lockdown: Poland cautiously sets dates in May for shopping centres, museums, hotels and pre-schools to re-open. Beijing loosens border controls for most domestic travellers. James Shotter in Warsaw and Yuan Yang in Beijing report

Baby boy for Johnson household: Boris Johnson, the UK prime minister, and his fiancée Carrie Symonds have given birth to a healthy baby boy in a London hospital.

Polish pre-schools, shopping centres and hotels to re-open in May

James Shotter in Warsaw

Poland is to re-open shopping centres and hotels from May 4, and allow pre-schools and kindergartens to open their doors from May 6, as the central European nation eases the restrictions put in place to fight the effects of the coronavirus pandemic.

The measures include a partial reopening of museums and libraries from May 4. But they could be reversed if signs appear that the epidemic, which has infected 12,415 and killed 606 Poles, was getting out of control, the prime minister said on Wednesday.

“We can see what is happening in Spain, Italy and France, and also in Belgium and Holland, where the number of people infected per million inhabitants is several times higher than in Poland,” Mateusz Morawiecki said.

“This is in a certain sense a warning for us to adjust our system of loosening restrictions to the preparedness of our health service, and the extent to which we have managed to get coronavirus under control.”

The move follows parks and forests being re-opened two weeks ago. Poland has also loosened restrictions on the number of people who can be in shops at any one time.

Business and consumer confidence crushed in Europe

Martin Arnold in Frankfurt

European business and consumer confidence plummeted at a record rate in April due to the coronavirus crisis, according to the EU’s main economic indicator, which fell close to the all-time lows of the financial crash a decade ago.

After recording “an exceptionally strong fall in confidence among consumers and in all the business sectors” the European Commission said its economic sentiment indicator fell by 28.8 points to 65.8 in the EU.

The fall was likely to have been even more severe as the survey could not be carried out in Italy, which imposed a severe lockdown on its inhabitants after suffering the heaviest death toll caused by coronavirus.

Among the largest eurozone economies, the sentiment indicator fell the most in the Netherlands, where it was down 32.6 per cent, while Spain’s dropped 26 per cent, Germany was down 19.9 per cent and France declined 16.3 per cent.

The EU warned “in many countries the response rate was lower this month than usual,” adding that the results of the survey “may be less accurate and comparable across countries than usual”.

Confidence among companies in the services sector fell by 32.7 per cent to its lowest ever level. Confidence in the industrial sector was down by a record 19.2 per cent, but remained above all-time lows seen in 2009.

Industrial activity at half capacity as confidence falls to record low

Valentina Romei in London

UK industrial production is running just above half of its capacity while sentiment in the services sector has dropped to an all-time low in April as businesses shut down in an attempt to limit the spread of coronavirus.

The economic sentiment indicator for services dropped to minus 58.8 in April, from minus 9.3 in March and the lowest since records began in 1997, according to data from the European Commission.

According to the survey, 70 per cent of businesses in the services sector, excluding retail, are struggling with insufficient demand.

The fall in sentiment was the most pronounced in the services sector – which accounts for roughly 80 per cent of the economy—but was widespread across all sectors and consumers.

The index for manufacturing dropped to minus 45.3 in April, the lowest since the financial crisis. The retail sector also reported a sharp deterioration, coupled with falling consumer confidence.

According to the survey, the manufacturing sector is running at 57.7 per cent of its capacity, down from an average of more than 80 per cent last year. The current order-books cover 3.4 months of production, down from an average of more than 4 in the last three years.

Despite a large government package to support job retention, the services employment index dropped to minus 48.3 in April, a figure which is just shy of the minus 49 seen during the financial crisis and a near record-low since records began in 1985.

UK establishes new clinical trial initiative for Covid-19 treatments

Clive Cookson in London

The UK has set up a new clinical trial initiative to fast-track potential treatments for Covid-19 into patients. Six drugs will initially enter the programme, called Accord (Accelerating COVID-19 Research & Development).

The first is bemcentinib from BerGenBio, a Norwegian biotech company. It will begin testing this week in 120 Covid-19 patients in six NHS hospitals. Half will receive the drug, which was developed as a cancer treatment but has shown antiviral activity in preclinical tests, while the other half form a control group receiving standard care.

The next two drugs will be MEDI3506 and acalabrutinib, both from AstraZeneca of the UK.

Drugs that do well in Accord trial will move on to larger studies such as the Recovery trial that has already recruited 8,000 participants.

Threat of negative US oil prices still present, say UBS analysts

Myles McCormick and Harry Dempsey in London

The possibility of benchmark US oil prices returning to sub-zero levels next month cannot be ruled out as traders look to offload crude contracts for June delivery, according to analysts at Swiss investment bank UBS.

The West Texas Intermediate May contract last week plunged to lows of minus $40 a barrel, with investors effectively paying to have oil taken off their hands. The unprecedented drop came as the coronavirus pandemic triggers a collapse in demand while production levels remain robust, leading to a shortage in storage capacity.

“I cannot exclude that we will get again into negative territory,” said Giovanni Stanuovo, UBS commodities analyst, speaking on a media call.

He said that there had been “lessons learned” from the last-minute scramble to offload May contracts. But growing pressure on storage facilities coupled with a significant amount of investors still exposed to June contracts meant a repeat of last week’s unprecedented drop remained a possibility.

Mr Staunovo said that investors should be cautious about rushing to buy oil futures contracts – even those with a later delivery date – since storage costs could be high, while prices remain depressed.

Time is not your friend at the moment. If the price doesn’t rise, you lose every month a significant amount of investment.

Beijing loosens border controls for most domestic travellers

Yuan Yang in Beijing

Beijing has ended its mandatory quarantine period of 14 days for those coming into the city from low-risk areas, meaning travellers can pass freely into the capital from most of China apart from Wuhan.

Beijing’s municipal deputy secretary Chen Bei made the remarks to state media on Thursday, the same day the government announced it would hold its annual “Two Sessions” parliamentary meetings starting May 21. The two moves suggest the local government of Beijing, previously China’s most tightly protected city during the epidemic, is confident in stemming new coronavirus cases.

Mr Chen emphasised that other current protective measures would remain in place, such as the need to prove identity when entering residential compounds. Over the past week, the city government has also made its newly developed “Health Kit” app a must-have for entering public spaces such as shopping malls, replacing the patchwork of different apps on offer before.


UK prime minister welcomes birth of baby boy

Laura Hughes in London

Boris Johnson and his fiancée Carrie Symonds have announced the arrival of a baby boy, just a day after the prime minister returned to the helm of government to work on the UK’s coronavirus strategy.

On Tuesday, Downing Street refused to say if the prime minister would be participating in Prime Minister’s Questions on Wednesday. The reason for his absence is now clear.

A spokesman for the couple said: “The prime minister and Ms Symonds are thrilled to announce the birth of a healthy baby boy at a London hospital earlier this morning. Both mother and baby are doing very well.

“The PM and Ms Symonds would like to thank the fantastic NHS maternity team.”

Sir Lindsay Hoyle, Speaker of the House of Commons, said:

On behalf of everyone in the House of Commons, may I say congratulations to the Prime Minister and Carrie Symonds on the birth of their son. Such happy news amid so much uncertainty – 2020 is certainly a year they will never forget.

Bosch warns of ‘significantly steeper’ recession for auto industry

Bosch, Europe’s largest auto supplier, has warned of a “significantly steeper” recession for the sector than during the financial crisis more than a decade ago, in one of the starkest forecasts from within the industry since the start of the Covid-19 outbreak.

The German supplier is expecting at least a 20 per cent decrease in automotive production in 2020, its chief financial officer said on Tuesday. Its business contracted by 1.5 per cent in 2009.

Chief executive Volkmar Denner, speaking to reporters, cautioned against “knee-jerk” policy reactions to the coronavirus pandemic, including a roll-back of globalisation.

“Across-the-board isolationism of the kind demanded by certain populist politicians cannot be the solution,” he said, while predicting that the economic turmoil caused by prolonged lockdowns could lead to social unrest.

New tariffs on international trade cost the company, which ships 300m parts per day, almost €100m in 2019, Mr Denner added.

France tightens controls on foreign investment

Victor Mallet in Paris

France will tighten controls on foreign investment to protect companies hit by the economic impact of the coronavirus pandemic, reducing the threshold for foreign holdings subject to restrictions from 25 per cent of a business to 10 per cent until the end of the year.

“In this crisis period, certain businesses are vulnerable,” finance minister Bruno Le Maire told LCI television. “Technologies are exposed and could be bought at low prices by foreign competitors and I won’t let that happen,” he said.

The restrictions, which apply to non-European purchases of stakes in large companies in strategic sectors, will be broadened to include biotech groups.

France had already broadened the reach of the rules and lowered the shareholding threshold from one third to 25 per cent at the start of the year. Investors must submit their plans to the government and reveal any links to a foreign government. The rules were tightened partly to deter unwanted Chinese acquisitions of French tech companies.

French companies have been hard hit by the Covid-19 pandemic and the lockdown in France since March 17. Some 890,000 businesses are paying 11.3m temporarily laid off employees – more than half the private sector workforce – with the help of a €24bn government “partial unemployment” scheme.

Global deaths pass 200,000

Steve Bernard, Senior Data Journalist

The worldwide death toll rose by 6,365 on Tuesday, pushing the total through 200,000.

The total number of confirmed cases broke through 3m, as a further 76,652 people were diagnosed with the Covid-19 virus.

The US added 24,458 cases as its total confirmed cases passed 1m. A further 2,198 people lost their lives bringing the total to 52,466, according to data from the Covid Tracking Project.

Brazil is firmly in the acceleration phase as it saw a jump in the number of deaths on Tuesday of 520, bringing the death toll to 5,083. Ecuador is the next hardest hit country in the region with 871 deaths recorded.

The number of global recovered cases rose by 31,989 yesterday, leaving a total of 953,309 free from the virus.

Russia reports record deaths of over 100

Henry Foy in Moscow

Russia reported a new record daily death toll from coronavirus on Wednesday, as total infections rose to almost 100,000 people.

Moscow said 105 people died overnight from Covid-19, a sharp increase in deaths that takes the total killed to 972. The country recorded 5,841 new coronavirus cases on Wednesday, meaning 99,399 people have been infected.

While the growth in cases has slowed in percentage terms over the past week, Russia has overtaken China and Iran to become the world’s eighth most affected country.

President Vladimir Putin on Tuesday extended a national lockdown until May 11 and said the worst was likely still to come, warning “a hard and difficult path lies ahead”.

Germany’s Covid-19 outbreak shows further signs of slowing

Guy Chazan

Germany reported 1,304 new coronavirus cases on Wednesday, well below the peak of the outbreak in the early days of April.

According to official data from the Robert Koch Institute in Berlin, the number of people who died of Covid-19 over the past 24 hours rose by 202 to 6,115. The total number of detected infections increased to 157,641, though 120,400 of them have already made a full recovery.

The latest figures offer fresh evidence that German health authorities have succeeded in slowing the spread of the virus – though the daily increase in confirmed infections saw a slight uptick.

Iran lifts restrictions to trade ‘justice shares’ to ease economic woes

Najmeh Bozorgmehr in Tehran

After about one decade of giving “justice shares” in top state-owned companies to around 50m Iranians, the Islamic republic decided to start lifting restrictions on the stocks and accrued dividends as of Wednesday in a bid to ease economic pressure on people.

“These shares have come to people’s help at this time of economic hardships,” president Hassan Rouhani said in a cabinet meeting which was broadcast live on the state television. “These shares belong to companies which are profitable.”

Iran says millions of jobs have been at risk because of Covid-19 which analysts say has fueled extreme poverty in particular amongst those who rely on daily wages. Iran’s economy is also struggling with the US sanctions.

It was not immediately clear how much the value of justice shares are in total but Mr Rouhani said each shareholder’s stocks were worth up to 10m rials ($62 at the open market rate) and that around 5m rials in some dividends were already paid in cash in previous years.

The move comes at a time Tehran Stock Exchange is performing well — with more than 200 per cent growth of its main index over the past year — that has attracted many retail investors to the market.

Bourse officials warned this week against a bubble burst. But the government of Mr Rouhani has rejected any major risks and has announced that it will accelerate the privatization programme through the capital market.

Italian bond yields rise after downgrade

The Italian government’s borrowing costs rose after Fitch downgraded the country’s credit rating to a single notch above “junk” in an unscheduled update.

“The downgrade reflects the significant impact of the global Covid-19 pandemic on Italy’s economy and the sovereign’s fiscal position,” Fitch said in a statement on Tuesday evening.

Italy’s benchmark 10-year bond yield rose 0.07 percentage points to 1.805 per cent.
The premium investors demand to hold Italian debt over Germany’s widened, as the spread between Italian 10-year government bonds and German Bunds of the same maturity rose to 2.29 percentage points.

Spanish retail market hit by record decline due to coronavirus closures

Valentina Romei in London

Spain’s retail sales dropped at a record pace in March, providing the first economic data on the impact of the closure of non-essential shops and businesses in the nation due to coronavirus.

The volume of retail sales dropped by 15.3 per cent in March compared to the same month last year, marking the largest drop since records began in 2001, according to data from Spain’s national statistics office.

This is the first economic data covering the retail sector during the coronavirus period in Spain. Previous indicators measuring sentiment have pointed to a large fall in economic activity in manufacturing and services but did not cover the retail sector.

Spain is expected to be one of the hardest-hit major world economies, according to data from the IMF, as a result of its higher reliance on tourism and its stringent lockdown measures.

Spain’s retail sales fell at a record pace despite an 8.4 per cent rise in food spending, as purchases of non-food items dropped by 32 per cent. The statistics office also reported a drop in employment for the retail sector which was steepest in smaller shops.

What you may have missed

Australia’s government said it would press ahead with its diplomatic push for an inquiry into the origins of the coronavirus despite a furious reaction from Beijing, which has accused Canberra of teaming up with Washington to mount “a political campaign” against China.

European countries which have begun to ease their coronavirus lockdowns are experiencing a tentative uptick in some forms of economic activity, early data suggest, although the movement of people and goods across the continent remains largely depressed.

Brazil’s supreme court has authorised a police investigation into President Jair Bolsonaro, heightening tensions and raising the prospect of further political turbulence in Latin America’s largest democracy.

Donald Trump has issued an executive order to force meat-processing factories to remain open, as concerns mount about the US food supply chain after the closure of several big plants because of Covid-19 outbreaks.

Standard Chartered’s pre-tax profits fell in the first quarter as the emerging markets-focused bank increased its expected loan losses by more than 1,000 per cent due to the economic impact of coronavirus. However, it pointed to “encouraging early signs” of a recovery in China.

Airbus’s chief executive said the coronavirus pandemic had led to the “gravest crisis” the industry has known as the aircraft manufacturer reported a net loss in the first quarter.

Samsung Electronics warned of a larger hit to its earnings from the coronavirus pandemic in the coming months, as the crisis pummels global demand for electronic devices.

Hiscox ponders raising equity ahead of price rises

Oliver Ralph in London

UK listed insurer Hiscox is considering raising fresh equity to allow it to take advantage of an expected rise in wholesale prices due to the coronavirus crisis.

Hiscox said on Wednesday that while it had enough capital to meet claims payments, it wanted to make sure it had enough in reserve to take advantage of potential price rises in US wholesale and reinsurance markets. The company, which has already cancelled its dividend, did not say how much it was thinking of raising.

Hiscox has been at the centre of a controversy around the non-payment of claims on UK business interruption policies. The company says that coronavirus claims are not covered by its policies, but a vocal action group has appointed lawyers and secured litigation funding to take Hiscox on.

Last week Hiscox said that it expected to pay a total of $150m in claims arising from the Covid-19 outbreak. But according to analysts at Morgan Stanley, business interruption claims – if successful – could cost the company between $19m and $121m per month.

Singapore reports sharpest quarterly drop in employment since Sars

Stefania Palma in Singapore

Singapore has reported the sharpest quarterly drop in employment since the Sars virus outbreak of 2003 as the city state faces an economic recession caused by fallout from coronavirus.

The manpower ministry said preliminary estimates showed the pandemic’s “early impact” on jobs, adding labour market conditions were likely to worsen in the upcoming quarter, given the sharp fall in demand globally as well as in Singapore where companies were having to adjust to the city state’s near total lockdown.

Total employment, excluding foreign domestic workers, in the first quarter of 2020 fell by 19,900, marking the largest quarterly drop since the second quarter of 2003, when total employment decreased by 24,000, the manpower ministry said.

It attributed the contraction — which hit the services sector the hardest, as well as manufacturing and construction — to a “significant reduction in foreign employment”.

Unemployment rates also rose quarter on quarter from 2.3 per cent to 2.4 per cent as of March, but remained lower than the level reached during the Sars epidemic in 2003 when unemployment rose to 4.8 per cent and the global financial crisis in 2009 when unemployment touched 3.3 per cent. The healthier employment figures this time could be due to relief schemes Singapore has rolled out in response to the outbreak, the ministry said.

Next says sales drop ‘faster and steeper’ than it feared a month ago

Patricia Nilsson

Next has said a coronavirus-induced tumble in sales has been “faster and steeper” than it had anticipated just a month earlier as the pandemic wreaks havoc on the UK retail sector.

Sales of full-price clothing in shops plummeted 52 per cent between January 26 and April 25, with online sales down by close to a third, Next said on Wednesday.

FTSE 100 retailer Next warned that the aftermath of the pandemic will be felt for “longer than first anticipated” with retailers facing lower sales “even after full lockdown measures have been lifted”.

Even in the best-case scenario, Next is now bracing for a 30 per cent drop in full-price clothing sales this year. The fall would be 10 percentage points deeper in the worst-case scenario the group modelled in a “stress test”.

The company said the modelling was not official guidance, saying “a pandemic of this scale has simply not been experienced by a modern global economy. No amount of information about the past can accurately guide us in our deliberations on the future”.

Next, which employs more than 40,000 people, reopened its online business two weeks ago in a “very limited” capacity, after it had halted its web operations to protect warehouse workers during the coronavirus pandemic. It has previously warned of a £1bn hit to revenues because of coronavirus.

Corporate news round-up

Retailer Next said that the fall off in sales since the lockdown has been “faster and steeper” than anticipated in its March stress test and the company is now modelling lower sales for the second half of the year. The maximum decline in its previous stress test was 25 per cent.

Barclays reported that bad loan provisions surged to £2.1bn in the first quarter, almost fivefold of £448m in the same period last year and far exceeding analyst expectations of £923m, as lockdowns across the world threaten to push swaths of its clients into default.

Housebuilder Persimmon said that there was a good level of customer enquiries through the lockdown period, an encouraging sign that demand for new houses will be resilient. Its builders will return to sites this week, after the government was clear that it wanted construction companies to restart building operations.

Dixons Carphone, an electronics retailer, reported that online sales recovered two-thirds of sales lost from bricks-and-mortar stores and that it had secured a further £266m revolving credit facility, although it decided not to pay a full-year dividend.

Trainline, the transportation ticket sales platform, said that its lenders have waived the debt covenants for its £350m revolving credit facility until August 2021.

DWS, the asset management arm of Deutsche Bank, has held its €1.67 per share dividend unchanged, after it reported that adjusted pre-tax profits were down by a third and investors pulled €6.1bn from long-term funds in the first quarter, relative to the previous quarter.

AstraZeneca said that revenues rose to $6.4bn in the first quarter, up 16 per cent on the previous year, while noting the outlook is “highly uncertain” due to coronavirus. The company is testing Calquence, a drug used to treat leukaemia, in a Phase II trial to suppress inflammation of the lungs and other organs experienced by some Covid-19 patients.

WPP, the world’s largest advertising company, said like-for-like sales dropped 7.9 per cent in March, prompting it to cut more costs, as clients hold back spending on advertising.

Finnair looks to raise €500m in rights issue

Richard Milne in Oslo

Finnair is planning a €500m rights issue to prop up its balance sheet due to the dramatic effect of coronavirus on the airline industry.

The Finnish government, which owns 56 per cent of Finnair, supports the plan, the flag carrier said on Wednesday.

Chief executive Topi Manner said:

The coronavirus has had an unprecedented impact especially on global aviation and also on Finnair. We want to ensure with this share issue that Finnair is a competitive airline also in the future by significantly strengthening the equity.

The news came as Finnair said it hoped a recovery in air traffic would start in July, far earlier than regional rivals Norwegian and SAS who think it will take place in 2021 with a return to normal only in 2022.

Finnair said it could not judge the pace of the recovery yet so had no outlook for the second half of the year. It repeated its warning that it would suffer a significant fall in revenues and a large loss this year as it faces what Mr Manner called the worst crisis “in the entire 100-year history of commercial aviation”.


Barclays hit by large jump in provisions for soured loans

Stephen Morris

Barclays became the latest European bank to post a vast increase in loan provisions, as the global lockdown to slow the spread of coronavirus threatens to push swaths of its clients into default.

First-quarter credit impairment charges surged almost fivefold to £2.1bn from the same period last year, far exceeding the £923m analysts had forecast, the London-based bank said on Wednesday. 

The charge pushed down net profit 42 per cent to £605m in the period, compared with expectations for £810m. The Covid-19 blow was partially offset by a 77 per cent rise in trading revenues — the “best-ever quarter” since 2014 — as the investment bank benefited from high volumes in turbulent markets.

The stress was particularly acute at Barclaycard — the credit card business that operates in the UK, US and Germany — which accounted for £885m of the virus-related loan-loss reserves. Similarly, the consumer arm, Barclays UK, saw net profit plunge 60 per cent to £175m.

“The impact of Covid-19 came late in what was until that point a good quarter,” chief executive Jes Staley said in the announcement. “Given the uncertainty around the developing economic downturn and low interest rate environment, 2020 is expected to be challenging.”

Global stocks and crude oil rise

European stocks were on pace for a third day of gains on Wednesday, while oil prices rebounded on hopes that a glut in global crude markets may be easing.

Futures tied to the FTSE 100 and Dax each rose 0.3 per cent, following a positive session in Asia.

European equities have gained this week as some of the region’s major economies push ahead with plans to carefully reopen their economies following weeks of lockdown. Notably, the French government on Tuesday said its businesses would be allowed to reopen from May 11, with some exceptions.

In energy markets, US oil gauge West Texas Intermediate rose 12 per cent to $13.90 per barrel, while the less volatile Brent was up 3 per cent at $21 per barrel.

The recovery in oil prices followed a report from the American Petroleum Institute, an industry group, that US oil inventories increased by less than 10m barrels in the week ended April 24, less than forecast.

Analysts polled by Bloomberg forecast data due later on Wednesday from the US Energy Department will show US crude stocks increased 11.7m over that period, after a 15m barrel rise the previous week.

Online sales at Dixons Carphone help offset hit from store closures

Jonathan Eley in London

Dixons Carphone said its home electricals ecommerce operation has recouped two-thirds of the sales lost to stores closed in the UK, although it still does not intend to pay a dividend for the year to May.

Online sales grew 166 per cent in the UK in the five weeks to April 25, the group said in a trading update. In Greece, where stores are also closed, online sales grew almost sevenfold.

Stores in Scandinavia are still open, with the result that overall electricals sales fell by a relatively modest 3 per cent in the five-week period. That compares to 8 per cent growth in the 11 weeks to March 21, before the UK lockdown began.

Mobile phone sales are no longer disclosed on a same-store basis following the decision to close all 531 standalone Carphone Warehouse stores.

