Coronavirus latest: US oil recovery stalls amid weaker fuel demand


Christine Lagarde says women leaders outperformed in pandemic

Martin Arnold in Frankfurt

Women leaders have outperformed in the pandemic, European Central Bank president Christine Lagarde said, citing the better communication and decision-making by female heads of state in Germany, Taiwan, Belgium and New Zealand.

“Women tend to do a better job,” said Ms Lagarde. “It’s quite fascinating actually, when you look at those countries that were led by women and the path they took and the policies they adopted and the communication style that was in play was quite stunning.”

Speaking on a video interview with the Washington Post on Wednesday, Ms Lagarde praised the way that German chancellor Angela Merkel had handled the pandemic, breaking with the tradition that the ECB president avoids singling out particular countries or leaders.

“When I look at what Chancellor Merkel has done here, she very, very transparently shared data, numbers, casualties and rate of contaminations and so on,” said the ECB president, after saying she was speaking in a personal capacity rather than as a central banker.

Ms Lagarde — whose appointment to the ECB last year was instigated in a deal struck by the German chancellor — said women leaders were better at expressing the “caring dimension” and “that was something that was considered by viewers and votes as well as authentic”.

“I was also thinking of those other leaders around the world — you look at the leader in Taiwan, in Belgium in New Zealand — many of those leaders, prime ministers or presidents have also communicated well and carried the water of bad news as well as the water of clear explanation and strong recommendations.”

Asked whether she feared the eurozone could suffer a double-dip recession in a “W-style” recovery, Ms Lagarde said this was unlikely unless there was a major second wave of coronavirus infections that forced national lockdowns to be reimposed. She added that the recovery would be “uneven” and that data seen so far indicated that the ECB’s baseline projection for an 8.7 per cent decline in the eurozone economy was “probably in the right place”.

Catalonia reports 721 new cases as region contends with outbreak

Ian Mount in Madrid

Catalonia reported an additional 721 cases of Covid-19 Wednesday, as the region in northeastern Spain fought to contain the country’s two largest outbreaks. Almost three-quarters of the new cases were in the Barcelona metropolitan area.

The number of new cases are in line with those of recent days.

The Generalitat — Catalonia’s regional government — has been fighting growing outbreaks both around Barcelona and in Segrià, an agricultural region of 200,000 people that includes the provincial capital of Lleida, where a limited outbreak in slaughterhouse and fruit-picking workers has expanded in the broader population.

Last week, the Generalitat last week decreed new restrictions in Segrià, including prohibitions on non-essential travel between some towns, meetings of more than 10 people, and restaurant table service. Similar restrictions on meetings were put in place in the Barcelona metropolitan area.

National health minister Salvador Illa said on Wednesday that Spain had 224 active outbreaks — that is, a group of three or more linked cases — encompassing 2,622 cases overall. “The majority are linked to the fruit harvest, family activities or nightlife,” he told Spanish parliament.

On Tuesday, the Generalitat’s new secretary of public health, Josep Maria Argimon announced that the regional health service would hire 500 new case trackers and could triple daily coronavirus testing rates — the region runs an average of 8,000 tests daily but has a capacity of 24,000 — as it increases testing of close contacts of known cases.

US oil recovery stalls amid weaker fuel demand

Derek Brower in London

US crude stockpiles rose unexpectedly last week and fuel demand dropped sharply, as mounting coronavirus cases and renewed shutdowns in some states stalled a recovery in the country’s oil market.

Commercial stocks of crude oil rose to almost 540m barrels, up less than 1 per cent but bucking the trend of falling inventories in recent weeks, according to data released on Wednesday by the federal Energy Information Administration.

Products supplied to the market — the EIA’s measurement of domestic fuel demand — dropped by more than 800,000 barrels a day compared with a week earlier, to 17.7m b/d. The four-week average of demand shows it down by 15 per cent compared with last year. Petrol demand fell by almost 100,000 b/d last week, to 8.6m b/d.

Crude imports rose by almost 400,000 b/d to 5.9m b/d, reflecting the fall in US supply triggered by the oil-price crash. Shipments from Saudi Arabia, which had hit a high of almost 1.6m b/d in May as an armada of oil tankers sent during the country’s springtime price war arrived in the US, fell sharply. At less than 500,000 b/d last week, Saudi imports are now back within longer-term historical range, marking the end of the kingdom’s export surge to the US.

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US existing home sales jump by most on record in June

Sales of previously owned homes rebounded by the most on record in June following three consecutive months of declines as coronavirus lockdowns weighed on housing activity during the key spring selling season.

US existing home sales climbed 20.7 per cent to an annualised pace of 4.72m last month, the National Association of Realtors said. That was shy of economists’ expectations for a 24.5 per cent rise to 4.78m units. However, sales remained down 11.3 per cent from a year ago.