The group said it had secured additional lending facilities and would save money by not declaring a final dividend in respect of the year about to end. Senior management have also taken a 20 per cent pay cut and will receive no bonuses this year.

Airbus chief says coronavirus has caused ‘gravest crisis’

Airbus’s chief executive said the coronavirus pandemic had led to the “gravest crisis” the industry has known as the aircraft manufacturer reported a net loss in the first quarter.

Airbus reported a consolidated net loss of €481m, against a €40m profit for the same period a year earlier, and adjusted earnings before interest and taxes fell 49 per cent to €281m. Consolidated revenues slipped 15 per cent year on year to €10.6bn, reflecting 40 fewer aircraft delivered in the first quarter, the planemaker said.

“We saw a solid start to the year both commercially and industrially but we are quickly seeing the impact of the Covid-19 pandemic coming through in the numbers,” said chief executive Guillaume Faury. “We are now in the midst of the gravest crisis the aerospace industry has ever known.”

The manufacturer did not give new guidance because of what it described as “limited visibility”.

The global aviation industry has been particularly badly hit by the Covid-19 pandemic as travellers stay home and countries introduced strict entry restrictions, forcing airlines to ground fleets and delay or cancel orders of new aircraft.

The manufacturer reported negative cash flow of €8.03bn, which included a €3.6bn fine paid to regulators in France, the UK and the US over a bribery scheme.

This month Mr Faury told the workforce of 133,000 that the planemaker was “bleeding cash”, which threatened the existence of the company.

The manufacturer said this month it would cut aircraft production by a third, slashing production of the A320 single-aisle jet from 60 to 40 a month, reducing the output of A350s to six a month from 10 previously and produce just two A330 jets a month from expectations of 40 a year.

Standard Chartered ‘encouraged’ by China as profits exceed expectations

Primrose Riordan in Hong Kong

UK-based bank Standard Chartered said it was seeing “encouraging early signs” of a recovery in China as it posted pre-tax quarterly profits and operating income above analyst estimates.

Standard Chartered pre-tax profits dropped nearly 12 per cent in the first quarter on the same period last year to $1.2bn, but the figure was above company-compiled consensus estimates of $828m. Its operating income for the quarter also came in above analyst expectations at $4.3bn, compared with forecasts of $3.8bn, a 13 per cent rise on the same period the year before.

While the bank warned it was “not possible to reliably quantify” the impact of the virus on its future performance, it struck a more upbeat tone than its competitors and said it expected “a gradual recovery” from the pandemic and for the global economy to move out of recession in the later part of the year led by emerging markets.

“We are seeing encouraging early signs of that happening in China,” Standard Chartered said as it released the results.

The bank said its fall in profits was due to “substantially” higher expected losses on loans, driven by the economic pain brought on by the outbreak of the virus.

Standard Chartered increased its provisions for bad loans by over 1,100 per cent to $956m from $78m in the same quarter last year.

Oil prices rise as Asian stocks enter bull market

Hudson Lockett in Hong Kong

Oil prices rebounded and stocks across Asia entered a bull market on hopes that a glut in global crude markets caused by the coronavirus pandemic may be easing.

In Asia trading on Wednesday, West Texas Intermediate, the US crude oil benchmark, climbed more than 13.7 per cent to $14.03 after the American Petroleum Institute, an industry group, reported that oil inventories increased by less than 10m barrels in the week ended April 24. Analysts polled by Bloomberg had forecast a rise of 12m barrels.

The US oil benchmark has been rocked in recent weeks by a coronavirus-driven collapse in demand and a lack of storage in the key delivery hub of Cushing, Oklahoma.

Signs of optimism in oil markets bled over into global equities. Australia’s S&P/ASX 200 added 1 per cent, South Korea’s Kospi rose 0.6 per cent and Hong Kong’s Hang Seng was up 0.2 per cent. China’s CSI 300 index of Shanghai- and Shenzhen-listed stocks rose 0.4 per cent. Japan’s market is closed for a public holiday.

The gains pushed the widely followed MSCI Asia Pacific index 20 per cent up from its recent lows, meeting the technical definition of a bull market.

Blackstone snaps up 10% stake in Crown Resorts for $360m

Jamie Smyth in Sydney

Blackstone has swooped to buy a 10 per cent stake in Australian gaming company Crown Resorts for A$551m ($360m), taking advantage of financial stress in a sector exposed to the coronavirus crisis.

The US private equity giant purchased the stake in Crown from Melco Resorts and Entertainment, a Macau-based company controlled by Hong Kong magnate Lawrence Ho that temporarily shuttered its casinos in February in the Chinese territory due to travel and social distancing restrictions. Blackstone paid Melco A$8.15 per share for the 9.99 per cent stake, according to a statement from Crown.

The sale by Mr Ho, a former business partner of Crown’s biggest shareholder, James Packer, represents a rapid retreat by Melco from Australia. Melco bought a 10 per cent stake in Crown in May last year at a price of A$13 per share and signalled it would buy an additional 10 per cent stake later in the year. But in February it abandoned plans to extend its stake in Crown citing a need to deploy its capital on core assets due to the coronavirus crisis.

Melco has encountered regulatory hurdles in Australia, where the New South Wales state gambling and liquor authority began investigating whether Melco was a suitable partner for Crown and whether the transfer of shares had breached Crown’s licence conditions.

A provision in Crown’s licence for a new casino in Sydney bans the involvement of Stanley Ho, Mr Ho’s father, and some companies associated with the family.

Australia renews calls for inquiry into origins of coronavirus outbreak

Jamie Smyth in Sydney

Australia’s government said on Wednesday it would press ahead with its diplomatic push for an inquiry into the origins of the coronavirus despite a furious reaction from Beijing, which has accused Canberra of teaming up with Washington to mount “a political campaign” against China.

Scott Morrison, Australia’s prime minister, also flagged the need for the nation’s economy to become more self-sufficient following a warning delivered by Beijing’s ambassador in Canberra this week that Chinese consumers may start to boycott Australian products due to the deteriorating diplomatic relations between the nations.

Mr Morrison told reporters his government would continue to call for an independent inquiry, which was in Australia’s interests and that of the wider international community to ensure lessons could be learned from the Covid-19 outbreak.

He also defended his government’s call for a ban on wildlife ‘wet markets’, saying this was not targeted at China, as these marketplaces selling exotic animals existed in many nations, including Indonesia.

“This is a virus that has taken more than 200,000 lives across the world. It has shut down the global economy. The implications and impacts of this are extraordinary. Now it would seem entirely reasonable and sensible that the world would want to have an independent assessment of how all this occurred, so we can learn the lessons and prevent it from happening again,” said Mr Morrison.

Mr Morrison said Australia would support a European Union motion on wet markets, which is due to be debated at the World Health Organisation next month.

Asked about Australia’s economic dependency on China, the nation’s largest trading partner with A$200bn in two-way annual trade, he said Canberra should seek to have an economy that is as “self sufficient” and “competitive” as possible”.

Diplomatic relations between Canberra and Beijing have deteriorated sharply since 2017 when the conservative government passed a raft of foreign influence legislation in response to a scandal involving donations by a Chinese businessmen to an MP.

These have ratcheted up even further since Mr Morrison issued a call for independent inquiry into the origins of the coronavirus outbreak in Wuhan earlier this month.

Vale posts lower-than-expected profits and cuts production forecast

Andres Schipani in São Paulo

Vale, the world’s biggest iron ore producer, posted lower-than-expected profits on Tuesday due to a sharp depreciation of the Brazilian currency and stoppages at one of its most important mines and lowered its forecast production guidance due to coronavirus.

The Rio de Janeiro based-company reported net income of $239m, significantly higher than the $1.64bn loss reported in the same period last year. Adjusted Ebitda was $2.88bn in the first quarter of 2020, which was below a Refinitiv consensus forecast Ebitda of $3.18bn, but a jump from the $652 loss in the same quarter last year.

The company said earnings had been affected by the partial stoppage at Brucutu, its largest operation in Minas Gerais, as well as lower nickel and copper prices and a tumbling currency.

The real has fallen around 30 per cent since the beginning of the year driven by concerns about the government’s handling of the coronavirus pandemic and local political and economic factors.

Although Vale said it had been “weathering the Covid-19 outbreak with limited impact to its operations”, it announced it had already been forced to temporarily halt its operations in its Teluk Rubiah port terminal in Malaysia, to reduce the functioning of its Voisey’s Bay nickel mine in Canada for seven weeks, and to delay the retrofitting of its coal-processing plant in its Moatize facility in Mozambique.

The company explained that in view of considering “the uncertainties and potential impact” of the pandemic, it had slashed its full-year production guidance to 310m-330m tonnes, down from 340m-355m tonnes.

China’s parliament to open in May after a 2-month delay

Ryan McMorrow in Beijing

China’s annual legislative session will finally open on May 21, after a two-month delay brought about by the coronavirus outbreak that began in the central city of Wuhan.

The National People’s Congress and its sidekick, the Chinese People’s Political Consultative Conference, are traditionally held every year in the first two weeks of March, but the outbreak forced Beijing to delay the meetings for the first time since the Cultural Revolution.

Although it is heavily scripted and largely ceremonial, the “two sessions” is one of the few chances for more than 5,000 members of the Communist party rank and file to collectively voice their opinion to the leadership. It also involves large crowds of people — both delegates and journalists — gathering indoors in tight spaces.

The scheduling of the meeting indicates Beijing believes it has the coronavirus outbreak largely under control after a second wave of infections emerged in China’s northern Heilongjiang province and southern Guangdong.

The Chinese capital continues to adopt some of the country’s most strict restrictions, including widespread temperature checks, limited restaurant seating, and other social distancing measures that many hope will be eased after the politically important meeting comes to an end.

News you might have missed

From the US

The US Small Business Administration has given out more than $52bn of its new small business rescue funding, a sign that the programme is picking up speed after being beset by technical glitches on Monday.

Starbucks said it expects the financial hit from coronavirus to intensify in the current quarter in the latest sign corporate America is not expecting a recovery from the crisis any time soon.

Google’s growth slowed sharply in the first quarter as the coronavirus crisis ate into some of the most important categories of online advertising, according to figures released on Tuesday.

Ford expects to lose more than $5bn before interest and taxes in the second quarter as fewer vehicles are sold globally, said Tim Stone, chief financial officer.

President Donald Trump is preparing to order meat-processing plants to remain open, amid mounting concerns about the US food supply chain with a number of large plants closing as workers contracted coronavirus.

From Europe

France reported a further 367 coronavirus deaths in the past 24 hours, 313 in hospitals and 54 in old people’s homes and other care homes, as six weeks of confinement continued to restrict the spread of the epidemic.

British Airways is looking at cutting almost 30 per cent of its 42,000 workforce as its parent company IAG warned that a return to 2019 passenger levels will take several years.

From the rest of the world

The IMF has approved $3.4bn in emergency funding to Nigeria, Africa’s biggest economy, in what is the fund’s largest disbursement to assist a country on the continent to deal with the coronavirus pandemic.

Investor gloom over Mexico has deepened with 99 per cent of respondents in a market survey by Credit Suisse believing the government is not doing enough to protect the economy from coronavirus.

Virtual rate cut forces Nintendo gamers into riskier assets

Leo Lewis in Tokyo and Robin Wigglesworth in Oslo

Savers at the Bank of Nook are being driven to speculate on turnips and tarantulas, as the most popular video game of the coronavirus era mimics global central bankers by making steep cuts in interest rates.

The estimated 12m players of Nintendo’s cartoon fantasy Animal Crossing: New Horizons were informed last week about the move, in which the Bank of Nook slashed the interest paid on savings from around 0.5 per cent to just 0.05 per cent.

The abrupt policy shift, imposed by an obligatory software update on April 23, provoked fury that a once-solid stream of income had been reduced to a trickle with the stroke of a raccoon banker’s pen.

Read more here.

Samsung Electronics forecasts weaker Q2 earnings due to virus

Song Jung-a in Seoul

Samsung Electronics has forecast weaker earnings for the second quarter after a fall in first-quarter net profit and its expectation that the coronavirus pandemic will batter global demand for electronic devices.

Net profit at the South Korean tech giant fell 3.15 per cent year on year to Won4.9tn ($4bn) in the first three months of this year while sales rose 5.61 per cent to Won55.3tn. Operating profit increased 3.43 per cent to Won6.45tn.

“Looking ahead to the second quarter, the company expects the memory business to remain solid, but overall earnings are likely to decline from the previous quarter because Covid-19 will significantly impact demand for several of its core products,” the company said on Wednesday.

The world’s largest producer of computer chips, smartphones and electronics displays has also warned of uncertainties clouding its outlook in the second half of the year.

“The duration and impact of the pandemic remain unknown,” the company said.
Samsung expects memory-chip demand to remain “robust” for servers and PCs due to an increased number of people working from home, but it forecasts sales of smartphones and TVs will fall “significantly” as the pandemic leads to store and plant closures globally. It also expects earnings from OLED (organic light-emitting diode) screens to decline due to falling smartphone sales.

Operating profit at the semiconductor division fell from Won4.12tn a year earlier to Won 3.99tn while that in the mobile division increased from Won2.27tn to Won2.65tn. Operating losses at the display division narrowed from Won560bn to Won290bn.

Fitch Ratings on Monday affirmed the company’s credit rating at double A minus with a stable outlook while IC Insights on Wednesday forecast the memory chip market this year would be unchanged from 2019. The market researcher expects strong growth to return to the memory chip market in 2021 and 2022.

China slowdown puts Xi in political bind

Don Weinland in Beijing

When Xi Jinping became Chinese president in 2013, he inherited a decades-long goal to ensure the country had achieved widespread prosperity on the eve of the Communist party’s 100th anniversary next year.

Known as xiaokang shehui, a term often translated as “moderately prosperous society” and comparable to the western concept of middle class, the plan called for doubling gross domestic product from 2010 to 2020 and the eradication of extreme poverty.

But economists said the outbreak of coronavirus and the collapse of economic growth for the first time in decades had dashed the Communist party’s hopes of declaring victory by the end of this year. And for Mr Xi, the country’s most powerful leader since Mao Zedong, it could prove a politically embarrassing and damaging miss.

Read more here.

Asia-Pacific stocks nudge higher

Asia-Pacific stocks edged higher in early trading on Wednesday, following on from a choppy session on Wall Street as optimism over European countries easing lockdowns failed to sustain gains.

The Kospi in South Korea nudged up 0.2 per cent and Australia’s S&P/ASX 200 added 0.3 per cent.

Overnight on Wall Street, the S&P 500 closed 0.5 per cent lower after swinging between positive and negative territory as US stocks failed to maintain the optimism seen in Europe.

The European benchmark Stoxx 600 gained 1.5 per cent, while London’s FTSE 100 rose 1.9 per cent as France and Spain detailed plans to gradually ease their lockdowns.

US oil prices moved higher in early Asia trade on Wednesday, with West Texas Intermediate, the US crude benchmark, up 8.8 per cent at $13.42 a barrel. WTI crude has been rocked by extreme price swings over the past week as the Covid-19 pandemic slashes demand sparking concerns that unwanted supply will overwhelm storage capacity.

Brazil Covid-19 death toll climbs above 5,000, surpassing China

Andres Schipani in São Paulo

Brazil on Tuesday surpassed China in the number of deaths from coronavirus as a political crisis clouds the fight against the pandemic.

The health ministry of Latin America’s largest country has reported 5,017 fatalities — compared to China’s latest official tally of 4,633 — and 1,156 under investigation. There were 474 deaths in the last day alone.

The total number of coronavirus cases topped 71,886, with 5,385 new cases in the last 24 hours. The largest clusters for cases are in the states of São Paulo, Rio de Janeiro, Ceará, Pernambuco and Amazonas, where in its capital Manaus mass graves are reportedly being dug to bury lines of coffins.

Even as the number of cases rise, Brazil’s attention has shifted to a political crisis centred around President Jair Bolsonaro, who has repeatedly downplayed the pandemic as “hysteria” and Covid-19 as a “sniffle”.

On Monday, Brazil’s supreme court authorised a police investigation into the president over political interference in police work following shocking revelations from his former justice minister.

The crisis has split the country, with the latest poll showing that 49 per cent of respondents thought Mr Bolsonaro was unfit to run the country.

Questioned by reporters after the latest death toll was released on Tuesday night, Mr Bolsonaro replied: “So? Am sorry. What do you want me to do? I am Messiah, but I do not perform miracles,” he said, in a reference to Messias, which is his own middle name.

US may test airline passengers from Brazil for coronavirus

Demetri Sevastopulo in Washington

Donald Trump is considering requiring airline passengers from Brazil to be tested for coronavirus, amid concerns that travellers could exacerbate the pandemic in Florida, which has been less hit than other big US states.

Speaking after a meeting with Ron DeSantis, Florida’s Republican governor, Mr Trump said he was looking “very strongly” at whether he should require passengers from South America, including Brazil, to be tested for the virus.

“We’re looking at doing it on the international flights coming out of areas that are heavily infected … Brazil is getting to that category,” Mr Trump told reporters. “We’re looking at it very strongly.”

Sitting beside Mr Trump in the Oval Office earlier on Tuesday, Mr DeSantis said he was concerned about a possible influx of infected travellers from Brazil and that airlines should bear responsibility for testing all their passengers.

“Brazil and some of those places which have a lot interaction with Miami, you’re gonna probably see the epidemic increase there as their season changes. We could be way on the other side, doing well in Florida, and then you could just have people kind of come in,” Mr DeSantis said in an exchange before their private meeting.

Florida has just under 33,000 of the more than 1m confirmed cases of coronavirus in the US. The death toll in the state hit 1,171 on Tuesday, which was relatively low for a state of 21.4m people.

US death toll rises by 2,198

Matthew Rocco in New York

The number of deaths attributed to coronavirus in the US rose by 2,198 over the past 24 hours, as confirmed infections surpassed the 1m mark.

The US has completed nearly 5.8m tests with just over 1m of them positive, according to the latest data compiled by the Covid Tracking Project. A total of 52,525 people have died.

Coronavirus latest: UK warns discussing how to ease lockdown is ‘irresponsible’

News you might have missed

The number of coronavirus fatalities worldwide has surpassed 200,000, according the latest statistics from Johns Hopkins University. The rise comes after the UK reported a further 813 deaths today, becoming the fifth country to record more than 20,000. A total of 2,865,938 people have been infected by the virus. Around a third of the cases are based in the US.

The number of people who have died in UK hospitals as a result of coronavirus has surpassed 20,000, official figures have confirmed. A further 813 fatalities across the UK brought the total to 20,319 as of 5pm on Friday — making the UK the fifth country to pass 20,000 deaths after the US, Italy, Spain, and France, according to Johns Hopkins University.

Priti Patel, the UK home secretary, has drawn attention to efforts to combat crime during the lockdown. The home secretary said authorities were taking down websites attempting to carry out phishing scams, preventing the sale of bogus personal protective equipment and stopping drug smuggling. She said there had been a total of £2.4m in losses to fraudsters during the lockdown.

Spain plans to relax its six-week-old lockdown — one of the toughest in the world — by allowing people to walk and exercise outdoors from the start of next month. In a televised address on Saturday night, the prime minister, Pedro Sánchez, highlighted the country’s falling official death toll, which has been below 400 for each of the past two days, and the reduction in the spread of the virus.

France recorded another 369 deaths due to Covid-19 but has continued to experience a steady decline in the number of patients in hospital or in need of intensive care beds due to the virus. There have been a total of 22,614 deaths linked to coronavirus in France, with 14,050 occurring in hospitals, an increase of 198 over the past day.

The daily coronavirus death toll in Italy dropped to its lowest level since March 17, according to the latest official figures. Italy reported 415 deaths on Saturday – down from 919 at its peak on March 27. Fatalities totalled 26,384, the second highest after the US. The number of people infected fell by 680 to 105,847 as recoveries continued to outpace new cases.

Canada has granted fish and seafood processors C$62.5m (US$44.34m) to help safeguard the country’s food supply chain. Justin Trudeau, the prime minister, acknowledged that recent weeks had been “very difficult” for food suppliers as Covid-19 hit the workforce, and said that the government was “actively exploring” additional measures.

Embraer has hit back at Boeing after the US company walked away from a $4bn deal to acquire the Brazilian group’s regional jet business, saying it “wrongfully terminated” the agreement. In a statement, Embraer said Boeing had “manufactured false claims as a pretext to seek to avoid its commitments to close the transaction”.

Coronavirus latest: Jaguar Land Rover to restart some factories in May

Siemens Healthineers develops new potential coronavirus antibody test

Joe Miller in Frankfurt

Siemens Healthineers, the medical equipment subsidiary of Germany’s Siemens Group, has developed a Covid-19 antibody test which it claims can deliver a result in 14 minutes.

The Erlangen-based company said it would be able to produce more than 25m of the tests per month, starting in June, by utilising its manufacturing facility in Massachusetts.

“With a proven sensitivity and specificity of more than 99 percent, the test is expected to exceed strict FDA quality guidelines,” the company said.

The test will detect both IgM and IgG antibodies, it added. The antibody test is yet to receive regulatory approval but Siemens Healthineers is making applications to regulators in Europe and the US to approve it.

Hundreds of antibody tests have been developed since the outbreak of Covid-19, but authorities in China, the US and Europe have expressed concern about their accuracy. Earlier this week, researchers in Oxford found that nine prototypes being considered by the UK government performed inadequately.

Target’s sales surge fades as crisis drags on

Alistair Gray, US Consumer Correspondent

Target has warned its profitability is under pressure after an initial
sales surge ahead of the coronavirus lockdown faded, disappointing
investors who believe the big box US retailer will emerge as a winner
from the crisis.

While ecommerce revenues have jumped more than 275 per cent so far
this month, and demand for its groceries remains robust, the company
said like-for-like store sales had declined “in the mid-teens”
percentage range.

Shares dropped 5.7 per cent at the open in New York after Brian
Cornell, chief executive, said the crisis would put “near-term
pressure on our profitability”. Target put Wall Street on notice that
its first quarter operating margin would decline more than 5
percentage points.

Like its peer Walmart, Target stocks a wide range of goods, from
groceries and toiletries to clothing and electronics. Its mix of
convenience and product line-up have allowed it to avoid the troubles
that have afflicted other retailers.

Stockpiling initially boosted Target’s sales, but while sales have
since been strong online and in groceries, they have been weak in some
other categories.

In March, like-for-like food sales jumped about 40 percent, but they
declined by a “low single digit” percentage in homewares and more than
30 per cent in apparel and accessories.

Michael Fiddelke, chief financial officer, said that despite the
immediate pressures “we expect to have the financial capacity to
emerge from this crisis in a position of strength”.

UK testing capacity remains at only half of Downing Street target

Laura Hughes

Downing Street has said coronavirus testing capacity is now at 48,273, as ministers scramble to ramp up screening in the UK to meet their target of 100,000 a day by the end of April.

Although capacity continues to increase, the government is struggling to increase the numbers of those taking the tests, with just 22,814 carried out on 13,522 people in the 24 hours up to 9am on Wednesday.

The prime minister’s spokesman acknowledged there was a “great deal more to do” to make up the shortfall.

“The number of people we’ve tested has increased in the most recent 24 hours we’ve got figures for and the gap between the number of people tested and the number of people we’ve tested has closed slightly,” he said.

“But that doesn’t distract from the fact that there’s a great deal more to do if we’re to be able to say we’re making the full use of the capacity we have.”

Meanwhile No 10 said the government’s Sage scientific expert committee has “finalised their advice” on the wearing of face masks by the public.

“Ministers will now be reviewing this to decide on any further action that might be needed,” it said.

It added that Boris Johnson, who is still recovering from coronavirus, had spoken with the Queen.

“He spoke with the First Secretary of State [Dominic Raab] yesterday and he had an audience of Her Majesty the Queen by telephone last night,” it said.

Jaguar Land Rover to restart factories in mid-May

Peter Campbell in London

Jaguar Land Rover will restart production at plants in Solihull, Slovakia and Austria from May 18, becoming the first large-scale car producer in Britain to announce it will fire up its sites following the coronavirus shutdown.

The carmaker will produce limited numbers of its most lucrative models, such as Range Rover and Range Rover Sport, to be sold to buyers in China, who are returning to dealerships as the world’s largest car market comes out of lockdown.

JLR’s engine site at Wolverhampton will re-open at the same time, while its other assembly plants in Halewood and Castle Bromwich will remain closed until demand in Europe and North America recovers.

“In China, we are beginning to see recovery in vehicle sales and customers are returning to our showrooms,” the company said. “Our joint venture plant in Changshu has been in operation since the middle of February.”

The group’s Chinese plants already produce some of its lower-end models, such as Jaguar saloons and its smaller sports utility vehicles.

The most expensive cars sold in China are still made in the UK, or in its new factory in Slovakia.

From May 18, Solihull will run on a single shift producing Range Rover, Range Rover Sport, Range Rover Velar and Jaguar F-Pace. Slovakia will make the Land Rover Discovery and the new Land Rover Defender, while JLR’s contract manufacturing operation at Magna Steyr in Austria will begin making the Jaguar E-Pace and electric Jaguar I-Pace again.

Earlier on Thursday, Aston Martin announced it will restart production at its St Athan plant on May 4, as it prepares to begin deliveries of the new DBX sports utility vehicle.

Most UK parents fear for children’s wellbeing in lockdown, says survey

Valentina Romei in London

Most British parents think homeschooling is negatively affecting their children’s wellbeing while putting a strain on their jobs and relationships, according to an official survey.

The majority of the UK population are worried about the overall effect coronavirus is having on their life, according to the Opinions and Lifestyle survey by the Office for National Statistics taken between April 3 and 13.

While more than two-thirds of those polled believed their children were continuing to learn during the lockdown, most did not feel confident in their ability to provide adequate home schooling.

The majority of parents thought homeschooling was negatively affecting the wellbeing of children, while more than 40 per cent said it was putting a strain on their relationship and on their jobs.

The burden of home education has fallen disproportionately on women with more than 74 per cent of mothers taking charge of homeschooling, compared with 66 per cent of men, revealed the data.

Domino’s boosted by surge in US pizza deliveries

Alistair Gray, US Retail Correspondent

Americans under lockdown are ordering more Domino’s Pizza takeaways, boosting the company’s US business since movement restrictions took effect, but its sales overseas have declined.

The world’s largest pizza company by retail sales, whose shares are trading near all-time highs, released initial figures on Thursday showing like-for-like US sales leapt 7 per cent in the first four weeks of its second quarter, which began on March 23.

It marks an acceleration from the 1.6 per cent year-on-year US growth in the three months to March 22 for the company, which is focused on delivery and carryout franchises.

Outside the US, however, same store sales so far in the second quarter have dipped 3.2 per cent on a constant currency basis. Domino’s also withdrew its two-to-three-year outlook, citing uncertainty over the impact of Covid-19.


US job gains since financial crisis wiped out as millions file for unemployment

Mamta Badkar in New York

More than 4m Americans filed for first time unemployment benefits in the fifth week since nationwide lockdowns began, wiping out the job gains in the years following the 2008-09 financial crisis.

Initial jobless claims totalled 4.4m in the week ended April 18, the labour department said on Thursday, a decrease of 810,000 from the previous week. That compared with economists’ expectations for 4.5m.

The cumulative total since the lockdowns began in mid-March has now surpassed 26m, erasing the number of jobs created in the US since the financial crisis.

Switzerland faces sharpest economic contraction since 1974

Sam Jones in Zurich

Switzerland’s economy is on course to experience its most severe contraction since the 1974 oil price shock, according to the latest official forecast from the country’s finance ministry.

The State Secretariat for Economic Affairs said it expects the Swiss economy to contract by 6.7 per cent in 2020 – the more benign of two scenarios it has modelled.

A worst-case scenario – which for now has been ruled out – anticipated a 10 per cent decline, with a sluggish “L-shaped” recovery dragging out into 2021.

The small, wealthy alpine state – the seventh largest economy in Europe, with a nominal GDP of $715bn – is set to begin easing its lockdown measures against the coronavirus pandemic on Monday, when a range of small shops will be permitted to open again.

The country has been seen as an outlier in Europe for the speed and efficiency of economic stimulus it has put in place to safeguard businesses and livelihoods. A second phase of easing, when all shops will be permitted to resume trading, will occur on May 11.

Switzerland has also been one of the most effective western countries in managing the spread of the virus: on Thursday it reported just 94 new cases of Covid-19, the lowest daily increase since March 10.

US: what you might have missed

China will give the World Health Organization an additional $30m to support its efforts in combating the global coronavirus pandemic. Hua Chunying, the foreign ministry’s chief spokesperson, said the donation was in addition to $20m donated last month to the WHO’s coronavirus prevention efforts, according to Reuters.

Manufacturing and services activity in the UK has contracted at a rate “vastly exceeding that seen even during the global financial crisis,” as a large portion of the economy has been shut down due to the coronavirus pandemic.

PMI surveys also revealed the depth of the European downturn, as lockdowns stifle businesses from Paris to Frankfurt. French and German business activity fell to record lows, in readings that suggest the region faces a major economic downturn.

– The global death toll continued to slow, rising by 6,607 yesterday, down slightly from the day before. This represents a 4 per cent daily increase, far lower than the peak of 15 per cent in late March, according to data from Worldometers.

Greece is extending its lockdown until May 4 after which some small businesses will be allowed to reopen. The return to normality will be slow, the government said.

– The increase in documented coronavirus cases in Spain has settled at around 2 per cent a day, and the daily death toll at between 399 and 440, according to the latest government figures.

Lockdowns lower personal hygiene standards, says Unilever

First-quarter results from Unilever contained some interesting hints about how people’s habits are changing during lockdowns.

The Anglo-Dutch group — which makes household brands like Dove soap, Lynx and Sure deodorants and Toni & Guy haircare — said homeworking was leading to a decline in demand for products including razors, shampoo and deodorant. Cooking and household cleaning products were surging, the company said.

Read the full story from the FT’s Judith Evans

Ukraine’s central bank slashes its benchmark rate to shore up the economy

Roman Olearchyk in Kyiv

Ukraine’s central bank cut the country’s benchmark lending rate from 10 per cent to 8 per cent as expectations of a deep recession heighten due to the Covid-19 pandemic.

“This will give the economy stimulus in these difficult times,” said Yakiv Smolii, head of the National Bank of Ukraine.

The central bank’s seventh consecutive rate-cut cumulatively brings lending rates down by 9.5 per cent since last July. Ukraine’s economy has grown at around 3 per cent in the past four years, after a 16.4 per cent plunge in 2014-15 following Russia’s annexation of Crimea.

“The economy of Ukraine will contract by 5 per cent in 2020 in the wake of the quarantine imposed to overcome the pandemic and due to the global crisis. However, it will resume growth at round 4 per cent in the following years,” the central bank said in a statement.

“Fiscal and monetary policy measures that are aimed to support businesses and households will partially offset the decline in consumer demand,” the bank said. It added that it expected inflation to remain within the target range of 4-6 per cent.

Ukraine’s parliament is expected to adopt banking legislation in the coming weeks required to unlock an $8bn IMF loan and billions of dollars of additional financial assistance from the EU, the World Bank and other financial institutions.

Nissan starts production on aprons for the NHS

Chris Tighe in Newcastle

Nissan’s Sunderland auto plant will add plastic aprons to its output of protective equipment for NHS workers, as UK manufacturers rush to switch production to supply hard-pressed hospitals.

The UK’s biggest car-making site has started manufacturing non-sterile grade aprons made of tear resistant polythene. The plant plans to raise production from 18,000 aprons per week at present to 70,000. Local NHS trusts have ordered 47,000 aprons so far.

Nissan is already making up to 100,000 face-protection visors a week for NHS workers.

Invesco reduces dividend to strengthen against persistent outflows

Richard Henderson in New York

Invesco has reduced its dividend to fortify its balance sheet, taking the rare step to combat the coronavirus-driven drop in global markets, persistent outflows and the cost of a recent acquisition, which have weighed heavily on the US fund manager.

Atlanta-based Invesco dropped its quarterly dividend to $0.15 from $0.31, the first reduction since at least 2009, according to Bloomberg data. Companies are loath to reduce the dividends they pay shareholders, who use the sum as a sign of financial stability.

The company announced the dividend reduction in its quarterly earnings on Thursday. The group decreased its earnings per share by 40 per cent from a year ago to $0.34, falling far short of the $0.52 anticipated by analysts.

The group’s assets under management fell 14 per cent to $1.05tn after the coronavirus pandemic sent global markets tumbling in the quarter. A drop in assets reduces fund managers’ revenues because they charge fees as a proportion of the assets they oversee.

Scotland highlights ‘limited scope’ to ease lockdown restrictions

Mure Dickie reports from Edinburgh

The Scottish government does not identify “much scope” to ease social distancing restrictions, intended to prevent coronavirus infections, while loosening of controls will be cautious and could be reversed.

A framework document published by the Scottish government on Thursday set out principles for easing the coronavirus, including that any moves should be safe and evidence-based. It was also careful not to fuel public hopes for quick progress.

The government’s “best estimate” is that each person infected with Covid-19 is now infecting less than one other person, but that this has only been achieved with a wide range of restrictive policies.

“That does not leave us much scope to ease restrictions” it said.

If, after easing any restrictions, the evidence tells us we are unable to contain the transmission of the virus then we will have to re-impose them, possibly returning to lockdown with little notice.

Bank of England fights back against hyperinflation critics

Delphine Strauss in London

The Bank of England is not setting the UK on a path to hyperinflation through the exceptional measures it has taken to limit the economic impact of the coronavirus crisis, a senior policymaker asserted on Thursday.

In a speech delivered online, Gertjan Vlieghe, an external member of the BoE’s Monetary Policy Committee, defended the central bank against charges that its stimulus policies – ranging from rate cuts and fresh quantitative easing, to the direct financing of state spending – compromised its independence and could unleash Weimar Republic levels of hyperinflation.

Debating whether the BoE’s actions constituted monetary finance was “not useful”, he said. Central banks were always financing fiscal spending to some extent, he argued, but the government would eventually carry the cost.

“The MPC has decided to expand the Bank of England’s balance sheet, because we believe that if we do not, the economy will weaken further such that we would fall short of our inflation target,” Mr Vlieghe said.

The decision to allow the government to run a bigger overdraft with the central bank, to ensure it could meet its immediate cashflow needs, did not affect the MPC’s ability to hit its inflation target, he said, because it was a strictly short-term arrangement.

If we were the central bank of the Weimar Republic or Zimbabwe, the mechanical transactions on our balance sheet would be similar to what is actually happening in the UK right now. That is not where you would find the smoking gun. The difference would be that government would be telling the central bank what to do…in order to achieve fiscal objectives.

Mr Vlieghe also said in the speech that: “We are experiencing an economic contraction that is faster and deeper than anything we have seen in the past century, or possibly several centuries.”

Inside Wuhan: China’s struggle to control the virus — and the narrative

The city of Wuhan has gained international notoriety as ‘ground zero’ of the coronavirus pandemic that has swept across the world over recent months, infecting 2.5m people.

As the city’s 11m residents return to their day-to-day lives following a lengthy quarantine and 3,800 deaths, Don Weinland investigates what happened at the outset of the outbreak in the virus’s epicentre.

Read Don’s full magazine piece here

Greece to ease lockdown from May 4 as new Covid-19 cases decline

Kerin Hope in Athens

Greece is extending its lockdown until May 4 after which some small businesses will be allowed to reopen, a government spokesperson said on Thursday.

But he warned: “the return to normality will be slow and will happen step by step during May and June”.

“At each stage the impact on public health will be assessed. We’re going to take it week by week,” he added. A detailed timetable for restarting the economy will be announced next week.

Greece has seen a steady decline in new cases of coronavirus in the past two weeks, with the daily number falling to single digits over the past six days. The total number of cases stood at 2,408 on Wednesday.

Fears that social distancing and travel restrictions would be disrupted during last weekend’s Orthodox Easter holiday, the country’s biggest festivity, proved unfounded, with relatively few violations reported by police. As a result the government moved ahead on Monday with detailed planning to end the full lockdown imposed on March 16.

MPs demand roadmap for reopening economy as unease grows

Jim Pickard in London

Tory MPs are growing increasingly fearful about the economic consequences of the lockdown and urging Number 10 to produce a clear roadmap to reopening the economy – before thousands of companies go bust. The issue came to the fore at a meeting of the backbench “1922” committee on Wednesday evening.

On Thursday, Richard Fuller, a Tory member of the business select committee, told business secretary Alok Sharma that his answers about the road to economic recovery were too vague to reassure people.

The government shut down the economy after looking at the medical evidence but without having studied the full countervailing economic costs that would ensue, he claimed. Mr Sharma added that he had a daily dialogue with businesses and they appreciated the government’s difficult position.

Nusrat Ghani, another Tory member, said:

Many businesses feel that they are on the verge of bankruptcy…people talk about the economic and social impacts but they are both the same.

Anxiety about the lockdown is not confined to Tory MPs. One Labour politician said that he was uneasy about the “sense of religion, almost like a cult”, around the government’s focus on protecting the NHS.

There are so many other things going wrong, people unable to get cancer treatment, vulnerable children being abused at home, domestic violence, the economic car crash that is heading our way….I can’t say this in public but this can’t keep going much longer.

Angela Merkel warns against lifting lockdown too quickly

Guy Chazan in Berlin

Angela Merkel has warned that Germany risks “gambling away” its success in containing the spread of coronavirus if it moves too quickly to lift its lockdown measures.

Amid fears that people believe the worst of the crisis is over and that they can ease social distancing rules, Ms Merkel said on Thursday that the pandemic was only just beginning and that Germans needed to show endurance and discipline.

The federal government and leaders of the country’s 16 regions agreed last week that shops with retail space of up to 800 sq m could reopen from Monday, and that some children could start going back to school from May 4, with priority given to final-year students.

“It seems at times very quick, or even too quick,” she said in a speech to the Bundestag.

Read the full article here.

The Independent cuts staff pay by 20 per cent

Mark Di Stefano, Media and Technology reporter

The UK’s Independent will cut the pay of its journalists and staff, while some will be transferred to the government’s furlough scheme, blaming an “extreme” decline in digital advertising revenue brought on by the coronavirus outbreak.

The left-of-centre, digital-only outlet, part-owned by Russian-British proprietor Evgeny Lebedev, said all staff earning over £37,500 a year would have their pay cut by 20 per cent, while some would be placed on paid leave.

Independent chief executive Zach Leonard said the website had faced advertising declines between 30-50 per cent despite record traffic numbers, according to people on the call.

“We are seeing hundreds of thousands of pounds washing away,” Mr Leonard said.

The Independent was the first major UK outlet to turn off its printing presses, shifting to a mass-market, non-paywalled business model in 2016, which is heavily reliant on digital advertising revenue.

Spain’s coronavirus cases rise by 2% a day

Daniel Dombey in Madrid

The increase in documented coronavirus cases in Spain has settled at around 2 per cent a day, and the daily death toll at between 399 and 440, according to the latest government figures.

The ministry of health said on Thursday there had been 213,024 known cases as of 9pm the previous day – 2 per cent more than 24 hours before. This includes 34,355 medical professionals.

The death toll in the 24 hour period stood at 440, five more than the previous day, but broadly in line with the levels of 399 and above recorded throughout this week. This compares with death tolls of more than 500 each day last week and an April 2 peak of 950 deaths. According to the official figures, the accumulated death toll is 22,157 while 89,250 people have recovered.

Spain is planning to begin relaxing its almost six week long lockdown next month. As an anticipatory measure, from Sunday children will be able to go outside for an hour a day for accompanied walks, as long as they do not travel more than 1km from their homes. Initially, the government had planned to allow children out only to accompany adults on visits such as to the shops or the bank. But it backtracked after widespread criticism that it made little sense to encourage visits to enclosed spaces where the risk of contagion is higher.

UK coronavirus study to test 300,000 people for infection and immunity

Clive Cookson in London

The UK is to test 300,000 people over the next 12 months to discover levels of coronavirus infection and immunity in the population.

Twenty thousand households are already being contacted in the first wave of the study, which aims to cover a representative sample of people living in the UK by geography and age.

“Understanding more about the rate of Covid-19 infection in the general population, and the longer-term prevalence of antibodies, is a vital part of our ongoing response to this virus,” Matt Hancock, health secretary, said when announcing the study on Thursday morning. Together, these results will help us better understand the spread of the virus to date, predict the future trajectory and inform future action we take, including crucially the development of groundbreaking new tests and treatments.”

Read the full story here

Singapore traders scramble to reassure nervous clients

Neil Hume in London

Energy traders in Singapore are scrambling to reassure nervous clients that they have no exposure to crisis hit rival Hin Leong, and can survive the slump in demand caused by coronavirus lockdowns.

The downfall of Hin Leong, which has collapsed under debts of almost $4bn and admitted to $800m of undisclosed losses, has sent shockwaves through Singapore’s tight-knit trading community.

Winson Group urged clients to ignore rumours that it had “run into financial difficulties, declaring “financial position remains healthy and liquid.”

“We have been able to meet all our obligations with both our banks and suppliers,” it said in a letter, seen by the Financial Times. Winson added that it did not have “open account receivables” with Hin Leong or related companies.

Meanwhile, Zen-Rock Group told its customers that it had “ability and experience” to work “profitably” through challenges presented by Covid-19. “We assure you that we do not have any open account sale to Hin Leong and/or any of its associated or related entities,” it also said in a letter. “We also assure you that we are not under statutory restructuring /insolvency protection.”

However, banks have stopped providing finance for any oil cargoes that have not been sold, making life tough for traders.

Scotland faces budget challenge, warns watchdog

Mure Dickie in Edinburgh

Scotland’s independent fiscal watchdog has warned the Scottish government could struggle to balance its budget this year because of uncertainty created by the coronavirus crisis on spending needs and UK funding.

A report published on Thursday by the Scottish Fiscal Commission underlined the complexity of the devolved Scottish government’s budget process and the strains created by an “unprecedented combination of a supply-side shock, a demand-side shock and potentially a financial system shock”.

The Scottish government, which is required to broadly balance its budget and has limited borrowing powers, is expected to receive £3.5bn in extra funding to deal with the coronavirus crisis in 2020-21 as a result of increased spending by the UK government. But the SFC said it remained unclear how much money would be available or whether the epidemic would affect Scotland differently from the rest of the UK.

“With uncertainty about the level of funding received from the UK government as well as the level of spending required in Scotland, it may be difficult for the Scottish government to balance spending against available funding within the financial year,” the commission said.

Differences may be difficult to manage if the effects of Covid-19 and the policy responses are materially different between Scotland and the rest of the UK.

Belgium shows signs of passing the peak of virus

Jim Brunsden in Brussels

Fewer than 1,000 coronavirus patients are in intensive care in Belgium for the first time since March 29, in a sign of how the country may have passed the peak of the pandemic.

The overall number of people in hospital with Covid-19 is also steadily falling. The number of patients has been below 5,000 since April 18 and stood at 4,527 on Wednesday, according to the latest data presented by the Belgian government’s crisis centre. Of those, 993 were in intensive care.

“The number of new hospitalisations is stabilising and the peak in the number of [new] deaths seems to be behind us,” the Belgian health ministry said in a statement.

Belgium’s death toll of 6,490 is relatively high compared with many other European countries because the country includes deaths in care homes that are suspected, but not proven, to have been caused by Covid-19.

The health ministry said that 53 per cent of Belgium’s casualties died in care homes or rest homes. Of those, only 5 per cent were confirmed cases.

Analysis: UK will not struggle to find buyers for £225bn debt issuance

Tommy Stubbington in London

The UK government will borrow £180bn in just three months to fund its response to the coronavirus crisis, putting debt issuance on course for by far the biggest annual total in history.

Analysts say the UK should have little trouble finding buyers for the bonds, thanks to the Bank of England’s asset purchase programme. The BoE announced £200bn of bond buying in mid-March, helping to calm a rapid sell-off in the gilt market and ensuring the government can fund itself cheaply. Since then, the BoE’s buying has outstripped the volume of new UK government bonds hitting the market and more than made up for reduced demand from other traditional buyers, according to Daniela Russell, HSBC’s head of UK rates strategy.

“Right now the Bank of England is buying all the new gilts, and they have signalled they stand ready to do more” she said. “Given the increased strains pension schemes are facing it’s a very good job the BoE is hoovering up the supply.”

The update to the UK’s borrowing plans, announced on Thursday by the Debt Management Office, means bond sales will hit £225bn in the first four months of the current financial year.

UK Treasury to subsidise wages of nearly 3m workers via furlough scheme

Jim Pickard in London

Alok Sharma, UK business secretary, has revealed that 2.8m workers from 387,000 companies are to be paid subsidised wages through the Treasury’s furlough scheme — which was only set up two days ago.

Nearly half a million small companies had received grants of up to £25,000 amounting to some £6bn, Mr Sharma also told the business select committee.

The Treasury has vowed to guarantee up to £330bn of loans provided by banks to struggling businesses. Mr Sharma said £11.2bn has so far been agreed through the “corporate loan facility” for large investment-grade companies.

Another £2.8bn has been committed as loans to small companies through the Coronavirus Business Interruption Loan Scheme, with 16,600 acceptances out of 38,000 applications. Mr Sharma insisted the government was right to guarantee only 80 per cent of each loan — compared with 100 per cent in some countries — on the basis that the UK government was providing a wider array of support to business.

The business secretary added that he had heard calls for longer shopping hours on Sundays from 40 MPs and some UK retailers — an idea opposed by the shop workers union Usdaw.

UK government has lent £3bn to businesses in contentious scheme

Daniel Thomas in London

Almost £3bn has been lent to struggling small businesses under the much criticised government-backed loan scheme as officials continue to come under pressure to expand state guarantees.

More than 16,600 companies have received loans under the Coronavirus Business Interruption Loan Scheme (CBILS), according to data released on Thursday morning, doubling the total from last week. Officials now say that more than £300m is being lent every day on average to businesses hard hit by the pandemic lockdown.

Lenders have received more than 36,000 completed applications so far, which means that almost half have been approved to date. Others are still being processed and may be approved over the coming days, although the figure also includes those that have been rejected.

But despite over half the total number of loans provided through CBILS being approved in the past eight days alone, taking the total to more than £2.8bn, many companies are still critical of the government bailout programme.

The scheme has faced questions from company bosses and MPs after businesses were turned away as they did not meet the tough criteria to access the loans, which includes proof of future viability despite the economic uncertainty caused by the coronavirus outbreak. Others have been frustrated by long delays or mixed messages from their branches as they fast ran out of cash.