Each of the four major regions saw sales grow on a month-over-month basis, led by the west.

“The sales recovery is strong, as buyers were eager to purchase homes and properties that they had been eyeing during the shutdown,” said Lawrence Yun, chief economist at NAR. “This revitalisation looks to be sustainable for many months ahead as long as mortgage rates remain low and job gains continue.”

Record low mortgage rates have helped fuel the recovery in the US housing market, with the average interest rate on a 30-year fixed-rate mortgage falling below 3 per cent for the first time ever, mortgage finance company Freddie Mac said last week.

Moreover, economists have noted the coroanvirus crisis has largely affected younger renters as opposed to would-be homebuyers.

Indeed, Mr Yun said home prices climbed during the coronavirus lockdowns “and could rise even further due to heavy buyer competition and a significant shortage of supply.”

US stocks buck European trend as S&P 500 and Nasdaq rise

US stocks bucked moves from their counterparts elsewhere after a busy European morning when an escalation in the diplomatic row between China and the US prompted the renminbi to strengthen against the dollar.

The S&P 500 gained 0.3 per cent soon after Wall Street opened. The technology-heavy Nasdaq followed suit as its buoyant mood helped it skirt round a record close struck this week, putting its advance for the year at almost 20 per cent.

Meanwhile, in Europe the region-wide benchmark index shed about 1 per cent. That places the Stoxx Europe 600 on course to break a three-session winning streak.

President Donald Trump added to Covid-19 gloom when he said on Tuesday that the tally of coronavirus cases in the US would “get worse before it gets better”, a comment taken as an acceptance on his part of the severity of the pandemic that he previously said would “just disappear”.

The dollar pushed above 7 against the Chinese currency after the US asked Beijing to shut its consulate in Houston and local media reports showed what appeared to be consulate staff burning documents. The renminbi later trimmed those gains to break back below 7 to a dollar.

Beijing immediately condemned President Trump’s move and warned it would retaliate unless the US rethought its decision.

“This is an escalation of degree rather than of kind,” said Tom Holland from Gavekal in Hong Kong. “Senior US administration officials have been getting increasingly more open and active in their criticisms of China.”

This week’s visit to London by Mike Pompeo, the US secretary of state, was among a number of factors that appeared to be aimed at marshalling support for the US stance against Beijing, Mr Holland added.

Baker Hughes prepares for continued ructions in oil and gas sector

Myles McCormick in London

US oilfield services group Baker Hughes said it was battening down the hatches in anticipation of a fresh surge in coronavirus cases that could prompt renewed lockdowns and leave activity in the sector depressed for the rest of the year.

The group — whose revenues slid by a fifth in the second quarter — said that while the worst of the economic blow from Covid-19 had likely passed it was continuing to slash costs as it prepared for the volatility in the oil and gas industry to last through to the end of the year.

“Although the majority of lockdowns have been easing globally and economic activity likely troughed during the second quarter, visibility on the economic outlook remains extremely limited,” said chief executive Lorenzo Simonelli. He added:

More specifically, the risk of a second wave of virus cases, the reinstitution of select lockdowns, and the risk of lingering high unemployment creates an uncertain economic environment that likely persists through the rest of 2020.

Mr Simonelli’s comments came as the group reported revenues of $4.7bn for the three months to June, down 20 per cent on last year. It recorded a net loss of $201m compared with a loss of $9m in the same period in 2019.

The figures were broadly in line with the expectations of analysts. Shares were unmoved in pre-market trading.

Free cashflow and adjusted operating income — non-GAAP measures closely watched by the sector — were down 82 per cent and 71 per cent respectively, compared with last year, underlining the extent of the slump in services activity.

Oilfield services groups, which do everything from drilling wells to installing pipes for producers, have been the worst hit by the crash in the oil market, accounting for the majority of the layoffs in the sector.

US oil prices plunged into negative territory in April causing activity in the sector to seize up. They have since bounced back, but at about $40 a barrel they remain too low for most companies to return to drilling.

US strikes $2bn deal to secure vaccine supply

Joe Miller in Frankfurt and Clive Cookson in London

The Trump administration has committed to spend $1.95bn on 100m doses of a potential Covid-19 vaccine being developed by Germany’s BioNTech and US pharma group Pfizer, which will be distributed free of charge to American citizens.

The first large-scale supply agreement signed by the White House also includes the option for the US government to purchase a further 500m doses.

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Melrose shares tumble 20% as pandemic wreaks havoc on business

Michael Pooler

Melrose Industries’ share price sank by one-fifth after the FTSE 100 buyout specialist revealed the extent of the damage wrought on its automotive and aerospace components businesses by the Covid-19 pandemic. 