Markets ‘almost immune’ to data

Markets have taken another historically poor set of data in their stride, continuing a pattern that has seen investors look past the churn of current economic figures and instead focus on the nature of a future recovery.

The pound was 0.2 per cent higher against the US dollar at $1.2350 following the UK’s fastest decline in business activity on record, while the euro slipped slightly – by 0.3 per cent – following the eurozone’s similarly grim numbers.

European stocks gave up some of their earlier fragile gains, with the benchmark Stoxx Europe 600 index flat, having opened up 0.4 per cent.

Olivier Konzeoue, forex sales trader at Saxo Markets, said markets “are almost immune to data at the moment”.

“The focus is instead going to be on the various exit strategies as well as the stimulus initiatives put in place by governments and central banks to counter the negative effect of coronavirus,” he added.

China to donate an additional $30m to the WHO to tackle Covid-19

Tom Mitchell in Singapore

China will give the World Health Organization an additional $30m to support its efforts in combating the global coronavirus pandemic, the country’s foreign ministry announced on Thursday.

Hua Chunying, the foreign ministry’s chief spokesperson, said the donation was in addition to $20m donated last month to the WHO’s coronavirus prevention efforts, according to Reuters.

The move comes a week after US President Donald Trump said he would suspend US funding of the global health organization, which he accused of “severely mismanaging” the coronavirus pandemic. American allies were harshly critical of the decision.

The US gives more than $500m to the WHO each year, making it the organisation’s largest donor.

The Chinese government has been on the defensive over recent weeks as increasing numbers of politicians in the US, Europe and Australia call for a full official investigation into the origins of the coronavirus.

On Wednesday, Mike Pompeo, US Secretary of State, accused Chinese officials of destroying coronavirus samples at the outset of the epidemic there and failing to report how rapidly it could spread until it was too late to contain the outbreak.

Quarter of UK businesses have halted operations, says ONS

Delphine Strauss in London

A quarter of UK businesses had temporarily closed or paused trading by early April and two-thirds of the remainder reported financial performance outside their normal range, the Office for National Statistics said on Thursday.

Twenty-seven per cent of the workforce has already been furloughed while less than 1 per cent has been made redundant, from among 6,150 businesses in the period from March 23 to April 5, revealed the ONS’s fortnightly survey of the impact shutdown measures are having on the UK economy.

Four-fifths of all respondents said they were considering using the government’s job retention scheme, which allows employers to furlough staff and pays 80 per cent of their wages up to £2,500 a month.

The ONS also set out its latest findings on the toll the coronavirus shutdown is taking on individuals, with a separate survey showing that half of adults who are now homeschooling feel it is affecting their children’s wellbeing.

Four-fifths of adults responding to the survey, conducted between April 3 and 13, said they were very or somewhat worried about the impact coronavirus was having on their life, with more than half saying this was because of their inability to make plans.

EmoticonUK business activity slumps at fastest pace on record

Valentina Romei in London

Manufacturing and services activity in the UK has contracted at a rate “vastly exceeding that seen even during the global financial crisis,” as a large portion of the economy has been shut down due to the coronavirus pandemic.

The latest IHS Markit/CIPS flash composite purchasing managers’ index for the UK signalled by far the fastest decline in business activity since comparable figures were first compiled over two decades ago, with a reading dropping to 12.9 in April from 36 in March.

Chris Williamson, chief business economist at IHS Markit, said:

Business closures and social distancing measures have caused business activity to collapse at a rate vastly exceeding that seen even during the global financial crisis, confirming fears that GDP will slump to a degree previously thought unimaginable in the second quarter due to measures taken to contain the spread of the virus.

Economists at Markit said that the reading is consistent with a quarterly fall in GDP of 7 per cent, but that the actual decline could be even greater, partially because the PMI excludes the vast majority of the self-employed and the retail sector, which have both been especially hard-hit by the Covid-19 containment measures.

Global death toll continues to slow

Steve Bernard in London

The worldwide death toll rose by 6,607 yesterday, down slightly from the day before, to stand at 170,648.

This represents a four per cent daily increase, far lower than the peak of 15 per cent in late March, according to data from Worldometers.

New cases of Covid-19 rose by 79,956 on Wednesday, bringing the total to 2.49m.

The US registered its second consecutive day of 2,000 or more deaths. 2,108 people lost their lives on Wednesday according to data from The Covid Tracking Project, pushing the death toll to 42,103.

Spain’s daily number of deaths has increased steadily for the past seven days, prompting the government to extend its lockdown to May 9. Yesterday’s figure of 435 however, is much lower than the peak in early April of 961 deaths.

The UK’s death toll remained high yesterday with a further 763 losing their lives. The number of new cases has been below 5,000 for three days running, however, with 4,451 new diagnoses on Wednesday.

The number of global recovered cases rose by 27,218 yesterday, leaving a total of 717,444 free from the virus.

Swiss National Bank reports worst ever quarterly loss

Sam Jones in Zurich

The Swiss National Bank has suffered its worst quarterly loss since its foundation in 1907, after the impact of the coronavirus pandemic on global markets wiped SFr38.2bn from the value of its reserves in the first three months of the year.

The SNB’s huge foreign currency holdings — which have swelled significantly in recent years as part of targeted market interventions to hold down the value of the Swiss franc — dropped by SFr41.2bn in value in the three months to the end of March, the bank said in a statement on Thursday.

Losses were mitigated only by the bank’s huge gold pile, which rose in value by SFr2.8bn, as market panic drove the price of the safe haven precious metal up.

The SNB’s SFr800bn portfolio makes it one of the world’s single largest institutional investors. Its holdings include major stakes in US bluechip companies. At one point the bank owned more of Facebook than the company’s founder, Mark Zuckerberg.

The SNB does not seek to make a profit on its holdings. Instead they are a key part of its unorthodox monetary policy to maintain competitiveness for the Swiss domestic economy. Alongside a policy of negative interest rates, the SNB regularly sells francs in international markets and acquires assets denominated in foreign currencies instead. Both policies are intended to curb appreciative pressure on the franc.

PMI surveys reveal depth of European downturn

A series of closely watched surveys have illustrated the severity of the crash in economic activity across Europe, as lockdowns stifle businesses from Paris to Frankfurt.

Overall, the eurozone composite purchasing manager’s index – which monitors manufacturing and services activity – fell to 13.5 in April, from 29.7 in the previous month, a record low in more than 22 years of the history of the survey.

Earlier, French and German business activity also fell to record lows, in readings that suggest the region faces a major economic downturn.

Russia’s infection rate continues its decline after a month of lockdown

Henry Foy in Moscow

Russia’s rate of new coronavirus infections continued to slow on Thursday, raising hopes that the outbreak could be tempering after almost a month of national shutdown.

Russia recorded 4,774 new cases on Thursday, the lowest daily increase for six days. The 8 per cent rise in cases follows a 10 per cent increase on Wednesday and a 12 per cent rise on Tuesday.

The country’s total case count now stands at 62,773, with 555 deaths, after 42 new deaths from Covid-19 were recorded overnight.

President Vladimir Putin has continued to stress that the situation remains “under total control” despite a more than doubling of cases and deaths over the past week, and signs that the economic situation in the country is sharply deteriorating.

UK government to encourage use of cloth masks in offices and Tube

Jim Pickard and Clive Cookson in London

The UK government is set to recommend that the use of scarves or homemade cloth coverings could prevent the spread of coronavirus in some circumstances but will stop short of forcing people to use them in public.

Ministers will continue to discourage the general population from using medical face masks because they do not want to jeopardise the supplies of professional equipment to frontline health workers.

Scientists on the Sage panel of government advisers met on Tuesday and their advice is set to be presented to ministers on Thursday, with an announcement expected before the weekend.

Read the full story here.

What you may have missed

Britain’s Treasury announced that it would seek to raise another £180bn in finance in the three months from May to July — quadruple its original borrowing plans — to tide it over while the coronavirus pandemic curtails economic activity in the UK. It also said that tax receipts collected were down 12 per cent.

There are signs of a gradual return to economic activity in the UK as housebuilder Taylor Wimpey and car manufacturer Aston Martin said they would resume activity in early May. France is hoping for all businesses to be able to reopen when the country’s nationwide coronavirus lockdown is due to end on May 11. Dubai has also said that it is preparing to ease strict coronavirus lockdown measures.

The UK’s competition watchdog has cleared the £6bn merger of Just Eat and Takeaway.com, just days after giving provisional approval to Amazon’s investment in rival food delivery app Deliveroo.

Donald Trump followed through on a threat to suspend immigration into the US by signing an order that will prevent people from applying for green cards for 60 days and possibly longer.

The former head of a US government biomedical research agency accused the Trump administration of demoting him after he resisted efforts to fund potential Covid-19 treatments touted by Donald Trump.

China is struggling to cope with a rise in unemployment in the wake of coronavirus, with payment of benefits stalling and questions being raised about the real number of jobless in the country.

South Korea’s economy suffered its deepest contraction since the global financial crisis as the pandemic battered the country’s massive technology and industrial exporters.

Business activity slumps to record low in Germany

Valentina Romei in London

Business in Germany crashed this month, as the eurozone’s economic powerhouse followed France in recording its lowest readings of services and manufacturing activity on record.

The IHS Markit flash purchasing managers’ index for services fell to 15.9 in April from 31.9 in March, the lowest since record began more than 22 years ago as about three-quarters of companies reported a fall in activity.

The index indicates how business activity has changed compared with the previous month, with a reading below 50 indicating a majority of companies reporting a deterioration.

The index for manufacturing output also dropped to a record low at 19.4 in April, from 41 in the previous month. The IHS composite index, an average of services and manufacturing fell to 17.1 in April, also a record low.

April’s PMI surveys show “business activity across manufacturing and services falling at a rate unlike anything that has come before,” said Phil Smith, principal economist at IHS Markit.

France hopes most businesses will reopen on May 11

Victor Mallet in Paris

French finance minister Bruno Le Maire has said he wants all businesses to be able to reopen when the country’s nationwide coronavirus lockdown is due to end on May 11, although bars and restaurants will remain closed.

More than 10m employees — half the private sector workforce — are currently in France’s “partial unemployment” scheme, through which people retain their jobs even when not working but have most of their salaries paid with the help of state subsidies to employers.

The extended rollout of the scheme during the coronavirus pandemic is expected to cost the state at least €24bn.

“We want all businesses to be able to reopen on May 11,” Mr Le Maire told Franceinfo radio on Thursday, although he said startup dates might vary by region depending on the health situation. He declined to confirm that restaurants and bars would be allowed to reopen in mid-June.

Aston Martin to reopen Welsh car plant in early May

Peter Campbell in London

Aston Martin will reopen its St Athan factory at the start of May to produce the DBX vehicle that is critical to the brand’s future, as it also announced a 35 per cent pay cut for its chief executive, and wage cuts across the company.

The Welsh plant will be the first UK car factory to restart production following last month’s shutdown across the entire country. Bentley is due to reopen at Crewe on May 11.

The announcement comes days after Aston’s new chairman Lawrence Stroll called for the business to fire up its plants as soon as possible.

Several of Europe’s plants have restarted, with companies seeking to protect staff who go back to work.

Staff will return to work at St Athan on May 4, with the company ramping up to the site’s full quota of 550 people in the coming weeks. The facility is preparing to produce DBX, the company’s first sports utility vehicle, which is expected to start customer deliveries in the summer. Gaydon, Aston’s main factory, does not yet have a restart date.

On Thursday, Aston also announced a number of cost measures, including reducing the pay of chief executive Andy Palmer by 35 per cent, and cutting pay for most staff by 20 per cent.

Recoveries suggest pressure on German hospital is easing

Tobias Buck in Berlin

Germany reported 2,352 new coronavirus cases on Thursday, an increase of 2 per cent compared with the previous day, as the number of deaths related to Covid-19 rose beyond 5,000.

According to official data from the Robert Koch Institute in Berlin, the total number of detected infections in Germany now stands at 148,046. The number of deaths recorded over the past 24 hours rose by 215 to 5,094.

More than 103,000 Covid-19 patients have recovered from the disease so far. As in previous days, the number of recoveries reported on Thursday exceeded the number of new infections, suggesting the pressure on Germany’s hospitals and health services is easing day by day.

According to a separate report by the Robert Koch Institute released late on Wednesday, German laboratories carried out 323,449 coronavirus tests in the week ending Sunday, taking the total number of tests conducted since the start of the crisis to 2.07m. The latest weekly test numbers were notably lower than in previous weeks, possibly reflecting the public holiday on Easter Monday.

French business activity collapses to record low

Valentina Romei

France’s business activity plunged to the lowest on record as the government has locked down large swaths of the economy to stem the spread of Covid-19.

The IHS Markit flash purchasing managers’ index for services tumbled to 10.4 in April from 27.4 in March, the lowest since the series began more than 22 years ago.

The index indicates how activity has changed compared with the previous month with a reading below 50 indicating a majority of businesses reporting a deterioration.

Services is the dominant sector in France and dragged the composite index, an average of services and manufacturing, to 11.2 in April, down from 28.9 in the previous month.

France’s manufacturing industry reported a marginally less severe contraction with the corresponding index falling to 31.5 in April from 43.2 in March.

The rate of workforce contraction accelerated from March and was the fastest since data collection began. Flash estimates are published one week before the final results and are based on about 85 per cent of the typical responses.

LG Display losses widen as virus hits demand for electrics

Song Jung-a in Seoul

Net losses at LG Display, the world’s second-largest maker of electronic displays, more than tripled in the first quarter as the economic fallout from the coronavirus pandemic batters global demand for consumer electronics.

The Apple supplier on Thursday reported a net loss of Won199bn ($161m) in the first three months of this year, compared with a Won63bn loss a year earlier, extending its losing streak for a fifth consecutive quarter.

“We expect volatility in demand to increase down the road, as industry sectors are impacted by the Covid-19 outbreak,” said Suh Dong-hee, the company’s chief financial officer. “The difficult situation will inevitably linger, although it is expected that demand in IT products will grow due to stay-at-home orders and consequent surge in online activities.”

The South Korean company has been undergoing a tough restructuring process to cut costs after replacing its long-time chief executive last year and starting a voluntary redundancy programme as it grapples with a global supply glut in liquid crystal displays (LCDs). Its bigger rival Samsung Display said last month it would stop production of all LCD screens by the end of this year.

Daimler expects steep fall in profits due to Covid-19

Joe Miller in Frankfurt

Daimler expects its pre-tax profits for the first three months of the year to fall by almost 80 per cent, as it warned that the full effects of the coronavirus outbreak could not yet be assessed.

Earnings before interest and tax at the Mercedes-Benz owner fell to €617m, down from €2.8bn in the same period last year.

The German carmaker’s mobility division, which includes its ride-hailing and car-sharing businesses, saw its profits fall by 95 per cent, to €58m, from €1.2bn in the first three months of 2019.

Earlier this month, Daimler secured a €12bn credit line with four leading banks, on top of an existing €11bn facility.

On Thursday, the company said: “Having implemented a comprehensive set of cash protection measures and having increased our financial flexibility, we are confident that we are well positioned to manage the business, both during and after the COVID-19 pandemic.”

Housebuilders prepare to return to work

George Hammond in London

Taylor Wimpey, one of the UK’s biggest housebuilders, has said it will restart work on its building sites from May 4, signalling that construction projects might resume even while much of the country is in lockdown.

Vistry Group, another housebuilder formerly known as Bovis Homes, also announced on Thursday morning that it would re-open sites. Vistry aims to restart work even sooner, on April 27.

The two builders are the first of their listed peers planning to return to work after the government’s social distancing measures and the failure of vital supply chains stalled the vast majority of construction in late March.

The government has stopped short of mandating site closures, but housebuilders and their subcontractors had decided that work could not continue safely.

“The past few weeks have been unlike anything we have seen before, presenting huge challenges for businesses and individuals,” said Pete Redfern, Taylor Wimpey’s chief executive. “We are now confident that we have clear plans and processes in place so we can safely start back on site in a phased way beginning on 4 May,” he added.

European markets nudge higher

A measure of calm has returned to global markets, following a spike in volatility caused by a crash in the price of oil.

European stocks nudged higher in opening trading, with London’s FTSE 100 up less than 0.1 per cent and the continent-wide Stoxx 600 index 0.4 per cent higher.

Stocks across Asia gained, while futures tied to the S&P 500 on Wall Street were 0.4 per cent higher.

The price of oil also stabilised. Brent crude rose 4 per cent to above $21, supported in part by bellicose comments from President Trump that have fanned concerns of fresh tensions in the Middle East.

Among the key individual movers on a busy day for corporate earnings, shares in consumer goods giant Unilever fell 4.3 per cent after it pulled guidance and said sales growth was flat in the first quarter.

French business sentiment crumbles to historic low

Valentina Romei

France’s business confidence has tumbled to a record low, slipping below even the levels recorded during the depths of the financial crisis as sweeping lockdowns stymie activity across the country.

The business climate index lost more than 30 points and fell to 62 in April, the lowest since the series start in 1998 and below the 69 reached in March 2009, according to data from France’s office for national statistics (INSEE).

The index is compared with a long-time average of 100 and it reflects the trend in the services and manufacturing sector.

France’s data were published the same day as the Munich-based Ifo institute revealed that during the coronavirus crisis, 50 per cent of German companies are using short-time work while 18 per cent plan to cut jobs.

Short-time work is a government scheme that pays 80 per cent of workers’ salary when they are temporarily laid-off or have their working time reduced.

Equinor becomes the first oil major to cut its dividend

Anjli Raval in London

Norway’s Equinor will cut its quarterly dividend by two-thirds, marking the first major oil company to do so in response to a collapse in crude demand and prices triggered by the coronavirus outbreak.

The first-quarter cash payout will amount to $0.09 per share, which is a 67 per cent fall from $0.27 in the fourth quarter of 2019, the company said on Thursday.

“Equinor has already taken forceful actions to strengthen our liquidity and financial resilience under the current circumstances. In this extraordinary market situation, we have now also decided to reduce the cash dividend,” said chief executive Eldar Sætre.

Equinor has announced plans to curb capital spending, exploration activities and costs by $3bn in an effort to preserve cash. Last month it said it would suspend its $5bn share buyback plan. The company has also raised $5bn through a bond issuance.

UK to borrow a further £180bn for coronavirus response

Chris Giles in London

Britain’s Treasury announced on Thursday that it would seek to raise another £180bn in finance in the three months from May to July to tide it over while the coronavirus pandemic curtails economic activity in the UK.

The change in the government’s plans to borrow money are huge. In the Budget on March 11, it planned to raise £156bn over the whole of the 2020-21 financial year, roughly at a rate of £13bn a month.

In its latest revision to its financing remit to the Debt Management Office, it has requested to borrow at a rate of £60bn a month for the next three months, a figure more than four times as high as originally planned.

The Treasury said the immediate needs of financing public spending through the Covid-19 pandemic were likely to be concentrated in the early part of this financial year. “This higher volume of issuance is not expected to be required across the remainder of the financial year,” it added.

Corporate news round-up

Aston Martin intends to reopen its St Athan manufacturing facility, which employs 750 people in Wales, on May 5. The majority of the company’s workforce is furloughed and company executives have agreed to a voluntary reduction in pay, it said.

Housebuilder Taylor Wimpey will recommence construction on the majority of its sites in England and Wales from May 4 in a phased process that complies with social distancing requirements. It closed all building sites on March 24.

Unilever, the consumer goods company, reported flat sales in the first quarter relative to last year’s performance, as consumers bought more hygiene and in-home food products, while out of home consumption ground to a halt. The group maintains plans to pay out a dividend.

Miner Anglo American will cut costs by $500m and reduce its capital expenditure by $1bn to preserve cash, as it lowered production guidance for De Beers, its diamond mining subsidiary, by about 20 per cent.

Compass Group, the contract foodservice company, said that it was reducing its monthly costs by £450m and it would not recommend paying a dividend, as it reported that 55 per cent of its business was currently closed due to the lockdown.

French luxury brand Hermes said that sales in the second quarter will be significantly impacted by store closures, as it reported €1.5bn in sales in the first quarter, down 6.5 per cent on the previous year.

Unilever prepares for ‘lasting changes in consumer behaviour’

Judith Evans in London

Unilever’s underlying sales growth was flat in the first quarter of 2020 as coronavirus hit its ice cream and food service businesses, but the consumer goods group said it would still pay out an interim dividend.

The maker of Dove soap, Ben & Jerry’s ice cream and Lipton tea said turnover was up 0.2 per cent to €12.4bn during the quarter. Underlying sales growth, a key metric for the sector, was down to 0.0 per cent from 3.1 per cent a year earlier.

Alan Jope, chief executive, said:

As the crisis hits countries around the world, we see upswings in sales of hygiene and in-home food products, combined with some household stocking, and near cessation of out-of-home consumption, which is particularly affecting our food service and ice cream business.

We are adapting to new demand patterns and are preparing for lasting changes in consumer behaviour, in each country, as we move out of the crisis and into recovery.

The Anglo-Dutch group, which is the world’s largest ice cream manufacturer, said underlying sales at its food service division had declined 1.7 per cent. The company will maintain its quarterly dividend at €0.4104 a share but withdrew guidance for the year.

Tullow to raise cash through $575m sale of stake in Ugandan project

Nathalie Thomas in London

Troubled oil group Tullow is to sell its entire remaining stake in a Ugandan project to France’s Total for a deeply discounted $575m, just six months after a $900m deal involving the same scheme fell apart.

The London-listed but Africa-focused company, which had been in a battle to secure its future long before Brent crude prices slumped to levels not seen since the late 1990s this week, said it had struck a deal with Total over the Lake Albert Development project in Uganda, which would deliver $500m upon completion of the deal. A further $75m would be delivered when the partners in the scheme took a final investment decision.

The Uganda deal will deliver much-needed funds for Tullow, which is aiming to raise more than $1bn through asset sales, but the cover price marks a deep discount compared to a pact the company struck over Lake Albert back in 2017 with Total and Cnooc of China. Tullow had originally planned to reduce its stake in Lake Albert from around 33 per cent to 11 per cent via the previous $900m agreement, which fell apart in August last year following a tax row with Ugandan authorities.

However, the latest arrangement will deliver more cash for Tullow. Under the previous agreement, it would only have received $100m upon completion, $50m when the final investment decision was made and $50m when the first oil was produced. The remainder of the $900m would have funded its own costs towards developing the Lake Albert project.

Anglo American slashes diamond production forecast

Neil Hume, Natural Resources Editor

Anglo American has slashed guidance for its De Beers diamond business due to coronavirus lockdown measures as it announced plans to cut costs by $500m.

The London-listed miner said De Beers would now produce 25m to 27m carats this year, down from an earlier target of 32m to 34m, to bring supply into line with anticipated demand, which has been hit hard by the virus.

Anglo said in a quarterly trading update:

Lockdown measures have significantly impacted diamond production in southern Africa, manufacturing in India and retail operations in the United States, while consumer demand has returned to the Chinese market.

The company said it had identified cost savings of at least $500m and had started implementing restrictions on spending. In addition Anglo said a re-prioritisation of spending would mean its capital expenditure budget would be $1bn lower than previously flagged at $4bn to $4.5bn.

UK tax receipts show first signs of pandemic’s damage to finances

Chris Giles, Economics Editor

The first signs of the deep damage to the UK’s public finances from coronavirus are evident in official figures for March when the lockdown began to take effect.

Central government cash receipts collected by the exchequer were down 12 per cent compared with data from March 2019, with a particular hit to value added tax receipts from companies who were able to defer payments until the end of the year.

Cash receipts from income tax were also down 3.6 per cent, a highly unusual move and a sign of the pain to come for government finances.

Most of the public finance headline measures were largely unaffected, however, because they are measured on an accruals basis and the effects of the coronavirus pandemic have not yet shown up in the figures.

The Treasury will provide an estimate of the extra finance it thinks it will need later this morning.

Renault warns ‘impossible’ to assess outlook as sales fall sharply

David Keohane in Paris

Renault’s first quarter sales fell by 19.2 per cent as coronavirus brought demand to a standstill and the French carmaker said that it remained “impossible to assess” what the impact of the crisis would be this year.

The group reported sales of €10.2bn in the first quarter, down from €12.5bn in the same period last year. Global sales fell by 25.9 per cent, to 672,962 units in the first quarter, led by Europe that fell by 36 per cent to 321,756 units.

Renault, which had already been rocked by the arrest of former boss Carlos Ghosn over a year ago, had already cancelled its dividend, suspended financial guidance and closed much of its production around the world.

French rival PSA, which saw a 16 per cent decline in first quarter sales, said earlier this week that it expected the auto market to fall this year by 25 per cent in Europe, 10 per cent in China, 25 per cent in Latin America and 20 per cent in Russia.

Dozens of Indian journalists test positive for coronavirus

Amy Kazmin in New Delhi

Journalists in India have emerged as a vulnerable group for contracting coronavirus, as they report on the hardships facing citizens in one of the world’s biggest and most stringent anti-coronavirus lockdowns.

In the country’s financial capital Mumbai, at least 53 journalists – mostly working for television channels – have tested positive for coronavirus, while in the southern city of Chennai, 27 staff members of a local television station tested positive.

In New Delhi, Arvind Kejriwal, the chief minister, said the local government may set up a special facility for local journalists to be tested for the virus given how it had already spread among media workers elsewhere.

Indian journalists have been classed as essential workers, and have been documenting the lives and challenges facing citizens amid a stringent lockdown imposed with no prior warning or planning, which left millions of migrants stranded and dependent on food handouts to survive.

Taking notice of the surge of cases among reporters, India’s government had admonished the country’s media organisations to ensure that media persons took appropriate precautions while performing their duties.

India is one of the world’s biggest media markets, where newspaper reading has remained popular. But media companies have been hit hard by a collapse in advertising revenue since the coronavirus crisis hit, and many have announced layoffs and temporary pay cuts. Newspaper circulation has also been hit by rumours that coronavirus could be spread through its pages.

Hyundai Motor reports 42% fall in first-quarter net profit

Song Jung-a in Seoul

Hyundai Motor on Thursday reported a 42 per cent drop in first-quarter net profit, hit hard by the worsening global economic downturn caused by the widening coronavirus pandemic.

Net profit at the South Korean carmaker fell to Won553bn ($449m) in the first three months of this year from Won954bn a year earlier. But its operating profit rose 4.7 per cent to Won864bn, helped by a one-off gain of about Won100bn from a transaction with its joint venture with Aptiv, the Dublin-based autonomous driving technology group. Revenues increased 5.6 per cent to Won25tn.

The carmaker has warned of weaker profitability in the second quarter as Covid-19 batters global demand for new cars. Its executives told analysts that a V-shaped recovery would be difficult.

The carmaker last week halted a domestic production line producing Hyundai’s Tucson sports utility vehicles for four days, while affiliate Kia Motors plans to shut down one of its three domestic plants for 10 days. Hyundai and Kia together form the world’s fifth-largest automaker by sales.

Hyundai has suspended factory operations in the US, India and Brazil as the virus upends global supply chains and pummels demand.

The fallout from the outbreak has been cushioned by strong domestic sales encouraged by the fact that South Korea was able to bring the virus under control without imposing drastic measures such as lockdowns. Hyundai’s March sales in South Korea, the company’s biggest market, hit their highest level in more than four years, helped by a consumption tax cut.

US stock market flops raise governance concerns

At a time when global stock markets have come under intense pressure from the fallout of the coronavirus, a separate issue has arisen in China.

The scandal around Luckin coffee, which was revealed to have misrepresented its revenues last month, has raised questions over a host of other Chinese companies listed in the US — part of a trend that has proved lucrative for western investment banks.

Shares in the 29 Chinese companies that listed in New York since the start of 2017 are down by an average of 16 per cent, underperforming the wider market significantly.

Read the full story from the FT’s Hudson Lockett here.

Dubai is set to ease strict coronavirus lockdown measures

Simeon Kerr in Dubai

Dubai is preparing to ease strict coronavirus lockdown measures, including reopening shopping centres and allowing small gatherings, as the holy fasting month of Ramadan approaches.

In a circular, the economic department outlined protocols including measures to operate at 30 per cent capacity in centres and offices. The document, dated Wednesday, said businesses would be able to reopen once they had complied with the procedures. The official reopening date would be announced shortly, it said.

The guidelines mandate various social distancing procedures and sterilising methods — including the wearing of masks — for public transport, shopping centres, food and beverage outlets, and offices.

Dubai has been under a highly restrictive lockdown for a month, including a lockdown of almost three weeks during which residents were required to obtain a police permit to leave the house for groceries or emergencies.

The new regulations advise leaving home for necessities only, but allow family and close friends to gather privately in groups of no more than 10. Outdoor activities will be allowed once a day.

The United Arab Emirates has reported more than 8,200 cases with 52 deaths.

Thailand tourist arrivals shrink to a quarter of last year’s volumes

John Reed in Bangkok

Tourist arrivals to Thailand fell by 76.4 per cent in March from the previous year, the kingdom’s tourism ministry reported on Thursday, indicating the extent to which coronavirus-related lockdowns and flight cancellations are hitting a core industry in south-east Asia’s second largest economy.

Arrivals from China, Thailand’s largest source of foreign tourists last year, dropped by 94.2 per cent, and tourists from South Asia — a growth area for the industry before the Covid-19 pandemic — were down 89 per cent on a year ago.

Tourism accounts for between 10 and 20 per cent of Thai gross domestic product, counting both incomes of people who work in the industry and earnings of those who profit from it indirectly.

Separately Nitinai Sirismatthakarn, the president of Airports of Thailand, said on Thursday, in remarks quoted by The Nation newspaper, that flights and passenger volume at Thailand’s airports would drop by about half during the current fiscal year, and that he expected the volume of flights to return to normal by October 2021.

Inside Wuhan: China’s struggle to control the virus — and the narrative

In late January, the Chinese city of Wuhan, where the coronavirus originated, was placed under lockdown.

This month, by which time the virus had spread across the world and activity in many other cities had ground to a halt, those measures were eased.

In this report from the newly reopened city, the FT’s Don Weinland explores the Chinese government’s approach to a pandemic that went on to engulf the world.

Read the full story here.

Iron ore and gold shipments drive 30% jump in Australia exports

Primrose Riordan in Hong Kong

Australian shipments of iron ore to China and gold to Hong Kong drove the country’s goods exports up by nearly 30 per cent in March compared with the previous month.

March exports rose to A$36bn (US$23bn) from A$28bn in February’s estimate according to the Australian Bureau of Statistics. The March figures also represented a 16 per cent rise over the same month last year.

“There were increases in exports from the resources sector including strong increases in the value of exports of coal, gas and petroleum and in particular a large increase in the value of exports of iron ore to China,” the ABS said.

“The increase in the value of non-monetary gold was driven by exports to Hong Kong and the United Kingdom.”

Japan’s voluntary policy fails to deliver on social distancing target

Robin Harding in Tokyo

Japan is failing to meet its goal of an 80 per cent reduction in social contacts across wide areas of the country according to mobile phone tracking data that has become a closely watched proxy for the impact of a nationwide state of emergency.

Data released by the mobile phone company NTT Docomo showed reductions in the phone-wielding population of 40-75 per cent around large train stations across the country.

Compared with pre-coronavirus levels, numbers were down by 69.3 per cent around Shinjuku station in Tokyo and 74.5 per cent around Umeda station in Osaka, but only 40.9 per cent around the station in the smaller city of Gifu.

Ministers and public health officials have urged the public to step up their social distancing, warning it is essential to meet the 80 per cent goal in order to bring down the number of Covid-19 cases and avoid a stricter lockdown. Japan’s state of emergency calls for voluntary social distancing and has closed some businesses but not others.

Prada board withdraws dividend recommendation

Primrose Riordan in Hong Kong

The board of Hong Kong-listed Italian fashion house Prada has withdrawn its recommendation to distribute a final dividend for 2019, blaming the coronavirus outbreak and lockdowns imposed by Rome.

“The board has taken into consideration that as there are still uncertainties in assessing the duration of the pandemic and its impact, the withdrawal of its recommendation to distribute a final dividend is made in order to support the Group’s financial strength,” the company said in a filing to the Hong Kong stock exchange.

The company’s board had met on March 18, and decided to recommend a €0.02 per share dividend, but chairman Carlo Mazzi said the further spread of the virus meant they needed to reverse the move.

Prada beat analysts’ estimates last month when it reported a €255m net profit for 2019, up 7.9 per cent on the year before.

China struggles with sharp rise in unemployment

Sun Yu and Christian Shepherd in Beijing

China is struggling to cope with a rise in unemployment in the wake of the coronavirus pandemic, with payment of benefits stalling and questions being raised about the real number of jobless in the country.

The Chinese economy has been pummelled by the health crisis, with gross domestic product falling 6.8 per cent in the first quarter, after a national lockdown brought the country to a standstill.

Beijing has lifted restrictions on most regions in a bid to restart the economy. But some analysts say the country’s social safety net is not supporting the unemployed.

The Ministry of Human Resources and Social Security said last week that 2.3m people received jobless benefits in the first quarter of this year, the same as the previous quarter. Yet the nation’s official unemployment rate rose to 5.9 per cent, or 26m, in March from 5.2 per cent, or 23m, in December.

Read more here

China reports 10 new cases of coronavirus

Health authorities in China reported 10 new cases of the coronavirus to the end of Wednesday.

Six of the infections were in people who had recently returned from overseas, while three came in Heilongjiang, a province in the north-east of the country where fresh lockdown measures have been imposed on fears of a new outbreak.

The total number of confirmed cases in China has now reached 82,798.

Here’s some news you might have missed

Senior members of the UK’s governing Conservative party have called on the government to adopt a tougher stance towards China, citing growing concerns about Beijing’s handling of the coronavirus outbreak.

Delta Air Lines is raising a further $3bn to shore up liquidity as it anticipates a 90 per cent plunge in revenue during the second quarter.

Donald Trump warned Georgia’s Republican governor that he “strongly” disagreed with his decision to reopen the economy from Friday, saying it was “totally egregious” to open spas, beauty salons and tattoo parlours.

Mexico sold $6bn in bonds, with strong appetite from investors, despite the coronavirus pandemic, oil price shocks and downgrades to its sovereign debt and that of the state oil company.

The US death toll from coronavirus rose by more than 2,000 for the second consecutive day, pushing the nation’s total above 42,000.

Pakistan’s prime minister Imran Khan has tested negative for coronavirus, a Pakistani minister said late on Wednesday night, despite coming into contact with the head of a Pakistani charity who was later found to be infected.

A group of Republican senators has pleaded for the US Treasury and the Federal Reserve to change the terms of federal aid to businesses struck by the coronavirus pandemic to make it easier for energy companies to access the money.

France’s director general of health sounded a note of caution about preliminary findings from a Paris hospital this week that smokers were less numerous among hospitalised Covid-19 patients than in the general population, with one theory being that nicotine competes with the virus for access to receptors in the lungs and so protects smokers.

South Korean economy suffers biggest contraction since financial crisis

Edward White in Wellington

South Korea’s economy suffered its deepest contraction since the global financial crisis as the coronavirus pandemic battered the country’s massive technology and industrial exporters.

Gross domestic product fell 1.4 per cent in the first three months of the year, the Bank of Korea reported on Thursday, the biggest drop since a 3.3 per cent drop in final three months of 2008. The contraction compares with growth of 1.3 per cent in the fourth quarter of 2019 when hopes were building for a recovery in the country’s critical exports of computer chips and smartphones.

Sweeping lockdowns in China, South Korea’s biggest export market, in January and February led to production disruptions and softer demand for companies like tech giants Samsung, LG and SK Hynix and carmaker Hyundai.

A rapid outbreak of Covid-19 in February in South Korea — which was for a time the worst affected country outside China — saw a further hit to the local demand for smaller businesses.

Despite South Korea’s success in stemming the outbreak, Moon Jae-in, the South Korean president, on Wednesday warned that the economic crisis stemming from coronavirus was only just beginning as he revealed a sharp increase in spending to deal with the fallout of the pandemic to almost $200bn.

Economists cautioned, however, that despite the record spending and low interest rates, the government’s moves might still be insufficient given the exposure of South Korea’s export-dependent economy to a global recession.

Vietnam eases lockdown measures in Hanoi and Ho Chi Minh City

John Reed in Bangkok

Vietnam on Thursday began easing a lockdown aimed at fighting the spread of coronavirus, loosening strict social distancing measures in place in Hanoi and Ho Chi Minh City, the country’s two biggest cities.

Prime Minister Nguyen Xuan Phuc announced the measure on Wednesday after a sharp drop-off in reported Covid-19 infections since the beginning of this month in the country, which as of Thursday had reported no new cases for a week.

Mr Phuc warned that the public should “still be wary”, avoid going out, avoid crowds, and wear face masks outdoors.

On Wednesday, Vietnamese authorities put Dong Van, a town in Ha Giang province near the Chinese border where 7,600 people live, under lockdown after a coronavirus infection was reported there.

Since reporting the first case of the disease in January, the country has reported 268 cases of Covid-19 to date and no deaths, the lowest number for any large south-east Asian nation.

SK Hynix first quarter net profit plunges more than 40%

Song Jung-a in Seoul

SK Hynix, the world’s second-largest memory chipmaker, has warned of “unprecedented uncertainties” over the global semiconductor market after reporting a fall of more than 40 per cent in first-quarter net profit due to the coronavirus pandemic.

The South Korean chipmaker said net profit plunged 41 per cent year on year to Won649bn ($526m) in the first three months of this year while sales rose 6.3 per cent to Won7.2tn. Operating profit also fell 41 per cent to Won800bn.

The company forecast a decline in global smartphone sales but said demand for IT products and services would rise as a result of a broad shift to working from home, increased use of video conferencing and a boom in digital entertainment prompted by lockdowns in many parts of the world.

But the company warned: “If Covid-19 is prolonged, it will lead to increased demand volatility in global markets and might disrupt production activities.”

The company added it would push ahead with its existing investment plans and respond to stronger demand for high-capacity server D-ram chips although its capital spending would be much lower this year than in 2019.

Asia-Pacific stocks follow Wall Street higher

Asia-Pacific equities rose on Thursday, following gains for Wall Street overnight.

Japan’s Topix gained 0.6 per cent, while in Seoul the Kospi index rose 0.4 per cent. In Australia, the S&P 200/ASX added 1.1 per cent. The S&P 500 closed 2.3 per cent higher.

On Wednesday, Brent crude, the international benchmark, rebounded to trade above $20 a barrel after Donald Trump tweeted that he had ordered the US navy to “shoot and destroy” Iranian ships if they posed a threat.

Kura Sushi will return $6m payment protection loan

Sujeet Indap in New York

Shake Shack is not the only restaurant chain having second thoughts about a government bailout. Kura Sushi USA on Wednesday said it would return its $6m loan from the Payment Protection Program, the US Treasury’s fund to keep workers on payrolls.

California based Kura has shut down all of its 25 locations due to the coronavirus pandemic. It announced last week that it had secured its loan while still noting its balance sheet had $24m of cash, no debt, and that it had access to a $20m credit line from its listed parent, Kura Sushi Japan.

Outrage has grown from both the general public and Washington politicians in recent days as more public companies have announced they have taken PPP loans from a pool that was thought to be reserved for small-sized American businesses.

An FT analysis shows that Kura, which has a market capitalisation of around $90m, is one of more than 120 listed businesses that had so far taken a piece of the $350bn loan pool that was quickly depleted.

Shake Shack said on Sunday it would return the $10m it had taken because it could access other capital. Congress has since passed a PPP supplement for small businesses worth $310bn.

Harvard to turn down federal financial aid after public pressure

Peter Wells in New York

Harvard University said it would not accept $9m in financial aid allocated to it by the federal government’s Cares Act, bowing to pressure from the public and Donald Trump that it refrain from taking the money.

The elite university said it would not take funds from the Higher Education Emergency Relief Fund, which is part of the government’s programme to cushion the impact of the coronavirus.

“Like most colleges & universities, Harvard has been allocated funds as part of the CARES Act. Harvard did not apply for this support, nor has it requested, received or accessed the funds,” it said in a series of messages posted to Twitter.

Harvard’s move follows that of Ivy League rival Princeton, which earlier on Wednesday afternoon said it would refrain from accepting $2.4m allocated to it in the Cares Act.

Richard Branson pledges to property finance loan Caribbean house to support business enterprise

Richard Branson, founder of the multibillion-dollar conglomerate Virgin Team, has pledged to house loan his household and luxurious getaway vacation resort in the British Virgin Islands to aid his organization empire navigate the coronavirus disaster.

The pledge on his Necker Island home was produced in a letter to team, posted on Sir Richard’s particular website on Monday. It comes as Virgin Australia — 10 per cent owned by the billionaire’s business — teeters on the brink of collapse after failing to safe a governing administration bailout.

The letter tackles head on lots of of the controversies that have dogged the Virgin founder in current years, these kinds of as the tax position of his relatives and firms, and which now may perhaps threaten authorities help for Virgin Atlantic, 51 per cent owned by the billionaire.

The provider, like many airlines close to the entire world, is experiencing a likely fatal funds outflow as governments halt intercontinental air journey in the combat to incorporate the pandemic.

In the British isles, Sir Richard explained Virgin Atlantic could only “keep going” with governing administration aid. The team has requested for a offer of £500m in business financial loans and state ensures to aid fork out preset fees and bolster cash.

“It wouldn’t be absolutely free revenue and the airline would pay out it again (as easyJet will do for the £600m mortgage the government just lately gave them),” he wrote, in the letter initial cited by Sky News. “The reality of this unprecedented disaster is that a lot of airways about the globe need government support and a lot of have currently received it. Without the need of it there won’t be any levels of competition still left and hundreds of 1000’s more jobs will be lost.”

In Australia, Sir Richard said the disappearance of Virgin Australia would depart Qantas with “a monopoly of the Australian skies”.

Virgin Australia is predicted to make an announcement about its long run on Tuesday morning. A individual near to the negotiations instructed the Fiscal Times the board had lined up Deloitte to act as an administrator.

Virgin’s current shareholders — Singapore Airlines, Sir Richard’s Virgin Group, Etihad, HNA and China’s Nanshan Group — have all balked at putting additional income into the having difficulties airline, which is lossmaking and has web credit card debt of practically A$5bn ($3.2bn).

Sir Richard’s request for assist has drawn sharp criticism in the British isles, incorporating to a very long-managing controversy in excess of the entrepreneur’s record. A single government adviser instructed the FT not too long ago that it was not likely that ministers would want to be observed bailing out a billionaire when so quite a few people experienced dropped their positions.

Last 7 days the Uk government explained to Virgin to resubmit its bid for govt assistance. Individuals close to the condition explained to the FT that the airline experienced not done adequate to demonstrate it experienced explored other choices to bolster money before asking for point out aid. 

Sir Richard reported his private island in the British Virgin Islands, acquired when he was 29 a long time aged and considering the fact that transformed into a luxury vacation resort, would be accessible as security for any financial loans. “As with other Virgin property, our workforce will increase as a lot cash from the island as probable to help you save as numerous careers as achievable all-around the team,” he explained.

The Virgin founder hit back again at critics with a intense defence of his vocation, in both of those business enterprise and charitable endeavours. People shut to the entrepreneur stated he preferred to accurate “mistruths” about his file.

“Joan and I did not depart Britain for tax factors but for our love of the attractive British Virgin Islands and in distinct Necker Island,” said the London born magnate.

“Our businesses have developed hundreds of 1000’s of positions and paid out hundreds of millions in tax all around the entire world (and will proceed to do so). Our firms based in the United kingdom pay tax in the British isles.”

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On his prosperity, Sir Richard stated his web really worth was “calculated on the value of Virgin companies about the planet in advance of this disaster, not sitting down as money in a lender account prepared to withdraw”.

Sir Richard also spoke about the controversial 2017 conclusion by Virgin Care to sue the Countrywide Health and fitness Provider just after it missing a contract to present children’s solutions in Surrey. “Virgin Treatment was by no means intending to financial gain from it and 100 per cent of the funds awarded went straight back again into the NHS,” he explained. “If Virgin Care at any time does make a earnings, we have dedicated to reinvest 100 for every cent of that again into the NHS.”

He also insisted that Virgin Revenue Giving, a non-earnings fundraising system accused of taking expenses when processing charitable donations, “never helps make a income and never ever will”. The 2 for each cent price lined overheads which the group’s on-line financial institution, Virgin Cash, was now paying out “for all charities”.

Buyers hunt for ‘survivors’ in US earnings year

Buyers scouring companies’ benefits in the US earnings period that commenced this 7 days are not looking for expansion. Instead, although the coronavirus pandemic tears a gap out of economies close to the planet, several are searching for firms that can endure.

Stung by unexpected stops to revenues, many providers have fallen back again on credit traces and credit card debt borrowed in bond marketplaces to retain by themselves afloat. US investment-grade corporations lifted a history $150bn in March, as firms hoarded income to climate the downturn. Equity fund administrators want to make confident companies can repay those debts and cling on until eventually lockdowns stop and existence gets back again to normal.

“Survivability will be more appropriate than near-time period profitability — the standard metrics won’t make a difference that considerably,” claimed Liz Ann Sonders, chief investment decision strategist for Charles Schwab, about initially-quarter earnings. “For organizations that are in the crosshairs of this, there aren’t heading to be any close to-time period gains — that ship has sailed.”

US financial institutions, historically between the initial to report, have begun to paint a grim photograph of America’s corporate health. JPMorgan Chase’s earnings miss on Tuesday was the greatest due to the fact at least 2009, as considerably as Bloomberg documents stretch. The country’s greatest lender by assets, which created hefty provisions for bank loan losses, established a craze adopted by Wells Fargo, Financial institution of The united states and Morgan Stanley.

The KBW Banking companies index fell 14 for each cent from the get started of the week to Thursday’s close, on keep track of for the 3rd-worst week considering that the financial disaster.

The early final results set an ominous tone for the initially reporting year since the US financial state entered lockdown. If industrial and buyer sectors observe a comparable route, that could be plenty of to threaten the large rally in stocks due to the fact the depths of the provide-off in March.

The forward value-to-earnings ratio for organizations in the S&P 500, a well-known way for buyers to assess irrespective of whether inventory markets are running in advance of estimates of corporate income, is presently back again to levels found in January, in advance of the virus commenced to unsettle traders.