The London-headquartered company, which acquired car and aircraft parts maker GKN in a £8bn hostile takeover more than two years ago, said it was seeking further cost savings involving job cuts following a 27 per cent slump in revenues during the first six months of 2020. 

After falling into losses in the second quarter of the year, Melrose said in a trading update on Wednesday that it had rebounded to breakeven on an adjusted operating profit basis in June as the recovery began to take hold.

Analysts welcomed the company’s free cash flow, which was about £200m before restructuring costs and an acquisition. This reduced net debt, which stood at £3.28bn at the end of 2019, by about £90m.

However, investor worries about the size of the blow from coronavirus became evident as the stock dropped 20 per cent to 95.6p, giving a market capitalisation of £4.86bn. 

“It is clear that our, and consensus, expectations on the impact of Covid-19 were too optimistic,” wrote house broker JPMorgan, which slashed its annual earnings forecast for Melrose by almost two-fifths.

Gold advances to nine-year peak as dollar and yields weaken

Harry Dempsey in London

Gold pushed higher to hold fast a nine-year high as the dollar slides and real yields from bond investments hit rock bottom.

The price of the precious metal rose 0.7 per cent to $1,854 a troy ounce on Tuesday, its highest level since September 2011 and accelerating gains since mid-March to 26 per cent.

The US currency has fallen about 5 per cent against a basket of currencies since mid-May as concerns grow about the economic recovery. The coronavirus pandemic has escalated its spread through the world’s largest economy while investors flocked to the euro as EU leaders agreed on a stimulus package.

Rising precious metal prices come as the real yield on 10-year Treasury bond fell to a low of -0.87 per cent at market close on Tuesday, analysts at MUFG said. Bond yields move inversely to the price.

Investors are looking for real assets that store value, said Nadège Dufossé, head of cross-asset strategy at Candriam, as governments expand budget deficits helped by central banks lowering interest rates and purchasing bonds.

“The bond part is no longer a good hedge for the equity part. Everything is very expensive, cash is not bringing any return,” she said. “Investors have to reconsider traditional allocations so adding gold can be a good idea.”

Bernard Dahdah, senior commodities analyst at Natixis, said that the prospect of another economic contraction in Europe as furlough schemes are removed and the disparity between production and consumption in China added to the bullish mood.

Some strategists said that gold would need a further tranche of support to break through its all-time high of $1,920 a troy ounce.

Any decision by China to peg its currency to the metal and reduce reliance on the dollar could fuel demand for gold.

“Having secured control over Hong Kong, I believe that China will fairly soon move to offer a gold-renminbi exchange standard,” said Charles Gave, founding partner at Gavekal Research. “A tactical question for China is whether it holds fire on this plan until the effect of western economies monetizing huge deficits plays out.”

Silver prices extended its gains to sustain a six-year high. They added 1.5 per cent at $21.64 an ounce, as hopes of a recovery from the pandemic and loose monetary policy lift demand.

Global stocks slide as US and China clash over diplomacy

Sarah Provan in London and Hudson Lockett in Hong Kong

Global stocks stumbled and the renminbi retreated after diplomatic tension escalated between the US and China.

The renminbi retreated 0.4 per cent to above 7.0107 a dollar in trading within mainland China, and by almost 0.6 per cent on foreign trading hubs where it is allowed to fluctuate more freely. It earlier had hovered around a four-month high. The onshore and offshore rates climbed back above 7 a dollar.

The US requested China to close its consulate in Houston, heightening the dispute between the world’s biggest economies. Beijing “strongly condemned” the request on Wednesday, with the foreign ministry urging Washington to rethink its decision. Neither Beijing nor Washington offered an explanation for the closure of the consulate.

Ken Cheung, chief Asian foreign exchange strategist at Mizuho Bank, said the swerve past the Rmb7-per-dollar threshold reflected a sudden spike in investor concerns over US-China relations in the wake of a “quite strong” response from China’s foreign ministry to the Houston consulate eviction.

“This kind of [development] involves a lot of uncertainty”, he added, noting that markets appeared to be pulling back from harsher bets against the Chinese currency as they await more details on the situation.

Other global assets took some heat from the row between the superpowers. Europe’s Stoxx 600 fell 1 per cent by mid-morning on Wednesday, easing off a four-month high. US stock futures mirrored the decline to an extent as S&P 500 futures fell 0.5 per cent away. In London, the FTSE 100 took a 0.7 per cent hit, while Frankfurt’s Dax index retreated from wiping out its losses for the year with a 0.5 per cent drop.

Mainland China’s CSI 300 of Shanghai and Shenzhen-listed shares was the one exception among Asian stocks as it earlier closed 0.5 per cent higher. The index has risen 15 per cent this year.