Line chart of Forward price to earnings multiple for S&P 500 showing US valuations remain high despite tumble in stock market

Some fund administrators are even now seeking to come across prospects. Healthcare corporations, which are immediately involved in the reaction to the virus, may emerge as a person of the most powerful havens, mentioned Margaret Vitrano, a portfolio manager with ClearBridge Investments.

“We are paying a ton of time looking at healthcare,” she stated. “One of the results of the virus is that hospitals and healthcare services are very entire, but people are deferring other techniques. Above time, they will occur back.”

Any destructive response to to start with-quarter success could also supply the probability to get into shares that have extensive had a pricetag some buyers are unwilling to pay.

Susan Schmidt, head of US equity for Aviva Traders Americas, has requested her crew of portfolio administrators and analysts to compile a “wish list” of stocks that fell challenging throughout the bear market place. Quite a few have given that loved gains, but there are nonetheless attractive organizations investing at a reasonable cost, she said.

“The chance in this market is to determine out exactly where the mispricing has took place,” Ms Schmidt claimed. “If you see as a result of the disaster there will be prospects.”

But actual bargains are the exception fairly than the rule, claimed Lee Spelman, head of US equities for JPMorgan Asset Administration. “I’ve lived by a great deal of crises — the 1987 crash, the tech boom and bust, the money crisis — but we have never seen everything like this,” she explained. “The economic system has just stopped and you have a black gap with revenues and funds stream. If you simply cannot make it out the other side [profits] won’t seriously make a difference.”

Analysts stated they are centered on measuring how substantially credit history organizations can entry and the likelihood that companies will breach limits on borrowing agreed with traders. Portfolio administrators are also eager to see which organizations will profit from the $2tn spending package the US government unveiled previous thirty day period.

Column chart of Debt to earnings ratio for S&P 500* showing US corporate debt creeps to highest level since the financial crisis

Numerous of these inquiries will not be answered by the earnings figures, but will be dealt with in phone calls with executives, and in the assistance for potential quarters that quite a few providers withheld previously this calendar year. “The quarterly earnings are not heading to be terrific but the ahead assistance is what will be most essential,” claimed Ms Vitrano.

Analysts be expecting earnings-per-share for providers in the S&P 500 to fall 15 for each cent for the quarter in comparison with the very same period past 12 months and 10 for each cent for the full year, according to Refinitiv. 

Power corporations are probable to endure most, pressured by the slipping oil cost, in accordance to Credit score Suisse projections, followed by consumer discretionary companies these as shops and carmakers. Utilities and communications services, a broad grouping that involves media corporations, will maximize earnings, in accordance to the lender, when healthcare is most likely to be flat.

“For vitality and buyer cyclicals, such as airlines and vacation businesses, it will be extremely, very challenging,” Ms Spelman reported.

Editor’s take note

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Coronavirus latest: Brussels calls for coordinated response to lockdown exit strategies

US stocks rise as earnings season kicks off

Wall Street advanced on Tuesday tracking European and Asian bourses higher on the back of better-than-expected Chinese data and the kickoff to US earnings season.

The S&P 500 climbed 1.7 per cent, while the Nasdaq Composite rose 1.8 per cent.

That followed gains in Europe, with the Stoxx 600 up 0.7 per cent, and Asia overnight, after data showed Chinese exports fell in March by much less than analysts had anticipated.

JPMorgan and Wells Fargo unofficially kicked off earnings season on Tuesday with both lenders reporting a sharp drop in profits and increases in loan loss reserves. Shares in both banks climbed at the open.

Investors are also watching to see when the American economy might reopen after Donald Trump claimed he had “total” authority as US president to lift coronavirus restrictions despite the nation’s constitution leaving such rights to state governors.

Elsewhere in markets, the yield on the US 10-year Treasury was little changed at 0.744 per cent. While the dollar index, a gauge of the buck against a weighted basket of peers, slid 0.3 per cent to 99.10.

Protests erupt in Mumbai as workers demand transport to rural homes

Amy Kazmin in New Delhi

Migrant workers trapped in India’s financial capital Mumbai have gathered at the Bandra Railway station to protest against the extension of the ongoing lockdown, and to demand their right to return home to villages across the country.

Thousands of rural migrants have been stuck in Mumbai – mostly without work – since March 22, when India suspended all its bus and train services for what was initially billed as a ‘one day’ symbolic people’s curfew. Neither public transport nor normal work has ever resumed.

On Tuesday morning, Prime Minister Narendra Modi announced that India’s curfew – which is completing three weeks – would be further extended until May 3, as the country’s confirmed coronavirus caseload continues to rise.

Mr Modi said that the government would relax the rules of the lockdown somewhat to allow some limited resumption of economic activity. Details are due to be announced on Wednesday.

But for many migrant workers stuck in Mumbai, who were unable to join the earlier mass exodus out of the city before the train services were suspended, patience has run out. Thousands stormed the Bandra station on Tuesday afternoon, demanding to be allowed to go home to their villages. Police armed with lathis dispersed the crowd.

Afterwards, Aditya Thackeray, son of the chief minister of Maharashtra state, tweeted that the violent protests were a result of Mr Modi’s government “not being able to take a call on arranging a way back home for migrant labour”. “They don’t want food. They don’t want shelter, they want to go back home,” Mr Thackeray tweeted.

On Friday, migrant workers – mainly from the eastern state of Orissa – trapped in the diamond-polishing centre of Surat, also rioted in the streets, demanding that they be paid the wages owed to them and provided with transport to return home.

117m children’s lives at risk from delayed measles vaccinations, says WHO

More than 117m children from 37 countries are at risk of missing out on life-saving measles vaccinations, the World Health Organization warned on Tuesday, as attempts to limit the spread of coronavirus put on hold immunisations around the world.

Two dozen countries have already postponed measles vaccination campaigns to avert further spread of Covid-19, and another 13 are expected to do so by the end of the year, said the WHO.

“We urge leaders to intensify efforts to track unvaccinated children, so that the most vulnerable populations can be provided with measles vaccines as soon as it becomes possible to do so,” the WHO said in a statement on Tuesday. “Urgent efforts must be taken now at local, national, regional and global levels to prepare to close the immunity gaps that the measles virus will exploit.”

Despite having a safe and effective vaccine for more than 50 years, measles cases have surged in recent years and caused more than 140,000 preventable deaths in 2018, mostly of children and babies, according to the WHO.

Hardship ahead in the UK due to coronavirus, chancellor says

Rishi Sunak, the chancellor of the exchequer, has warned that there is “hardship ahead”, after the Office for Budget Responsibility estimated the UK economy could shrink by more than a third in the second quarter if a lockdown to stop the spread of coronavirus is in place for three months.

“This will have a very significant impact on our economy,” he said. “It’s important that we are honest about that. People should know that there is hardship ahead – we can’t protect every person and business.”

The fiscal watchdog outlined a scenario in which a deep recession in the UK economy looks likely to leave a £220bn hole in public finances. Mr Sunak noted that “this is just one potential scenario” of many.

FT analysis suggests that £60bn will be added to UK public spending, which could push the deficit as high as £200bn in the coming year, as part of measures to support the country’s response to the Covid-19 outbreak including a £350bn rescue package for businesses.

“The report makes clear that the actions we have taken – unprecedented actions – will help to mitigate the impact of the virus on our economy,” he added.


England’s Covid-19 fatality count rises back above 700

The number of new Covid-19 fatalities in England ticked up considerably on Monday after lower figures were recorded over the Easter weekend.

A further 744 people who had been diagnosed with the disease caused by coronavirus died in hospital in the 24 hours to 5pm on Monday, according to NHS England. That was 77 more than the previous day, but still below Thursday’s high of 866.

The figures from England are published before the nationwide UK counts, but typically account for the bulk of overall deaths. The patients who died in England were between 34 to 102 years old, and all but 58 had other underlying health conditions. In total, 11,005 people in England have died in hospital from the virus.

Johnson advised against ‘immediately’ returning to work

Laura Hughes in London

Boris Johnson has been advised by his doctors not to “immediately” return to work and is recovering from coronavirus at his official country residence, Downing Street have said.

“He is continuing his recovery at Chequers,” No 10 said. “The priority is for the PM to rest and recover and his medical team have advised him not to immediately return to work.”

Meanwhile they confirmed that the prime minister’s chief aide Dominic Cummings has returned to work in No 10 after recovering from symptoms of the virus.

Wells Fargo quarterly profit tumbles as loan loss reserves jump

Robert Armstrong in New York

Wells Fargo’s net income fell almost 90 per cent in the first quarter as the economic impact of the coronavirus drove “unprecedented” increases in loan loss reserves as well as write-downs in the bank’s securities portfolio.

The $653m result followed an increase in loss reserves by $3.1bn and write-down of securities by $950m. Earnings per share of 1 cent missed the 33 cents expected by Wall Street analysts. The hit from the reserve increases and security write-downs was 73 cents a share.

Chief financial officer John Shewsbury said that, despite effects of the pandemic, the bank continued to see significant customer activity. “Commercial loans grew by $52bn, deposits increased by $54bn, we originated $48bn of residential mortgage loans, and we raised $47bn of debt capital for our clients,” he said.

The bank noted that in the month of March alone commercial customers had drawn $80bn from their lines of credit.

Wells Fargo shares have fallen 13 per cent since late February, when coronavirus fears first began to roil markets. They rose almost 3 per cent in pre-market trading on Tuesday alongside gains in US stock futures.

TAP faces possible nationalisation, Portugal’s prime minister says

Peter Wise in Lisbon

TAP-Air Portugal might have to be nationalised because of the impact of the coronavirus pandemic on the loss-making airline, the prime minister has said.

“We cannot exclude the possibility of nationalising TAP or any other company that is absolutely fundamental to our country,” António Costa said on Tuesday. “We cannot run the risk of losing them during this crisis.”

Portugal’s flag carrier has temporarily laid off 90 per cent of its 10,000 workers after drastically cutting its flights because of the pandemic. The company was partly privatised in 2015, leaving the state with 50 per cent. Atlantic Gateway, a private consortium headed by David Neeleman, a US-Brazilian airline entrepreneur, owns 45 per cent and employees 5 per cent.

Some TAP shareholders had expressed an interest in selling their stakes, Mr Costa said on local radio. Another company had expressed an interest in investing in the airline, but that possibility had been “suspended” because of the pandemic, he said.

This appeared to be a reference to unconfirmed reports that appeared in the German media in February saying that Lufthansa and United Airlines were considering a joint takeover of TAP.

Portugal on Tuesday reported an accumulated total of 17,448 confirmed coronavirus cases, an increase of 514 cases, or 3 per cent, over the previous 24 hours. The number of deaths linked to Covid-19 increased by 32 over the same period to a total of 567.

EasyJet founder intensifies rift with management

Nikou Asgari in London

EasyJet founder Stelios Haji-Ioannou has sent a complaint to the Financial Conduct Authority (FCA) about the airline’s Airbus order, ratcheting up tensions between the carrier’s largest shareholder and its board.

The UK-listed airline and its founder have been battling for weeks over a £4.5bn Airbus order for 107 new aircraft, which Sir Stelios argues should be cancelled in order to preserve cash in the face of the coronavirus crisis. Last week, easyJet compromised by saying it would defer the purchase of 24 aircraft.

In the letter to the FCA, Sir Stelios, whose family owns 34 per cent of the company, argues that the airline has breached the UK’s Market Abuse Regulations and Listing Rules as it did not obtain shareholder approval before deferring the Airbus order.

In a separate statement, Sir Stelios said: “If the FCA does not force them to call a shareholder vote, my company, easyGroup, will not hesitate to take the regulator to judicial review as the law provides.”


Deep UK recession may poke £220bn hole in public finances

Delphine Strauss in London

The UK’s lockdown has plunged the economy into a deep recession that looks likely to leave a £220bn hole in the public finances, according to the Office for Budget Responsibility.

The fiscal watchdog said on Tuesday that if the lockdown measures intended to slow the spread of coronavirus stayed in place for three months, national output could fall by around 35 per cent in the second quarter of 2020 – a contraction on a similar scale to statisticians’ predictions for France.

This would lead to an increase of £218bn in public sector net borrowing in 2021, relative to the OBR’s March forecast – largely due to a collapse in tax revenues, as well as government measures such as business rate holidays, and spending to support household and business finances.

The OBR said the figures should be taken as a “reference scenario”, not a forecast of what was most likely to happen, since it could not predict how long restrictions on economic activity would last.

It has assumed that the three-month lockdown would be followed by a further three months of partial restrictions, after which the economy would recover quickly with no lasting damage.

Even on these relatively benign assumptions, the deficit would explode, climbing to almost 14 per cent of GDP in 2020-21 – more than double its peak in the aftermath of the 2008 financial crisis, and the highest level since the second world war. In March, the OBR had forecast it would reach just 2.4 per cent of GDP in this fiscal year.

IMF writes off an estimated $214m of debt for poorest countries

Jonathan Wheatley in London

The IMF has granted an estimated $214m in debt relief to 25 of the world’s poorest countries by cancelling repayments owed to the fund for the next six months, allowing them to use the money to fight coronavirus instead.

Most of the countries covered by the grant are in sub-Saharan Africa, with others in Asia and the Caribbean.

The announcement comes ahead of a much larger debt suspension plan covering an estimated $18bn in repayments of official bilateral debt which the G20 group of the world’s richest advanced and developing countries is expected to announce at the IMF and World Bank spring meetings later this week, although there is no suggestion these debts will be cancelled outright.

Read more here

J&J cuts guidance but raises quarterly dividend

Donato Paolo Mancini in London

Johnson & Johnson has cut its guidance for 2020 but increased its quarterly dividend as the coronavirus pandemic has depressed the outlook for nearly all industries.

The New Jersey-based company expects to report sales between $77.5bn and $80.5bn for the year to come, down from a previous estimate of between $85.4bn and $86.2bn. It predicts adjusted earnings per share for the year in the $7.50 to $7.90 range, down from a previous estimate of $8.95 to $9.10.

The group however has increased its dividend by 6.3 per cent to $1.01 a share, or $4.04 for the year.

For the quarter that ended on March 31, the company reported adjusted earnings-per-share of $2.17, beating expectations, and sales of $20.69bn, up from $20.02bn in the same time a year before.

J&J is developing a Covid-19 vaccine that it hopes will be available early next year. Shares rose 4.5 per cent pre-market.


JPMorgan profits tumble as lender boosts defences for loan losses

Laura Noonan

JPMorgan Chase’s profits fell by 69 per cent in the first quarter as America’s biggest bank dramatically increased provisions for potential losses on loans to customers hit by the coronavirus crisis.

The bank reported net income of $2.87bn for the three months ended in March, down from $9.18bn a year earlier. Earnings per share of $0.78 were far worse than the $1.76 predicted by analysts contributing to a Bloomberg poll. 

The earnings miss was largely driven by a $6.79bn surge in provisions for loan losses, which chief executive Jamie Dimon attributed to “the likelihood of a fairly severe recession”. 

Total provisions came in at $8.29bn for the first quarter of 2020. Still, Mr Dimon said his bank “performed well in what was a very tough and unique operating environment — growing deposits in every line of business and providing loans as we extended credit and served as a port in the storm for our clients and customers”. 

GSK-Sanofi team up to accelerate Covid-19 vaccine development

Leila Abboud in Paris and Sarah Neville in London

GlaxoSmithKline and Sanofi, two of the world’s biggest vaccine makers, have agreed to collaborate to develop a vaccine for Covid-19 with the aim of speeding a treatment to market in the next 12 to 18 months.

Calling the partnership of erstwhile rivals “unprecedented”, Sanofi’s head of vaccines David Loew said in an interview that teaming up made sense because each company held “a piece of the puzzle”.

Sanofi’s vaccine candidate, which is an S-protein Covid-19 antigen based on recombinant DNA technology, needs what is known as an adjuvant to function.

GSK already has a “proven pandemic adjuvant technology” that it used during the H1N1 swine flu outbreak in 2009.

Exclusive: EU calls for ‘task force’ to manage lockdown exit strategies

Jim Brunsden in Brussels

Brussels wants the EU to create a “task-force like structure” to co-ordinate its exit from lockdowns, as it seeks to prevent “political friction” between member states, a document seen by the Financial Times reveals.

The commission will call for the co-ordinated effort as part of a “European roadmap towards lifting Covid-19 containment measures”, which it will publish this week.

The undated draft, seen by the FT, says that EU member states “should notify each other and the commission in due time before they lift measures and take into account their views”.

The commission warns in the leaked draft: “Action must be co-ordinated between the member states.”

A lack of co-ordination in lifting restrictive measures risks having negative effects for all member states and is likely to give rise to political friction between member states.

“Member states are invited to nominate single points of contact for the European Commission and neighbouring countries, ideally as part of an operational task force-like structure,” the document says.

A European network of such points of contact will monitor and exchange information in the weeks and months ahead.

The draft says that Brussels is working to speed up approval processes for testing kits and other crucial equipment, but says that the only way to overcome the pandemic will be the development of a vaccine.

“We will have to live with the virus until a vaccine or treatment is found,” the document says.

Fund managers build biggest cash stockpiles since 9/11

The coronavirus pandemic has prompted investors to sell down riskier assets, pushing the amount of cash they hold to the highest level since the September 11 terror attacks in 2001, according to a closely watched poll.

The latest Bank of America fund manager survey showed the average cash balance held by fund managers jumped to 5.9 per cent in April from 5.1 per cent in March and 4 per cent in February. That is well above a 10-year average of 4.6 per cent.

Analysts at the bank expect April to mark “peak pessimism” with cash balances receding next month.

The poll covered 207 managers with $597bn in assets under management. The vast majority – 93 per cent – of these believe there will be a recession in the next 12 months. This is higher than the previous peak during the financial crisis, when 86 per cent predicted a recession.

Most do not anticipate a swift path out of any recession. 52 per cent of those surveyed expect a “U-shaped” recovery, which would mean a slower return to normality, compared with 15 per cent who expect a speedy “V-shaped” recovery.

Toyota announces plan to resume car production in France on April 22

Kana Inagaki in Tokyo

Toyota has said it plans to resume production at its plant in France from April 22 following a month-long shutdown due to the coronavirus outbreak.

The world’s second largest carmaker also plans to restart operations at its plant in Poland from April 23, although production volume at both plants would be reduced initially.

Every large European and North American plant has been closed after carmakers shuttered sites from mid-March to protect workers and respond to falling demand.

As Toyota and other carmakers plan to restart production in Europe later this month, it remains unclear how fast vehicle demand will pick up as many big cities remain in lockdown.

The earliest start date for reopening plants in the UK, Turkey and the Czech Republic is May 4, the Japanese carmaker said.

Nato to focus on supply chain vulnerability

Helen Warrell in London and Michael Peel in Brussels

Nato defence ministers are to discuss whether they have become too dependent on medical supplies and protective equipment made by countries outside the alliance, in a meeting this week on the security implications of the coronavirus pandemic.

Speaking ahead of Wednesday’s summit Jens Stoltenberg, Nato secretary general, said that one of the “obvious” lessons to be learned was about building resilience in supply chains.

“We have to look into issues like supplies of medical equipment, protective suits, medicines…and also ask questions about whether we are too dependent on production coming from outside, whether we need to produce more of this equipment from our own countries,” he told reporters on Tuesday.

The supply line vulnerabilities revealed by the pandemic are already an acute concern in the EU, whose countries also form a large majority of Nato’s membership.

A mix of soaring demand, emergency national export restrictions and collapsing air cargo capacity has hampered European efforts to secure vital goods from Asia, including personal protective equipment and crucial hospital intensive care drugs.

Other topics under discussion will include how to respond to disinformation and propaganda being spread in relation to the virus.

Iran’s elite troops co-ordinate support for nearly 4m poorer families

Najmeh Bozorgmehr in Tehran

Iran’s Revolutionary Guard has set up a base to co-ordinate economic support for 3.5m families who cannot afford to make ends meet as a result of the coronavirus outbreak.

The charity works of all state organisations would be handled by the base, called Imam Hassan Mojtaba, with “packages” distributed by voluntary forces of the guard, basij, among the poorest segments of the society, Major General Hossein Salami said on Tuesday

“This will continue for some months until we go back to normal conditions,” he said.

The elite force has increased its social responsibilities in recent years, rushing to assist and feed people in times of natural disasters, in particular in poor provinces in what analysts say is part of the guard’s efforts to increase its popularity and power to influence politics. The coronavirus spread, it says, is a fresh opportunity.

The number of deaths in Iran related to the virus has risen by 98 over the past 24 hours, the first time in about a month that the country, which has been one of the most affected by Covid-19, has reported a daily toll below 100. That brings the total
to 4,683, Iran said on Tuesday, while 74,877 individuals have tested positive.

Coronavirus spread in Spain slows to lowest rate yet

Daniel Dombey in Madrid

The spread of coronavirus in Spain has fallen to its lowest rate since the beginning of the outbreak, although there has been an uptick in deaths, according to government figures released on Tuesday.

The ministry of health said there have now been 172,541 confirmed cases of the virus, just 1.8 per cent higher than Monday’s figure. The rate of increase is much below the speed with which coronavirus spread last month, when the tally regularly rose by 25-30 per cent a day.

The government figures indicate that to date 18,056 people have died after contracting coronavirus, 567 of them in the last 24 hours. This compares with 517 deaths in the previous 24 hour period, but remains far below the peak of 950 deaths a day at the start of this month. So far, 67,504 people have recovered.

Spain has sought to reduce transmission of the virus, hospitalisations and deaths through its month-long lockdown. This has been relaxed this week, with the end of a two-week-old ban on “non-essential” work.

South Africa slashes interest rates to post-apartheid low

Joseph Cotterill in Johannesburg

South Africa’s central bank slashed its benchmark rate to a post-apartheid low as Africa’s most industrialised economy braces for a longer pandemic lockdown.

The South African Reserve Bank said on Tuesday that it had cut its main repo rate by 100 basis points, to 4.25 per cent. The South African rand fell by 0.3 per cent against the US dollar after the announcement.

The bank had last cut rates by one percentage point less than a month ago as South Africa prepared to shut down its economy to help contain the spread of the virus. Last week President Cyril Ramaphosa ordered a national lockdown to be extended until the end of April.

Economists have estimated that South Africa’s GDP could fall by up to 10 per cent this year due to the lockdown.

The central bank has also launched purchases of government bonds to unblock strained local money markets.

Small brokerage closures on the rise in Hong Kong

Primrose Riordan in Hong Kong

Hong Kong is seeing an uptick in the closure of smaller brokerages and the chairman of the Hong Kong Securities Association Gordon Tsui estimated at least 100 of its 1,000 plus members were under severe financial stress.

“Most of the small-sized securities firms [have been] seriously, seriously affected,” Dr Tsui told the Financial Times, adding that he was aware of eight securities firms that had shut.

Many smaller firms in the city had out of date technology, which left them exposed as their clients increasingly did not want to meet in person, and made it difficult for their staff to operate from home, Dr Tsui said.

Smaller wealth managers in the territory that are dependent on transaction volume to make profits, rather than fees, are also under pressure, said Kenny Wen, wealth-management analyst at Everbright Sun Hung Kai.

At least 15 stock market participants such as brokerages, asset managers, or stockbrokers in Hong Kong have ceased trading since the start of the year, according to online records, while 22 ceased trading in the whole of last year.

Mr Wen said many wealth management clients were still losing money, even if the local stock market had calmed down over the past week. “It’s difficult to convince them to add more investments,” he said.