DMGT delays major oil and gas event for a year

Media and conferences group DMGT has postponed its major oil and gas event ADIPEC, due to be held in Abu Dhabi, for a year.

ADIPEC, which DMGT calls the world’s largest oil and gas event, was scheduled to be held in November but will now not go ahead until November 2021, the group said.

“This is despite strong bookings for the event and is in compliance with a directive from Abu Dhabi’s Department of Culture and Tourism that extends a ban on all events in the emirate,” DMGT announced on Wednesday.

Conference businesses have been trying, during the pandemic, to move their events online to retain delegates, speakers and brand recognition. But DMGT said this would be mostly impossible for ADIPEC because of its large size.

It is in the best interests of all parties that DMG events runs well-attended shows. The ADIPEC exhibition usually hosts thousands of exhibitors from around the world, featuring over 40,000 products and services, and is of a scale that makes it impossible to successfully virtualise.

DMGT will however move some events associated with ADIPEC, such as awards and conference programmes, online in November this year.

“They are not expected to generate significant revenues” DMGT cautioned.

The group said its insurance policies would mostly cover losses that amount from postponing ADIPEC, although about £3m of costs would still be incurred.

Iran warns outbreak to worsen in coming months

Monavar Khalaj

Iran’s President Hassan Rouhani warned the coronavirus pandemic will worsen in the coming months as the country’s fatality count has continued rising.

“Our scientific predictions estimate more hospitalisations in the coming months compared to the previous months,” said Mr Rouhani on Wednesday in the weekly cabinet session. “We must get medically ready as our estimates show the burden of this illness will get heavier.”

He urged Iranians to change their lifestyle and hold off on mourning or wedding ceremonies for now should they want to overcome the Covid-19 pandemic in the country.

Kianush Jahanpur, a senior official at Iran’s health ministry, on Wednesday urged people to take preventive measures notably a fresh campaign to wear face masks more seriously.

“If this campaign fails to form a broad public participation, the figures of casualties could multiply within the next two months and the country would face a human crisis regarding the coronavirus” in November, he said.

The death toll reached 14,853 in total on Wednesday out of 281,413 individuals who tested positive, making Iran the worst-hit country in the Middle East in terms of fatalities.

German drug group Evotec wins $18m contract from US government

Anna Gross in London

German drug discovery company Evotec Biologics has been awarded an $18.2m contract by the US government to supply lab-produced antibodies to treat Covid-19, the company announced on Tuesday.

The US Department of Defense has asked the company’s Seattle subsidiary to provide monoclonal antibodies – antibodies that are made by identical immune cells cloned from a parent cell – which will be used to develop treatments for Covid-19.

Evotec said it will design a highly efficient process to manufacture monoclonal antibodies that target the Sars-Cov-2 virus.

The company’s share price rose almost 5 per cent towards a one-month high in early trading on Wednesday.

“It is an honour to be working with the Department of Defense on this important and time-critical programme,” said James Thomas, executive vice president at Evotec Biologics. “The response to Covid-19 requires the application of rapid, flexible, scalable and robust development and manufacturing technologies.”

European corporate news round-up

Kingfisher, the owner of B&Q, reported a 21.6 per cent rise in like-for-like sales in its second quarter to date, as consumers bought goods to help them spruce up their homes during the lockdowns. The outlook for the remainder of the year was upbeat due to the “strong demand for home improvement”, it said.

Swiss engineering group ABB reported earnings slipping by a fifth to $651m, ahead of expectations thanks in part to improved margins in its motors, drives and transmissions business unit.

Soft drinks producer Britvic reported a 16.3 per cent decline in revenues to £328.9m in its fiscal third quarter, as out-of-home consumption of drinks sank with coronavirus restrictions in place. It kept guidance for a £12-18m hit to adjusted earnings before interest and tax per month, as the outlook remained uncertain despite restaurants, bars and pubs reopening.

Antofagasta, the south American copper miner, said that production would come in at the lower end of its guidance to output 725-755,000 tonnes of the industrial metal, even as only two-thirds of its workforce are working on site.

Bus operator Stagecoach said that it expects a “lasting effect” of Covid-19 on travel patterns, as its revenues fell by a quarter to £1.41bn and earnings dropped to 13.5p per share from 19.3p in its financial year to May.

European stock futures decline as Covid-19 sentiment darkens

Stock futures in Europe fell while global equities stalled, as persistent fears over the worsening coronavirus caseload in the US and the effects on the economy darkened sentiment while any initial exuberance from Europe’s coronavirus recovery plans waned.

Futures shadowing Europe’s Stoxx 600 dropped 0.4 per cent while those for the FTSE 100 shed 0.2 per cent. The European index closed at the four-month high of 376.7 points on Tuesday. It was last at this height in early March just as the continent was imposing lockdown restrictions to stem the spread of Covid-19.

US and European stocks were initially boosted by EU agreement on a €750bn recovery fund and the pledge that the Republican leader in the US Senate would back more direct payments to American families, raising hopes of further fiscal stimulus.

President Donald Trump’s warned the US coronavirus outbreak is likely to worsen. Mr Trump said late on Tuesday that the surge in Covid-19 cases in the US would “get worse before it gets better”, in what investors interpreted as a change in the president’s view on the severity of the outbreak. Infections in California surpassed 400,000 while caseloads in other sunbelt states have spiked in recent weeks.

In London, meanwhile, the UK government has given up any hopes of tying up a US-UK trade deal before the US presidential election in November. Prime minister Boris Johnson had pinned his hopes on a fast-track agreement by late summer.

South Korea pulls back on stock market capital gains tax plan

Song Jung-a in Seoul

South Korea has scaled back its plan to impose capital gains taxes on stock investments after President Moon Jae-in stressed the need to prop up the stock market battered by the coronavirus pandemic.

The finance ministry on Wednesday proposed taxes of up to 25 per cent on annual capital gains of more than Won50m ($42,000) a year for retail investors from 2023. The government planned in June to impose the taxes on capital gains exceeding Won20m.

The revised tax code is aimed at “overcoming the economic crisis quickly,” finance minister Hong Nam-ki said on Wednesday, as the worsening pandemic pummels growth in Asia’s fourth-largest economy.

Under the latest proposal, the government plans to cut stock transaction taxes gradually from 0.25 per cent to 0.15 per cent by 2023.

The government is keen to channel abundant liquidity into the stock market from the red-hot property market amid record-low interest rates.

Local retail investors have poured a record Won30tn into the local stock market in the first half of this year to boost the benchmark Kospi composite index up more than 50 per cent from a trough in March.

The revised capital gains tax proposal will affect 150,000 investors, or the top 2.5 per cent of all stock investors, according to the ministry.

EU pandemic package stokes rule-of-law dispute

Michael Peel in Brussels, Valerie Hopkins in Budapest, Guy Chazan in Berlin and James Shotter in Warsaw

Hungary’s prime minister, Viktor Orban, hailed a big win after EU leaders emerged from four days of gruelling talks with a deal for a €750bn coronavirus recovery package.

Mr Orban insisted he had won a “huge victory” by stopping an effort to make cash handouts dependent on good governance, thwarting those who view him as an authoritarian menace.

While his take is disputed by others in the EU, the compromise struck in the early hours of Tuesday has left open the question of whether the 27-country bloc has the appetite or tools to take on those member states accused of sliding into autocracy.

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Oil industry scales back exploration worldwide

Anjli Raval in London

Oil exploration is an expensive and risky business that can take years and billions of dollars of investment. As cost pressures mount and demands on companies to act on climate change grow, this segment of the industry is coming under intense scrutiny.

Once the most glamorous aspect of the oil business, exploration is now one of its most controversial. Environmentalists and some activist investors — especially in Europe — are pushing oil companies to shrink their legacy fossil fuel businesses, stop their search for new acreage and focus instead on lower-carbon technologies and alternative sources of energy.

That was the case before coronavirus sent the global economy into its worst crisis since the Depression, with the industry now wondering what the pandemic’s longer-term impact on oil demand — which stood at close to 100m barrels a day last year — will be.

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Global stocks fall after Trump warns on US virus outbreak

Daniel Shane in Hong Kong

Global stocks stalled with sentiment darkened by US President Donald Trump’s warning that the country’s coronavirus outbreak is likely to worsen.

Japan’s Topix index slipped 0.4 per cent in early Asia-Pacific trading on Wednesday, while Australia’s S&P/ASX 200 fell 1.2 per cent. Hong Kong’s Hang Seng was off 0.2 per cent.

Mr Trump said late on Tuesday that the surge in Covid-19 cases in the US would “get worse before it gets better”, in what investors interpreted as a change in the president’s view on the severity of the outbreak.

California confirmed that infections in the state had surpassed 400,000 while caseloads in other sunbelt states have spiked in recent weeks.

US and European stocks were initially boosted by news that EU leaders had agreed a €750bn recovery fund and that the Republican leader in the US Senate would back a new round of direct payments to American families, raising hopes of further fiscal stimulus.

Wall Street’s S&P 500 closed up 0.2 per cent, notching its third day in a row of gains, led by energy and financial companies. Europe’s Stoxx 600 added 0.3 per cent.