Record deaths in England and Wales in week to April 3, says ONS

Chris Giles in London

More deaths were registered in England and Wales in the week ending on April 3 than in any week since comparable estimates started 15 years ago, the Office for National Statistics said on Tuesday.

The statistical office said that 16,387 deaths were registered in that week, 6,000 more than the five-year average for that week in previous years.

Almost half of all deaths in London in that week, some 46.6 per cent, were registered with coronavirus mentioned on the death certificate, the ONS said, with the figure at 21.2 per cent across the whole country.

Most deaths were registered in hospitals, with nine in 10 deaths occurring there rather than in the community or in care homes. Anecdotal evidence suggests that the spread of the disease to care homes occurred later in the outbreak.

The Big Read: How coronavirus stalled climate change momentum

Leslie Hook and Aleksandra Wisniewska in London

At the birthplace of modern climate science near the top of the Mauna Loa volcano in Hawaii, scientists are looking for a change in atmospheric carbon dioxide concentrations, due to the global economic slowdown caused by coronavirus.

Ralph Keeling, a professor at the Scripps Institute who leads the atmospheric analysis programme, said a 10 per cent drop in fossil fuel emissions over one year would show up in atmospheric CO2 concentrations and be measurable at Mauna Loa.

All over the world, pollution levels are dropping fast. The lockdowns triggered by the pandemic, with about 2.6bn living under restrictions, are starting to have an impact not only on the virus but also on the planet.

Yet despite the potential short-term dip in emissions, there is a risk that the pandemic will overshadow environmental concerns. Climate talks have been delayed and new policy initiatives postponed.

Read The Big Read: How coronavirus stalled climate change momentum

Global Covid-19 cases pass 1.9m

Steve Bernard in London

Global cases of Covid-19 rose by 71,572 yesterday, the fourth consecutive day that the number of newly infected has fallen. This brings the global total to more than 1.9m.

The death toll on Monday held steady at 5,421, leaving the daily rate of growth in fatalities at 5 per cent.

Analysts have warned against assuming a peak has been passed, however, as many countries in Africa and South America remain in the early acceleration phase. The long Easter weekend could also have affected the timing of the reported numbers.

In the US, Monday’s death toll closely matched that on Sunday, with 1,535 people losing their lives. The total number of fatalities in the country now stands at 23,640, with more than 586,000 people confirmed to have contracted the virus.

Many of the hardest-hit European countries are seeing the number of new cases and deaths fall each day. Italy, Spain and France have all extended their lockdowns but have signalled they are planning to reopen their economies if the situation continues to improve.

The UK was the hardest-hit country outside of the US on Monday, with the death toll rising by 717 to 11,329. Meanwhile, Turkey continues to struggle to contain the virus with a further 4,093 new cases confirmed on Monday, the sixth consecutive day with 4,000 or more cases.

The number of recoveries worldwide rose by 21,312, leaving a total of 444,711 free from the virus.

Wizz Air to take hit of up to €80m on hedging losses

Central European carrier Wizz Air expects to take a hit of up to €80m in the March quarter and will lay off 1,000 employees.

The low-cost Hungarian airline, which is operating at 3 per cent capacity, said it would recognise exceptional losses of €70-80m as a result of hedging activity and make 19 per cent of its workforce redundant. Board members, pilots and cabin crew will take pay cuts of up to 22 per cent.

Many airlines lock in prices for fuel in advance to protect against volatility. However, with the price of crude oil having halved this year, many of these hedges will not have paid off. Jet fuel prices are down 64 per cent compared with this time last year, according to the International Air Transport Association.

But Wizz remained upbeat about its growth strategy and said that, as markets returned to normal, it “fully expects” to stick to plans to grow capacity by 15 per cent annually. It still intends to launch its Abu Dhabi subsidiary this autumn.

József Váradi, Wizz chief executive, said:

Wizz Air undoubtedly remains best placed for long-term value creation in the European aviation industry due to its low fare – low-cost business model and unique positioning as the market leader in the growing CEE market.

The group expected to report net profit of €270-280m for its financial year that ended in March but said it could not give any indication on outlook for the current year.

Renault pulls out of Chinese joint venture with Dongfeng

David Keohane in Paris and Peter Campbell in London

Renault has decided to stop selling petrol cars in China, pulling out of its loss-making joint venture with Dongfeng and reversing a strategy put in place with great fanfare by ex-boss Carlos Ghosn, as coronavirus hits the French carmaker hard.

Renault said on Tuesday morning that it had an agreement with Dongfeng to sell out of the 50-50 joint venture between the two partners, Dongfeng Renault Automotive Company.

The sale will also transfer full control of its plant in Wuhan, which was opened by Mr Ghosn in 2016, to Dongfeng and mean that DRAC will stop selling Renault-branded cars.

“We are opening a new chapter in China. We will concentrate on electric vehicles and light commercial vehicles, the two main drivers for future clean mobility and more efficiently leverage our relationship with Nissan,” said Francois Provost, chairman of the China business for Renault.

The Chinese market is expected to slow further this year due to the effects of coronavirus. Renault is one of the carmakers that has been hardest hit by the pandemic: it has shut plants around the world and is considering taking out bank loans guaranteed by the French state worth up to €5bn to see it through the crisis.

A late arrival to the Chinese market, Renault has struggled to make a dent compared with rival mass-market producers such as Volkswagen and General Motors.

Fellow French group PSA, which owns Peugeot and Opel, has also performed poorly in the market, as has Italy’s Fiat Chrysler.

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Donald Trump claimed he had “total” authority as US president and the federal government had “absolute power”, while insisting he had the power to lift restrictions despite the constitution giving such rights to state governors.

SoftBank has warned of its biggest annual operating loss after its $100bn investment fund sustained a hit from the market turmoil sparked by the coronavirus outbreak. In a separate story, SoftBank’s U-turn on the rescue package for WeWork has revived the feud between the Japanese investor and Benchmark Capital.

Chinese exports fell 3.5 per cent year on year in March, marking a modest rebound after steep falls in January and February.

Oil prices rose 1.4 per cent on Tuesday after coming under pressure on Monday on doubts that a US-backed Opec deal to cut almost 10 per cent of global supplies would be enough to rescue the market.

None of the new mechanical ventilators for treating coronavirus patients has obtained UK regulatory approval, a month after the government called for British industry to help plug a shortage.

President Emmanuel Macron admitted on Monday night that the French government had been ill-prepared for the crisis. He said signs were emerging that the pandemic was beginning to stall. He extended France’s lockdown for a further month.

The IMF will offer grants to some of the poorest nations, mainly in Africa and Asia, to allow them to cover their debts to the Washington-based multilateral lender.

Brexit talks between the UK and the EU will resume on Wednesday in an attempt to figure out how to salvage negotiations on London’s future relationship with Brussels in the face of disruption on account of the pandemic.

Q&A: We answer your questions on coronavirus and globalisation

Rana Foroohar and Edward Luce

In countries around the world, many global connections were suddenly severed — or at least put on an indefinite pause — due to the spread of coronavirus. With flights cancelled, travel bans enacted and global trade upended, will Covid-19 end globalisation as we know it? 

In late February, Rana Foroohar wrote that the novel virus was speeding up decoupling of global economies. Less than two weeks later, Donald Trump closed off direct US travel to the European continent for the first time since the second world war — a decision that contradicted expert guidelines, Edward Luce said. 

Rana and Ed have been following the economic fallout of coronavirus for the US and its global partners. On Tuesday, they’re here to answer your questions about how the outbreak has already, and will continue to affect, globalisation. 

Ask your questions in the comments here.

Ed and Rana will be dropping in regularly to answer them over the course of the day.

Russia records 170 new deaths as infection rate gains pace

Henry Foy in Moscow

Russia recorded 2,774 new coronavirus cases on Tuesday, a third consecutive record daily increase, as the rate of infection continued to gain pace in the country.

Russia now has 21,102 cases of Covid-19, the country’s coronavirus agency said, and 170 people have died from the disease.

From small numbers a few weeks ago, Russia’s outbreak has soared over the past fortnight, with cases doubling roughly every four days.

President Vladimir Putin has warned citizens that the short-term outlook looks negative, as Moscow this week brought in a system of electronic passes that people will be required to apply for if they want to travel around the city.

Iran to float 10% of wealthy state-run company Shasta

Najmeh Bozorgmehr in Tehran

Iran is set to float 10 per cent of one of its wealthiest state-run companies on the country’s stock exchange on Wednesday, in a bid to generate income to limit the economic impact of coronavirus.

The sale of shares in Shasta — the investment arm of the Social Security Organisation of Iran — will constitute one of the biggest privatisation programmes in Iran. The multi-billion-dollar holding company runs operations in various sectors, ranging from petrochemicals and cement to finance and shipping.

Iran’s president Hassan Rouhani said on Friday that companies owned by the government, the broader public sector and armed forces should “quickly” float shares on the Tehran Stock Exchange.

His government — which was already reeling from tough US sanctions and a huge drop in its petrodollars — is facing the dark prospect of a worsening economic recession that will slash its income streams, including tax revenue.

The Islamic republic has opposed strict quarantine policies as shrinking income has left the government unable to support millions of Iranians who would be put out of work.

Mohammad Shariatmadari, Iran’s labour minister, in a post on Twitter, assured the public on Tuesday that the floating of Shasta’s shares would be a “win-win” situation for them and the national economy.

Germany’s Covid-19 case count rises at slowest pace in three weeks

Tobias Buck in Berlin

Germany reported 2,082 new coronavirus cases on Tuesday, the lowest number in more than three weeks and further evidence that the rate of increase is slowing sharply.

Germany has detected a total of 125,098 coronavirus cases since the outbreak started, according to official data from the Robert Koch Institute in Berlin. The latest daily increase was less than 2 per cent.

Another encouraging piece of data to emerge on Tuesday was that the number of Covid-19 recoveries exceeded the number of new infections. More than 68,000 patients have now recovered from the disease, or more than half the total number of cases.

There were 170 new deaths related to coronavirus, bringing the total up to 2,969. That means the German case fatality rate now stands at 2.4 per cent – higher than in the first weeks of the pandemic but still notably lower than in countries such as Spain and Italy.

GAM reviews salaries and cuts staff as investors withdraw funds

Siobhan Riding in London

Troubled investment manager GAM has been forced to review salaries and cut jobs after suffering a 26 per cent drop in assets in its core business line.

The Swiss group has been hit hard by coronavirus, with heavy investor redemptions and negative market movements pummelling its core investment management business. Assets under management in this unit fell from SFr48.4bn ($50bn) to SFr35.7bn ($37bn) in the first quarter.

In response, GAM said it would accelerate its cost-cutting programme, targeting total reductions of at least SFr65bn this year, compared with its previous objective of SFr30bn. The fund manager is pushing ahead with a previously announced round of job cuts, although it said it expected to make fewer than planned thanks to a voluntary redundancy programme it completed last month.

It also plans to review salaries across the group, particularly focusing on senior non-investment roles. The aim of this is to manage costs while minimising the impact of compulsory redundancies “during the difficult Covid-19 environment”, said GAM.

Chief executive Peter Sanderson added: “GAM has not been immune to some of the toughest market conditions the industry has seen, and we saw our assets under management decline as a result of the Covid-19 crisis.”

GAM’s fixed income business accounted for the lion’s share of its asset drop in the first quarter, suffering SFr5bn in net investor withdrawals. GAM’s total asset pool, which also includes assets in its private labelling business, fell from SFr132.7bn to SFr112.1bn in the first quarter.

France sees 9% budget deficit in recession-hit 2020

Victor Mallet in Paris

France has again downgraded its economic forecasts for the year as a result of the coronavirus pandemic, with ministers predicting the economy would shrink by 8 per cent in 2020 while the budget deficit would reach 9 per cent of gross domestic product.

The new forecasts followed President Emmanuel Macron’s announcement on Monday night that the lockdown on the population designed to stop the spread of the Covid-19 virus would remain in force until May 11.

Bruno Le Maire, finance minister, said new forecasts for revised budget legislation included minus 8 per cent growth this year.

Gérald Darmanin, budget minister, said the expected budget deficit was now 9 per cent of GDP — up from the previous 7.6 per cent estimate and last year’s 3.1 per cent and the worst since the second world war — while public debt would rise to 115 per cent of GDP from the current 100 per cent and the previous prediction of about 112 per cent.

“In three weeks we’ve twice re-done the budget with Bruno Le Maire and added €110bn to support the economy,” Mr Darmanin told Franceinfo radio.

European stocks open higher

European equity markets have tracked their Asian counterparts higher this morning after Chinese trade data fuelled investor optimism that its economy was bouncing back.

The Europe Stoxx 600 added 1.2 per cent at the open, with gains of 0.8 per cent, 1.6 per cent and 0.9 per cent respectively for London’s FTSE 100, Frankfurt’s Dax 30 and Paris’s Cac 40.

The moves came after data showed that Chinese exports fell by much less than analysts had anticipated in March, marking a modest rebound from the previous two months’ figures as the country ended lockdowns aimed at combating the coronavirus. 

China’s CSI 300 index of Shanghai- and Shenzhen-listed stocks rose 1.8 per cent following the data, while the Hang Seng in Hong Kong ticked up 0.8 per cent.

“While the data has not always proven reliable, it suggests that the Chinese economy is starting to stabilise faster than expected,” said Sebastien Galy, senior macro strategist at Nordea Asset Management.

As markets open in London, we are bringing you a round-up of the top corporate announcements this morning.

Belgium drinks company AB InBev cut its proposed dividend in half to €0.5 per share and rescheduled its annual shareholders’ meeting from the end of April to early June.

National Express, the coach operator, said in a trading update for the first three months of the year that there had been “a significant decline in revenue as services have been withdrawn” since the outbreak of coronavirus, although revenue was still up 8.9 per cent year on year. Since its update last month, the company has secured a further £800m of additional credit facilities and the board has withdrawn its recommendation for a dividend payout. Two members of staff passed away due to coronavirus, the group said.

Passenger numbers at Heathrow fell 52 per cent in March compared with last year, with figures in April set to shrink by more than 90 per cent “with lasting and significant industry-wide effects predicted”. The airport moved to single runway operations last week and activities will be limited to Terminal 2 and 5 only over the coming weeks.

Pub group Mitchells & Butlers has furloughed 99 per cent of its workers, while basic pay for all employees including the board has been reduced by 60 to 80 per cent. It has been granted a temporary waiver until mid-May for a possible technical breach of its debt covenants.

Clothing retailer Next is reopening sales online, after it closed its ecommerce operations on March 26. It will initially only offer items customers need the most, it said.

Taiwan reports no new coronavirus cases for first time in a month

Kathrin Hille in Taipei

Taiwan reported no new confirmed coronavirus cases for the first time in more than a month on Tuesday, as the country’s health authorities become increasingly confident that they have successfully beaten back a second wave of infections.

“After 35 excruciating days where we had an average of almost 14 cases a day, we can report that there are zero confirmed cases,” said Chen Shih-chung, health minister.

Although Taiwan’s count of infections soared from 45 on March 9 to 393 this Monday, the country remains one of the world’s most successful in handling the disease.

Despite its geographical proximity to China and close economic ties, with millions usually travelling in both directions every year, Taiwan caught most imported infections early and thus avoided large-scale community transmission.

Other Asian countries that had been praised for their epidemic prevention policies, such as Singapore, have struggled as people have arrived from Europe and America, triggering a second wave of infections.

“Of course, the epidemic isn’t over yet. But this is still worth cheering a bit,” Mr Chen said. Earlier, he remarked that community transmission had already become highly unlikely in Taiwan.

European stocks set to open higher

Equity markets across Europe were on track to follow their Asian counterparts higher this morning after positive Chinese trade data fuelled investor optimism that its economy was bouncing back.

Futures trade suggested the Stoxx Europe 600 was set to open 1.2 per cent higher, with a similar gain for Paris’s Cac 40. In Frankfurt and London, the Dax 30 and FTSE 100 were on track for gains of 1.2 per cent and 1 per cent respectively.

The upbeat sentiment comes after data showed China recorded a trade surplus of $18.5bn for March, compared with a deficit of $7.1bn in January and February. That pushed Hong Kong’s Hang Seng up 0.7 per cent and mainland China’s CSI 300 up 1.5 per cent.

Investors will also be looking ahead to US earnings today and this week that should give an indication of the extent of the hit to corporate profits from the lockdowns imposed worldwide.

Asia stocks rise as Chinese trade data boost sentiment

Hudson Lockett in Hong Kong

Stocks across Asia Pacific gained ground after Chinese trade data brightened sentiment and as traders awaited a raft of US earnings for a further glimpse into the impact of the coronavirus pandemic on the global economy.

Investors have begun to hope there is light at the end of the tunnel in the virus outbreak, with signs that governments around the world may soon start easing economic lockdowns.

On Tuesday, China’s CSI 300 index of Shanghai- and Shenzhen-listed stocks rose 1.1 per cent after data showed that exports fell 3.5 per cent year on year in renminbi terms in March, marking a modest rebound from the previous two months’ figures.

However, Julian Evans-Pritchard, senior China economist at Capital Economics, warned that the recovery in exports was “likely to be short lived” as overseas demand would probably fall in the second quarter of the year due to the impact of the pandemic in other parts of the global economy.

Elsewhere, Japan’s Topix index added 1.7 per cent, while South Korea’s Kospi advanced 1.9 per cent. Australia’s S&P/ASX 200 rose 1.6 per cent and Hong Kong’s Hang Seng gained 0.9 per cent on their first day of trading following the Easter break.

North Korea tests short-range cruise missiles

Edward White in Wellington

North Korea on Tuesday carried out its latest military provocation as Kim Jong Un continues to test weapons despite the threat posed to his country by the global coronavirus pandemic.

The North Korean military fired “multiple anti-ship short-range cruise missiles” into the Sea of Japan, according to a statement by the South Korean military carried by Yonhap, the state news agency.

The weapons test was the latest in a series of instances over recent weeks in which Pyongyang has fired missiles into the waters off its eastern coastline. South Korea disputes the name of the sea, referring to it as the East Sea.

The short-range missile tests have been condemned by many in the international community as breaching UN sanctions. But they have not been viewed by US President Donald Trump as breaking Mr Kim’s 2018 self-imposed moratorium on testing of long-range missiles and nuclear weapons.

After reports of the coronavirus outbreak emerged from neighbouring China in January, North Korea swiftly shut its borders and state media this month reported a sharp reduction of people quarantined in the isolated country.

The FT reported last month that about 600 people had been tested for the virus inside the country and North Korean officials have secretly sought for further international assistance to increase coronavirus testing.

However, Pyongyang’s claims of zero coronavirus cases continues to draw international scepticism, including from General Robert Abrams, who leads the 28,500 US troops in South Korea and has described the claim as “impossible”.

Modi extends India’s lockdown until May 3

Amy Kazmin in New Delhi

Indian Prime Minister Narendra Modi has extended the country’s national lockdown against coronavirus until May 3, as the number of coronavirus cases has hit 10,362, despite stringent restrictions in place since the end of March.

“All countrymen have to remain under lockdown,” he said. “We need to contain coronavirus in all circumstances.”

However, he said that some relaxation would be put in place for essential services after April 20, when the battle against coronavirus would be reviewed, without giving further details.

At present, all commerce has been suspended, with only grocery shops and pharmacies allowed to operate; even India’s ecommerce companies are only permitted to deliver food, household cleaning products and medicines.

India had about 500 confirmed coronavirus cases when Mr Modi unexpectedly announced a three-week national lockdown to stop the spread of the disease on March 25, bringing most of the country’s economic activities to an abrupt halt.

Millions of migrant workers poured out of India’s big cities and undertook long treks back to their rural villages, where they felt better able to withstand the collapse of their incomes.

Industry groups have warned of economic devastation unless India’s strict lockdown is relaxed somewhat to permit some essential supply chain activities to be repaired.

Exporters have warned of the potential for millions of job losses in the coming months, as manufacturing comes under severe strain.

China approves human trials on two more vaccines

Xueqiao Wang in Shanghai

China has approved clinical trials on humans for two more experimental vaccines that are being developed to combat coronavirus, which has killed more than 100,000 people worldwide.

The first is being developed by the Wuhan Institute of Biological Products, a unit of the state-backed SinoPharm group. The second is being developed by Sinovac, a Beijing-based unit of Nasdaq-listed Sinovac Biotech, which claims to have been the first to produce a vaccine against H1N1 influenza.

Nearly 1,500 people will be recruited for the Wuhan Institute-SinoPharm trial, which will be conducted in Wuzhi county in Henan, according to the information on the China’s clinical trial registry.

Last month, China’s Academy of Military Medical Sciences in conjunction with HK-listed biotech company CanSino Bio also received approval for clinical trials on human volunteers, according to state media.

Australian business confidence drops to lowest since 1989

Jamie Smyth in Sydney

Australian business confidence has experienced its largest decline on record and sits at its weakest level since the survey was introduced in 1989 due to the coronavirus crisis, according to the latest National Australia Bank business survey.

All industry sectors also reported sharp declines in business conditions in March, although recreation and personal services saw the largest hit due to social distancing rules introduced to slow the spread of the virus.

“We expect a recession of unprecedented speed and magnitude for the Australian economy over the next three quarters. This will see a sharp increase in unemployment,” said Alan Oster, NAB chief economist.

He said most economists expect a fairly rapid bounce back in activity once the spread of coronavirus was contained and social distancing rules could be relaxed, but the most immediate worry for the business sector was the impact on cashflows.

“Without cashflow support, it is likely many businesses will be severely impacted and unable to return to operations once the economy begins to recover,” said Mr Oster.
Business confidence fell to minus 66 index points — its lowest level on record.
Business conditions fell to minus 21 index points, slightly weaker than the 2008 financial crisis, although it remained above the trough seen in the Australia recession in the early 1990s.

Australia’s treasury forecast the nation’s unemployment rate would double to 10 per cent due to the crisis, which has forced the government to unveil more than A$200m in economic stimulus measures.

Trump threatens to overrule state governors on lockdown measures

Kadhim Shubber in Washington and Peter Wells in New York

Donald Trump claimed he had “total” authority as US president and insisted he had the power to lift coronavirus restrictions despite the nation’s constitution leaving such rights to state governors.

During a White House news conference that ran for about two hours, the president also asserted that the federal government had “absolute power” as he fielded questions from reporters about when tough measures to stop the spread of Covid-19 could be loosened.

“When somebody is the president of the United States, the authority is total,” Mr Trump said at the daily White House coronavirus briefing.

Mr Trump’s comments came as several states announced they would band together in regional groupings to agree timeframes for lifting the orders that have effectively shuttered the US economy.

Read more here

Wuhan protest exposes tensions as retailers demand government support

Sun Yu in Wuhan

Police had to break up a protest in one of Wuhan’s busiest shopping districts after retailers demanded rent relief and greater government support for private businesses, exposing tensions in the city hardest hit by coronavirus.

The Communist party is desperate to portray the lifting of restrictions on Wuhan, where the deadly virus first surfaced, as a success.

According to official data, 97 per cent of the city’s large factories have reopened, boosting Beijing’s claim that the economic recovery is gathering pace.

But the same data reveal that just a third of small businesses are up and running, raising anxiety in a city that was brought to a standstill for 76 days.

China exports fall 3.5% on year, signalling potential rebound

Tom Mitchell in Singapore

China’s exports fell 3.5 per cent year on year in March, signalling a potential rebound for the country’s trade sector after much steeper falls in January and February due to the global coronavirus pandemic.