Futures trading tipped the S&P 500 to gain 0.3 per cent when US trading begins later on Wednesday, while London’s FTSE 100 was set to fall 0.1 per cent.

The one exception in Asia was mainland China’s CSI 300 of Shanghai- and Shenzhen-listed shares, which gained 1.4 per cent. The onshore-traded renminbi strengthened as much as 0.2 per cent to 6.9657 per dollar, or about a four-month high.

Traders said Chinese shares had been boosted by an anticipated announcement later on Wednesday regarding the rebalancing of the benchmark Shanghai Composite, which is expected to make the index more technology-focused.

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Russia races for vaccine as Covid-19 nonchalance spreads

Henry Foy in Moscow

At a trendy wine and tapas bar in central Moscow, the official rules mean that customers are supposed to be kept 1.5 metres apart.

But each day, officials from the local city administration headquarters around the corner squeeze into tightly packed tables, and sit shoulder-to-shoulder for lunch.

“If they don’t follow the rules, then I guess nobody needs to,” says Anton, the head waiter, as he gestures to a veranda busy with people sipping white wine as dusk settles. He shrugs. He is the only person on the premises wearing a face mask.

Ever since the mayor of Russia’s capital hastily lifted coronavirus quarantine rules six weeks ago in order to allow President Vladimir Putin to conduct a national vote on a new constitution on July 1, Muscovites have taken that proclamation to heart.

Bars buzz with drinkers and rush hour metro trains are packed despite Moscow recording about 600 new Covid-19 infections daily out of about 6,000 nationwide.

The Kremlin is now pinning its hopes on a fast-tracked coronavirus vaccine as a means to stop the virus from continuing to spread through its population and inflicting further damage on its struggling economy.

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AIIB to lend Pakistan $250m to boost post-Covid-19 economy

The Asian Infrastructure Investment Bank has approved a $250m loan to Pakistan to “strengthen its response to the social and economic fallout” from the Covid-19 pandemic

The loan, financed jointly with the World Bank, will be used to “stimulate investment in human capital, expand social safety nets, improve the country’s emergency health infrastructure and foster economic growth”, the Beijing-based lender said in a statement.

“The pandemic has rapidly evolved in Pakistan and now threatens to undo many of the hard-won gains made in reducing poverty over the past two decades,” said Konstantin Limitovskiy, AIIB’s vice president of investment operations.

AIIB said it has approved $750m in loans and grants to Pakistan since the pandemic began.

Chicago’s sports teams in push to wear face masks

Chicago’s eight major-league sporting teams have joined forces to urge the wearing of masks, as the third-largest metropolis in the US fights a surge of new coronavirus infections.

The NFL’s Bears, NHL’s Blackhawks, NBA’s Bulls, the Cubs and White Sox baseball teams, Chicago Fire FC, and two women’s teams — the Red Stars in soccer and basketball’s Sky — launched a campaign on Tuesday aimed at promoting the wearing of masks among the city’s youth.

“We encourage Bears fans everywhere to continue wearing masks to best protect the health and safety of everyone,” said team president and chief executive Ted Phillips. “Together, we can fight this pandemic.”

Chicago has experienced a rise in cases to more than 200 a day over the past week. Mayor Lori Lightfoot on Monday tightened access and capacity restrictions on restaurants, bars and gyms, reversing earlier relaxations.

Since June 15, almost 30 per cent of new cases in Chicago have emerged in people aged 18 to 29.

Australia struggles to rein in latest Covid-19 surge

Jamie Smyth in Sydney

Australia is struggling to control a second wave of Covid-19 with the state of Victoria reporting a record 484 cases on Wednesday and infections spreading to more than 40 aged care homes.

The surge in cases in Melbourne — the nation’s second most populous city — has led to the re-imposition of strict social distancing rules and mandating the wearing of face masks in large parts of Victoria.

Several prisons were placed in strict lockdowns this week after a corrections officer tested positive for the virus and new restrictions placed on care home workers in a bid to halt the spread of Covid-19 in vulnerable settings.

Daniel Andrews, Victoria’s state premier, pictured, said the rapid spread of the virus was being enabled by the failure of people to follow rules and isolate immediately when they felt sick.

“Nearly 9 in 10 — or 3,400 cases — did not isolate between when they first felt sick and when they went to get a test,” he said. “People have felt sick, they’ve got symptoms, and they’ve kept going shopping. They’ve kept going to work.”

The total number of Covid-19 cases in Victoria is 6,738, which is more than half the nation’s number of infections. Australia successfully suppressed the spread of Covid-19 by rapidly implementing border closures and social distancing restrictions when the virus first began spreading in late February.

But earlier this month breaches in hotel quarantine for returning residents in Melbourne were identified as the main cause of a surge in new cases and the start of community transmission of the virus in the state.

The borders between Victoria and other Australian states have been shut to stop the spread of the Covid-19. But several outbreaks in New South Wales have been linked to travellers from Victoria, raising concerns among health officials that community transmission could spiral out of control. NSW reported 16 new cases on Wednesday.

“The next few weeks are the most critical in NSW since the lockdown earlier in March and April,” said Gladys Berejiklian, the NSW premier.

“If we can get on top of the community transmission at this stage, we have a much better chance of continuing the move forward in a positive way, but the next few weeks are critical,” she said. “We are not out of the woods by any stretch, quite the opposite.”

San Francisco plans post-virus homeless shelter expansion

San Francisco’s mayor said on Tuesday the city would create 6,000 additional shelter places in the next two years, to ensure homeless people moved indoors during the Covid-19 pandemic are not returned to the streets.

The city would have to acquire or lease new space for 1,500 homeless people to live, mayor London Breed said in statement.

Ms Breed said the programme would be the largest expansion of shelter for the homeless in 20 years.

At least 48 homeless people, including several who tested positive for Covid-19, died between March and May in San Francisco, more than three times the 14 deaths recorded during the same period last year.

Quarantine exemptions blamed for surge in Hong Kong cases

Primrose Riordan and Nicolle Liu in Hong Kong

A convoluted system of quarantine exemptions, including allowing executives of listed companies to freely enter Hong Kong, has been blamed for a third wave of coronavirus cases sweeping the Asian financial hub.

The surge in cases, which doctors said was the city’s worst outbreak since the beginning of the pandemic, has also been attributed to the relaxation of social distancing restrictions and low testing rates.

After initially winning praise for controlling the virus without a lockdown, the number of cases in Hong Kong has soared by about 40 per cent since July 5 to almost 2,000 cases as of Tuesday. The territory has until now avoided the worst effects of the virus through the swift adoption of face masks, working from home and border controls.

But virologists said pressure from the business community to prevent the city’s economy from shutting down led the government to grant exceptions to quarantine for certain groups and the relaxation of social distancing measures. The result, the virologists said, was a new outbreak that is “out of control”.

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South Korea quarantines 1,000 troops following outbreak

Edward White in Wellington

The South Korean military has ordered almost 1,000 troops into self-isolation amid concerns some have come into contact with a group of frontline soldiers infected with coronavirus, sparking fears over a new outbreak in barracks.

At least eight soldiers who were part of a frontline unit tested positive for coronavirus this week, a military spokesperson confirmed.

The unit was based at Pocheon, which is north-east of Seoul and near the country’s heavily fortified border with North Korea.

General Robert Abrams, who leads the 28,500 US troops stationed in South Korea to assist with defence against North Korea, on Monday credited the “remarkable record” of the United States Forces Korea in stopping the spread of the virus on its massive bases.

The USFK has seen a total of 98 confirmed cases since the outbreak began, but 74 of those have been people arriving from overseas and 24 infected locally, Gen Abrams said. The USFK’s last case of local infection was reported on April 13.

Separately, the Korea Centers for Disease Control reported 63 new coronavirus cases on Wednesday, taking the country’s total to 13,879.

South Korean health officials continue to urge caution over the potential for new clusters emerging, despite the country’s relative success in suppressing the virus without a nationwide lockdown.

New York City distributes 100m meals during pandemic

New York City’s “Covid-19 food tsar”, Kathryn Garcia, said on Tuesday that more than 100m free meals had been distributed to needy families during the coronavirus lockdown.

The free food was supplied under the city’s Emergency Home Food Delivery Program, which was launched in March. The programme employed licensed taxi and limousine drivers to bring food to New Yorkers who could not leave home or afford private delivery options.

“I hope the federal government will support us in continuing this effort as long as need among seniors and the most vulnerable New Yorkers persists, whether through reimbursements for food distributed or through new benefits,” said Ms Garcia, who is head of the city’s sanitation department in addition to her pandemic responsibilities.

China reports 9 further coronavirus cases in Xinjiang

Health authorities in China reported nine more Covid-19 cases in Xinjiang, taking the total in the region to 64.

The new cases in the western region that’s home to the Uighur minority group take the number of people there diagnosed with Covid-19 over the past week to 64.

Strict measures have been put in place to limit the spread of the virus, including locking down some residential compounds.

Five imported cases were also reported for Tuesday. China on Tuesday demanded all air travellers produce a negative coronavirus test before boarding flights to the country.

The new cases take the country’s official Covid-19 tally to 83,707.

Airline chiefs urge Covid-19 testing on transatlantic flights

Bethan Staton in London

US and European airlines wrote to the White House and EU on Tuesday, urging co-ordinated coronavirus testing to restore transatlantic flights.