According to data released by China’s Customs administration on Tuesday, first-quarter exports were down 6.4 per cent year on year in renminbi terms, compared to a double-digit decline recorded during the January-February period.

The country also recorded a trade surplus of $18.5bn for the month, compared to a deficit of $7.1bn in January and February.

But Customs officials struck a cautious note as the pandemic has forced some of China’s biggest export markets to adopt widespread lockdowns that are still in place.

“With Covid-19 spreading worldwide, the global economy faces mounting downward pressure,” said Li Kuiwen, a Customs spokesperson. “Uncertainties are on the rise and China’s foreign trade is encountering bigger difficulties.”

Singapore reports record 386 new coronavirus cases

Stefania Palma in Singapore

Singapore has reported a new record daily jump in coronavirus cases, with 386 additional patients taking the country’s total to 2,918.

Most of the infections were linked to the latest cluster among the city state’s foreign worker dormitories, while 12 were connected to other patients and 94 had yet to show links to previously reported cases. None of the infections were imported.

Separately, the country’s education ministry has allowed teachers to gradually resume the use of Zoom after temporarily banning the videoconferencing app last week following virtual classroom breaches, for which authorities filed police reports.

New controls have been installed including a “security button” simplifying the app’s settings, a limit on Zoom’s features for virtual classes and a compliance form teachers are required to submit before using the app, the ministry said.

Singapore’s schools are closed under strict distancing measures running until May 4.

Zoom said it was pleased with the ministry’s decision. As part of the new measures, Zoom gave the education ministry control over teachers’ accounts to manage default security settings “in a more consistent manner”.

The limit on Zoom’s features will be lifted once educators – who are being briefed on the app’s latest updates – become more familiar with the platform, Zoom said.

China’s venture capital funding rallies after coronavirus lockdown

Mercedes Ruehl in Singapore and Ryan McMorrow in Beijing

Venture capital funding in China rebounded in March, new figures showed, as investors hunted for bargains among start-ups after the coronavirus outbreak.

Chinese start-ups and technology companies raised more than $2.5bn during the month, marking a record sixfold rise from just $410m in February, according to data from the Asian Venture Capital Journal.

The rise in activity suggested that funds had taken advantage of lower valuations resulting from the pandemic to invest in sectors including biotechnology and online education. Authorities began reopening the Chinese economy in March after managing largely to contain the country’s coronavirus outbreak.

However, venture capital financing still fell by more than half to $3.8bn in the first quarter compared with the same period in 2019 as the virus brought the world’s second-largest economy to a virtual standstill.

Read the full report here.

China reports 89 new cases, but new arrivals still dominate tally

China’s national health commission reported 89 new coronavirus cases to the end of Monday, coming in below the previous day’s tally of 108, but imported cases continue to dominate the total of new infections.

Of the new cases, 86 were found in people who had returned from overseas, while the remaining three were locally transmitted infections recorded in the southern province of Guangdong. The number of recorded coronavirus infections rose to 82,249.

China has put a limit on international flights and tightened checks on land borders in a bid to closely monitor arrivals in the country for the virus.

The northern province of Heilongjiang accounted for 79 of the new imported cases on Monday. The province has been hit by a wave of imported cases after Chinese citizens flew from Moscow to Vladivostok and used a now-closed border crossing in the province to enter China.

There were no new deaths linked to coronavirus on Monday, leaving the total number of recorded fatalities at 3,341.

There were 54 people who tested positive for coronavirus but showed no symptoms on Monday. Five of that group were returnees from overseas.

News you might have missed

The IMF will offer grants to some of the world’s poorest nations, mainly in Africa and Asia, to allow them to cover their debts to the Washington-based multilateral lender, as it ramps up the global response to the coronavirus pandemic.

Greece has banned families and groups of friends from celebrating Orthodox Easter together on April 19 after experts warned the next 10 days would be critical to keeping the country’s coronavirus outbreak in check.

The Federal Reserve is scaling back its interventions in short-term funding markets, as strains that spread across the financial system on account of the coronavirus outbreak have eased.

The governors of New York and five other mid-Atlantic states will co-ordinate on a plan to reopen businesses and schools across the region once the coronavirus outbreak is under control.

In a half-hour televised address to the nation on Monday night, a contrite President Emmanuel Macron admitted the French government had been ill prepared for the crisis. He said there were signs the pandemic was beginning to stall but extended France’s lockdown for a further month.

Wells Fargo is advising some small business clients to “apply elsewhere” in case the government’s $350bn rescue programme is fully subscribed before the bank can work through a massive backlog of applications.

A White House spokesperson on Monday insisted Donald Trump had no intention of removing Anthony Fauci, the immunologist who has become one of the most trusted faces of the US coronavirus response. Dr Fauci has become the target of partisan warfare after President Trump hinted he was considering sacking him.

Countries must exercise caution and put human health first when making decisions about lifting lockdown measures, said doctors from the World Health Organization on Monday, adding that it would be dangerous for all countries to relax rules at the same time.

Asia stocks gain ahead of China trade data

Asia stocks gained on Tuesday, despite losses overnight for US stocks ahead of the start of earnings seasons this week.

Japan’s Topix was up 0.4 per cent, the Kospi in South Korea gained 1 per cent and Australia’s S&P/ASX 200 was flat on its first day of trading after the Easter weekend.

China is set to release March trade figures on Tuesday, giving an insight into the impact of mass lockdowns on the world’s second-largest economy.

The S&P 500 closed 1 per cent lower as investors looked ahead to earnings reports from large US companies for signs of the true hit from the Covid-19 pandemic on business.

S&P 500 futures were up 0.2 per cent.

Mexican mayor places masks on statues to spread health message

Jude Webber in Mexico City

Debate rages internationally on whether the public should wear masks, but in one borough in Mexico City, mayor Santiago Taboada is taking no chances and has slapped face masks on monuments of historic figures to make his point.

Statues of 19th century President Benito Juárez as well as Mexican Revolutionary hero Pancho Villa are among the statues now adorned with face masks bearing the words: “It’s time for us all to take care of ourselves.”

An ancient giant Olmec head — a sculpture that dates back thousands of years— has also been kitted out.

Mr Taboada urged people to make their own masks and leave medical-grade equipment for health professionals.

US death toll tops 23,000, but daily tally falls for third straight day

The number of coronavirus fatalities in the US topped 23,000 on Monday, but the daily death toll fell for a third consecutive day for the first time since the outbreak began.

Over the past 24 hours, a further 1,450 people died from coronavirus, according to the latest data from Covid Tracking Project, taking the cumulative total to 23,369.

Monday marked the third day in a row the daily death toll has declined from the previous 24 hour period, and from a record 2,064 on Friday.

The increase in new Covid-19 cases, 24,948 in the past 24 hours, was the lowest daily increase since March 31, spurring hopes the outbreak in the US may have reached a peak in the days around the Easter holiday.

Coronavirus most up-to-date: India to prolong nationwide lockdown to stop of month

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The US death toll surpassed 18,000 with close to half a million confirmed coronavirus conditions on Friday, in accordance to the most recent figures from the Covid Monitoring task. Throughout the US, 1,932 folks died from coronavirus in the earlier working day — with New York, accounting for practically 43 per cent of the fatalities. New Jersey and Michigan are between the other states that are significantly really hard hit with 1,932 and 1,281 deaths, respectively. The whole range of Us citizens who have died from coronavirus because the outbreak started stands at 18,356.

More than 100,000 individuals have died from Covid-19 around the world, Johns Hopkins University in Baltimore documented. There are symptoms that the outbreak is slowing as the overall range of new situations remained secure at around 85,000 for the earlier 3 days. World wide day by day fatalities have also dropped in recent times as lockdown measures taken in Europe begin to have an result.

At the beginning of March, Asia accounted for over 60 per cent of coronavirus-associated deaths. In a week, consideration shifted to Europe, with Italy and Spain the new world wide hotspots. Though the area still accounts for extra than half of world-wide fatalities, the aim is now more and more on the US.

Gilead’s antiviral remdesivir has shown early constructive signals that it may be effective in treating coronavirus in a analyze of people offered the drug, which was initially developed for Ebola. The New England Journal of Medication published a study analysing info from just 53 individuals, which identified that about 68 for each cent enhanced right after being dealt with with remdesivir, which some gurus hope could halt the Sars-CoV-2 virus from replicating.

The US Federal Reserve Board’s supervision head, Randal Quarles, warned that non-financial institutions could deal with tighter regulation “at the time the dust settles” right after the coronavirus crisis. Addressing a digital celebration organised by the University of Utah, Mr Quarles stated regulators would assume about “no matter whether we have the correct framework all-around that (non financial institution) portion of the monetary sector simply because of the substantial total of intervention that was necessary at the outset of this”.

Italy’s primary minister, Giuseppe Conte confirmed that the countrywide lockdown, which was established to conclude on April 13, will be prolonged by three months to Might 3. Some businesses will be permitted to reopen on April 14, together with stationery outlets and bookshops.

France documented a additional 987 coronavirus deaths, but officials said they have been viewing the initially signs that the distribute of the epidemic was starting to gradual just after approximately a thirty day period of the population currently being confined. The figures contain 554 fatalities in hospitals, with the relaxation being in previous people’s houses and treatment residences. The overall dying toll is now 13,197.

Apple and Google are collaborating to make speak to-tracing instruments that would permit smartphone buyers to be alerted if they come into near proximity with someone infected by Covid-19. The two tech giants, whose iOS and Android software underlay almost all smartphones, claimed they will build technologies “to aid governments and wellbeing agencies decrease the distribute of the virus, with user privateness and security central to the design”.

Coronavirus latest: Boris Johnson ‘stable’ and ‘responding to treatment’ in ICU

Democrats set out billion-dollar emergency stimulus demands

Lauren Fedor in Washington

Top Democrats on Capitol Hill have set out a series of demands for small businesses, hospitals and state and local governments, as lawmakers prepare for a fresh round of negotiations on how to provide billions of dollars of stimulus to Americans struggling to cope with the coronavirus crisis.

Nancy Pelosi, the Democratic speaker of the House, and Chuck Schumer, the Senate’s most senior Democrat, said in a joint statement on Wednesday morning that Democrats wanted “interim emergency legislation” to include $250bn in assistance to small businesses, half of which would be channeled through smaller, community-based lenders.

Ms Pelosi and Mr Schumer called for an extra $100bn for hospitals to buy personal protective equipment and expand testing capacity, $150bn more for state and local governments and a 15 per cent increase in food stamp benefits for low-income Americans.

Their list of demands came one day after Steven Mnuchin, the US Treasury secretary, said he had spoken to both Republican and Democratic congressional leaders about securing $250bn to fund loans for small businesses hit by the coronavirus pandemic.

Covid-19 death toll in England jumps by 828 in worst day yet

The number of Covid-19 fatalities in England has risen by more than 800 in the darkest day yet of the coronavirus outbreak in the UK.

England’s death toll increased by 828 people as of Tuesday evening, according to NHS England. It marked the biggest increase to date and suggests the overall UK tally will have climbed by the most since the outbreak began.

Patients were between 22 and 103 years old and roughly 94 per cent had underlying health conditions, according to NHS England. London continued to be the hardest-hit region, reporting 201 deaths over the 24-hour period. Fatalities rose by 171 in the Midlands, 128 in the North West and 120 in the South East.

The overall UK death toll increased by 786 to 6,159 the previous day, with the number of fatalities in England increasing by 758.

US stocks rise 1% as investors assess coronavirus updates

Wall Street climbed more than 1 per cent at the open amid hopes that cases in the US are peaking and on expectations that Congress could announce further emergency support to cushion the economy.

The S&P 500 rose 1.1 per cent, while the Nasdaq Composite gained 1.2 per cent. US equities are in the midst of what looks to be another wild week. The S&P 500 jumped 7 per cent on Monday, for its biggest daily gain in a fortnight, and on Tuesday, it ended lower despite have chalked up sizeable gains earlier in the session.

Investors, this week, have have been encouraged by signs that coronavirus cases are starting to slow after governments around the world imposed sweeping restrictions on movement.

Elsewhere in markets, the yield on the US 10-year rose 0.02 percentage points to 0.7563 per cent.

Rio Tinto bucks trend with plans to pay $3.7bn dividend

Neil Hume in London

Global miner Rio Tinto will make a $3.7bn dividend payment this year bucking a trend that has seen scores of companies in Europe and North America scrap returns to shareholders because of the coronavirus pandemic.

Chairman Simon Thomson said the Anglo-Australian company had decided to hand the cash to investors because demand for its main commodity — steel-making ingredient iron ore — remained strong.

Mr Thompson told investors:

The Board debated this issue on Monday and confirmed that we will pay the dividend, as set out in our annual report.We took this decision because Rio Tinto has a strong balance sheet, our operations are running safely, and our order book for iron ore is full.

The price of iron ore has remained relatively robust this year helped by supply disruptions and also demand in China, where business is returning to normal after the virus outbreak.

Some rival miners including Glencore and Freeport-McMoRan have decided to suspend dividend payments to preserve cash and give them time to assess the impact of Covid-19 on their operations.

Rio has already paid a $2.7bn interim dividend for 2019 and returned a $1bn by way of a special dividend.

Mexico job losses threaten workers’ healthcare

Jude Webber in Mexico City

Mexico has registered almost 350,000 job losses as a result of Covid-19, with the majority of those workers also losing access to the state social security health service.

Luisa María Alcalde, labour secretary, said the job losses, which count cuts in formal employment between March 13 and April 6, were concentrated among larger companies employing more than 50 people. Smaller companies employing up to five people “have resisted and shown solidarity,” she told a news conference.

Mexico also has a large informal workforce, making up roughly half the economy, where workers pay no taxes and receive no benefits. The CCE, Mexico’s biggest business lobby, says 1.4m jobs in Mexico are at risk as Latin America’s second biggest economy is forecast to contract as much as 10 per cent.

President Andrés Manuel López Obrador called small companies “heroic” for not cutting staff and appealed to others to reconsider, saying “our god cannot be money”.

Zoé Robledo, head of the state social security institute, IMSS, said 62 per cent of the fired workers would no longer have access to the institute’s health services and appealed to employers not to fire workers because “these are health service contributions that can mean life or death” in the current coronavirus crisis.

Mr López Obrador has resisted calls from business leaders to defer taxes or provide other benefits to keep small businesses afloat during a month-long lockdown. He said he would provide 1m low-interest loans instead.

Russia and China shut land border

Henry Foy in Moscow

Russia and China have closed their land border for personnel crossings after the Heilongjiang province recorded 25 new cases of coronavirus among citizens who had recently returned from Russia.

Russia had moved to seal off its more than 4,000km border with China in late January as the coronavirus outbreak was beginning to spread globally, but has allowed certain people and goods to cross in the months since.

“All personnel passages at the China-Russia land border crossings have been temporarily closed,” the Chinese embassy in Moscow said in a statement on Wednesday.

The Russian consulate in Harbin, the capital of Heilongjiang province, confirmed the closure, and said in a separate statement that 87 cases of coronavirus in the region had been imported.

“Twenty-five new Covid-19 cases were confirmed in the Heilongjiang province in the past 24 hours,” it said in a post on social media. “All the Chinese citizens arrived from Moscow via Vladivostok and crossed the [border] in the period between March 30 and April 4.”

None of those infected were Russian citizens, it added

Global trade will shrink more than in financial crisis, WTO says

Valentina Romei in London

World trade is expected to contract more than during the financial crisis as the coronavirus pandemic upends the global economy, according to the World Trade Organization.

World merchandise trade is set to plummet by up to 32 per cent due to the Covid-19 crisis, marking a much faster contraction than the 12 per cent decline in 2009, the WTO forecasts.

“These numbers are ugly – there is no getting around that,” the organisation’s director-general said. “The unavoidable declines in trade and output will have painful consequences for households and businesses, on top of the human suffering caused by the disease itself.”

Roberto Azevêdo urged countries to “work together” to keep markets open and ensure they foster a favourable business environment to achieve a “much faster recovery”.

The nearly one-third drop in trade is calculated assuming an initial steep decline and a prolonged and incomplete recovery.

If global trade were to start recovering from the second half of 2020 and the post-crisis growth were strong enough to bring trade close to its pre-pandemic trend, the annual contraction would be milder, at 13 per cent. However, the organisation notes that, after the financial crisis of 2008-09, trade never returned to its previous trend.

Under both scenarios, all regions will suffer double-digit declines in trade in 2020, with a 41 per cent contraction for North America in the most pessimistic scenario.

Last year, global merchandise trade fell by 0.1 per cent, weighed down by geopolitical tensions and slowing economic growth.

Free to read

Analysis: Tracking coronavirus — Big data and the challenge to privacy

Nic Fildes in London and Javier Espinoza in Brussels

Mapping how populations move between locations has proved invaluable in tracking and responding to epidemics.

But the use of such data to track coronavirus has triggered fears of growing surveillance, including questions about how the data might be used once the crisis is over and whether such data sets are ever truly anonymous.

Read the full article here for free.


Boris Johnson ‘stable’ and ‘responding to treatment’ in ICU

Sebastian Payne

Boris Johnson remains in intensive care but is “clinically stable” and “responding to treatment”, the UK prime minister’s spokesperson has said.

The prime minister remains in “good spirits” during his treatment for coronavirus at St Thomas’ Hospital, London, Downing Street said in a daily press briefing.

Mr Johnson is still receiving “standard oxygen treatment and breathing without any other assistance”. Downing Street added that Mr Johnson is “not working, as he is in intensive care” but “has the ability to contact those he needs to”.

His spokesperson declined to say whether his high temperature has decreased, his cough has subsided or whether the prime minister has gone on any of the trial drugs to combat coronavirus. Mr Johnson will “continue to follow the advice of his medical team”, his spokesperson added.

On the topic of when the UK lockdown will end, No 10 said a review would be made “on or about” the three-week mark — which is just after the long Easter weekend. The spokesperson declined to say when exactly it would be announced.

There is a widespread expectation in government that the lockdown will be renewed. In Wales, the housing minister Julie James said this morning that the lockdown will continue there into next week. Ms James told the BBC there were “signs” that the stringent social distancing measures were working, but urged residents not to leave home over Easter.

The PM’s spokesperson said the UK government was not expecting to make any announcements on the lockdown today. “It is too early to say when the peak is going to be,” he said, reiterating that the government will be guided by scientific advice on when to relieve the measures.

The government also announced that 20,000 health care workers have now been tested for coronavirus. The most recent daily figures put 14,006 people being tested, which is some way off the pledge of 100,000 tests before the end of the month.

Hong Kong sets out additional $18bn relief to support economy

Nicolle Liu in Hong Kong

Hong Kong has set out an additional HK$137.5bn ($17.6bn) relief package to support the local economy hit by the coronavirus outbreak.

This is for an “unprecedented challenge” that demands an “unprecedented response” from the government, chief executive Carrie Lam said on Wednesday.

The measures include an HK$80bn wage grant to prevent layoffs. Employers can apply for a 50 per cent subsidy for each employee with a HK$9,000 upper limit for six months. The government pledged HK$21bn more on the existing HK$30bn anti-epidemic fund to provide support to specific industries.

Ms Lam added that companies who dismiss staff will be asked to pay back the subsidies or even be subject to punishment.

The city’s rail operator, MTR, which is majority owned by the government, will provide a 20 per cent discount on ticket fares from July. The government will take up half the cost.

Other policies include corporate loan guarantees, expanding civil servant recruitment, tax breaks, rent cuts on government lands and other fee waivers.
Key government officials will also take a 10 per cent salary cut for 12 months, after a recent outcry on Ms Lam’s 2 per cent pay rise.

The territory has set aside more than HK$287.5bn to boost the economy in the past months. Paul Chan, the financial secretary, said the deficit for the current fiscal year will rise to 9.5 per cent of gross domestic product.

Hospitality workers hit by service charge exclusion in support scheme

Alice Hancock in London

Tens of thousands of workers in the UK hospitality industry face receiving only half their wages from the government’s coronavirus job support scheme after the tax authority said service charge would not be included.

The charge, usually 12 to 15 per cent of the total that is added to bills in hotels and restaurants, is paid directly to employees through a system known as tronc. It usually comprises between 30 and 50 per cent of waiters’, chefs’ and sommeliers’ pay.

Unlike cash tips, which typically go straight to employees without being taxed, service charge is taxed and declared through a company’s payroll system, even though the employers do not touch the money.

List of countries attending the G20 emergency meeting on oil

David Sheppard in London

The provisional list of countries planning to attend the G20 emergency meeting on the oil market has emerged, with most of the largest members planning to have ministers dial in to the online gathering.

The meeting, set for Friday, is part of efforts to find a way to reduce supplies and support a market that has been overwhelmed by the collapse in demand caused by the coronavirus pandemic, which is suspected of having reduced global consumption by as much as a third.

The meeting will come after a gathering of the so-called Opec+ group on Thursday, with members such as Russia pushing for wider participation from oil producers outside the group, amid warnings the world could quickly run out of storage and be forced to shut in fields, potentially with long-term consequences for supplies.

Saudi Arabia, which holds the rotating G20 presidency this year, helped organise the meeting in conjunction with the International Energy Agency, which was established by oil consuming countries in the 1970s.

US President Donald Trump has said he believes Saudi Arabia and Russia will end their price war and agree a cut of as much as 15m barrels a day, or about 15 per cent of pre-crisis output.

The US has made no commitment to make formal cuts, but it is suspected that it could highlight forecast production falls – caused by lower prices – from its own industry as a contribution. Other countries where the private sector makes up the majority of their energy industry are expected to be asked to make similar contributions, such as pointing to the sharp drop in capital expenditures already announced by publicly listed energy companies.

Importing countries without significant oil industries, such as Germany, may be asked to buy up crude or refined fuel for their strategic stockpiles to provide additional support to the market.

Here is a provisional list of attendees for the G20 emergency meeting, according to people familiar with the matter:

Scottish death toll is higher than previous records show

Mure Dickie in Edinburgh

Deaths from coronavirus in Scotland are higher than previously captured by health boards, government data revealed on Wednesday, as controversies stack up around the world about the accuracy of officially reported cases.

There were 366 deaths in Scotland by April 6, up 70 from the previous day, according to data released by the government using a revised methodology.

Separately, the National Records of Scotland said there had been 354 deaths in Scotland by April 5 where coronavirus was mentioned on the death certificate.

The new NRS figure is intended to complement the daily data from government agency Health Protection Scotland that records deaths in hospitals among those who have a laboratory-confirmed coronavirus infection.

The NRS said 60 per cent of all deaths involving Covid-19 were of people aged 75 or over

EU says top scientist was asked to resign by ERC committee

Javier Espinoza in Brussels

Mauro Ferrari, the EU’s top scientist, was asked to resign from his post by the members of the European Research Council, an EU spokesman said on Wednesday. The person gave no further details on the reasons behind their request.

“There was a vote on March 27 by the ERC’s other 19 members who requested the resignation of Mr Ferrari,” the spokesman said.

The spokesman added Mr Ferrari quit by email on Tuesday and his resignation took immediate effect.

He said the EU “regrets his resignation”, which comes at a crucial stage of the fight against the coronavirus pandemic.

Launched in 2007, the ERC is aimed at funding the bloc’s best scientists and it is one of the world’s most prestigious funding agencies with a budget of about €2bn a year.