The chief executives of United Airlines, Lufthansa Group, American Airlines and IAG, which owns British Airways, called on US vice-president Mike Pence and EU commissioner for home affairs Ylva Johansson to act as the industry struggles to recover from the effects of the pandemic.

The airlines said they wanted US and European governments to adopt a co-ordinated Covid-19 testing programme for transatlantic flights, in order to “enhance safety and build confidence in critical transatlantic passenger air services”.

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Asia-Pacific equities dip after Trump warning on US outbreaks

Stock markets in Asia-Pacific retreated on Wednesday after US president Donald Trump warned that the coronavirus pandemic in the US would “get worse before it gets better”.

Japan’s Topix was down 0.2 per cent, the Kospi in South Korea edged up 0.1 per cent and Australia’s S&P/ASX 200 shed 0.7 per cent. Futures tip the Hang Seng in Hong Kong to dip 0.3 per cent.

Mr Trump’s comments came as California’s coronavirus tally rose above 400,000 as parts of the US suffer a resurgence in infection.

His assessment overshadowed optimism seen in European markets on Tuesday following a deal reached by EU leaders on a €750bn rescue package. The continent-wide Stoxx 600 ended 0.3 per cent higher and Germany’s Dax added 1 per cent.

In the US overnight, the S&P 500 rose 0.2 per cent, while a retreat for technology shares sent the Nasdaq Composite 0.8 per cent lower.

Investors are watching for details of further US stimulus, especially whether this will include another round of direct payments to American families. Mitch McConnell, the Republican leader in the Senate on Tuesday backed another round of payments.

S&P 500 futures pointed to a 0.3 per cent gain when Wall Street reopens.

NFL tells players it has cancelled its preseason games

The US National Football League told its players on Tuesday that there would be no preseason games ahead of the 2020 season.

In a notice on the NFL website, the NFL Players Association told its members of the cancellation during a conference call one day after the league proposed a one-game preseason slate.

Previous preseason schedules have consisted of four games for each team.

US new coronavirus deaths top 1,000 for first time since May

Peter Wells in New York

The US reported more than 1,000 new coronavirus deaths for the first time since May, while the number of new cases ticked back above 60,000.

A further 1,029 people died from the disease over the past 24 hours, according to data from Covid Tracking Project, up from 362 on Monday.

That is the biggest increase in deaths since May 29 when excluding a one-time revision of almost 1,900 to New Jersey’s death toll on June 25, according to Financial Times analysis of Covid Tracking Project data. Florida (136), Arizona (134) and Texas (131) reported the biggest single-day jumps in fatalities.

Florida reported its second-biggest one-day increase in coronavirus deaths on Tuesday, but the number of new cases eased below 10,000 for the first time in a week.

Florida teachers are resisting returning to school, fearing a spread of the virus, and some held protests on Tuesday, pictured.

Meanwhile California has become the second US state — after New York — to have confirmed 400,000 coronavirus cases since the pandemic began after passing the milestone for the first time.

Nevada (28) and Arkansas (17) had record increases. A further 62,749 people in the US tested positive for coronavirus over the past day, according to Covid Tracking Project, up from almost 57,000 yesterday. Florida (9,440), Texas (9,305) and California (9,231) had the biggest increases. California’s increase was enough to push to state’s total above 400,000.

The state is set to surpass New York as the US state with the most confirmed coronavirus cases as soon as Wednesday. Wisconsin (1,161) and Missouri (1,138) were the only states to have reported record increases in cases, according to Financial Times analysis of Covid Tracking Project data.

In case you missed it …

Donald Trump has said the Covid-19 pandemic will “probably unfortunately get worse before it gets better”, in his first White House coronavirus task force press briefing in almost three months.

United Airlines reported a loss of $1.6bn in the second quarter as the airline industry struggled with the fallout from the coronavirus pandemic. The Chicago company reported an 87 per cent year-on-year drop in operating revenue to $1.48bn from a year earlier.

Vaccine makers tried to reassure Congress that the US would not be forced to rely on foreign manufacturing for any potential Covid-19 vaccine, while staying committed to aiming to deliver a safe and effective inoculation by next year.

This year’s edition of the Indian Premier League, the world’s top cricket tournament, is on track to take place in the United Arab Emirates as coronavirus rages in its home country. The two-month tournament, due to start in March, was postponed indefinitely due to coronavirus and India’s nationwide lockdown.

Snap said that its revenues this month were running close to one third higher than in July last year, signalling a rebound in spending by pandemic-hit advertisers even as it warned of headwinds in the rest of the quarter.

Most of the US is still not reporting essential coronavirus data, making it harder for officials to fight the pandemic, a former director of the country’s top disease fighting agency has warned.