Coronavirus latest: Texas lays out plans to gradually reopen state economy

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Vale production and sales tumble in the first quarter due to coronavirus

Andres Schipani in São Paulo

Production and sales at Vale, the world’s biggest iron ore producer, tumbled in the first quarter because of “limited” coronavirus-related disruptions.

In a trading update, the Brazilian company said it mined 59.6m tonnes of the steelmaking ingredient in the three months ended March 30, down 23.9 per cent on the previous quarter and below their output guidance for the quarter of 63m-68m tonnes. Vale’s sales of iron ore plummeted to 51.6m tonnes, down 33.7 per cent from the last quarter of 2019.

“In the future, the impact of COVID-19 on Vale’s operations may be more significant,” the company warned because of fewer personnel on sites, delays in maintenance, and potentially further restrictions imposed to fight the virus.

The Rio de Janeiro-based miner slashed its full year production guidance to 310m-330m tonnes, down from 340m-355m tonnes partly because of delays in the restarting of operations in its Timbopeba and Fábrica mines because of Covid-19 limitations. There were also delays in the upgrading of its mining waste systems at Brucutu, its largest operation in Minas Gerais, as the company has been under pressure to lessen the risk of another accident following the deadly collapse of a tailings dam at Brumadinho in January last year.

The pandemic also forced Vale to temporary 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.

Shares in Vale were up 2.8 per cent on Friday.

Amazon converts some of its Whole Foods stores to serve online orders only

Dave Lee in San Francisco

Whole Foods has converted three locations into so-called “dark stores” that cater to online orders only, as the Amazon-owned chain continues to struggle to meet demand.

Social distancing measures at the chain have led to long wait times and lines outside stores. The company now believes focusing on delivery will allow it to serve a greater number of total customers per day.

Whole Foods closed its Bryant Park, New York, location earlier this week. A new store in Baltimore, yet to actually open to the public, is now up and running as a dark store instead. A store in San Francisco’s Soma district will now close daily at 1pm to deal with online demand.

Whole Foods spokeswoman Stephanie Ferragut told the FT the company was exploring other locations that could be converted soon. A separate Amazon-owned store in Woodlands Hills, Los Angeles, is being used as a dark store too, the company confirmed last weekend.

“With stay-at-home orders in place, customers have generated unprecedented demand for grocery delivery,” Ms Ferragut said. “As we navigate the challenges associated with Covid-19, we continue to find ways to increase delivery availability while navigating safety measures and social distancing.”

The coronavirus crisis has exposed weaknesses in Amazon’s grocery supply chain and logistics operation, forcing at first the suspension of its Prime Pantry service. Last week the company implemented a waiting list for new customers wishing to use grocery delivery.

Other major brick-and-mortar retailers have sought to adapt to social distancing guidelines. Consumer electronics retailer Best Buy has switched to a curbside pick-up only model to handle some online orders. However, the firm said decreased footfall meant it had to furlough more than 50,000 employees.

US death toll tops 32,000 as daily rate remains above 2,000

The US suffered a fourth consecutive day of coronavirus deaths exceeding 2,000, taking the total number of lives lost in the country during the outbreak to more than 32,000.

A further 2,060 people died from Covid-19 over the past 24 hours, according to data from the Covid Tracking Project released on Friday afternoon, with 630 of those in New York and 322 in New Jersey, the worst and second worst hit states.

The US has now recorded 32,356 deaths and nearly 687,000 reported cases since the outbreak began.

President Donald Trump and some governors, such as New York’s Andrew Cuomo, have said there are signs the virus is peaking nationally and in some states. Texas on Friday became one of the first states to lay out plans for the gradual reopening of its economy.

Pemex’s credit rating cut to junk by Moody’s

Jude Webber in Mexico City

Moody’s Investors Service has chopped Mexican state oil company Pemex to junk, becoming the second ratings agency to do so, in what will trigger forced sales by institutional investors required to hold investment grade paper.

The downgrade – to Ba2 with a negative outlook – was triggered by the company’s higher liquidity and business risk the agency said, as well as by a downgrade of Mexico’s long-term foreign sovereign debt to Baa1 from A3, keeping the sovereign rating investment grade.

“We downgraded Pemex’s ratings and maintained the negative outlook on its ratings following the downgrade of Mexico’s rating and its negative outlook given the critical importance of the government’s financial strength and support in the assessment of Pemex’s credit risk,” said Nymia Almeida, Moody’s senior vice president in a statement.

“The actions took in to consideration our expectations for an extended period of negative free cash flow and the need for external funding, despite the company’s efforts to adjust costs and investments to low oil prices.”

Moody’s said in a separate statement the sovereign downgrade came because “Mexico’s medium term economic growth prospects have materially weakened and Pemex’s financial [and] operational standing is eroding the sovereign’s fiscal strength, which is already pressured by slower revenue growth due to a weaker economy”.

The finance ministry said in a statement there had been downgrades worldwide because of the coronavirus crisis. “In this context, in the last three weeks, the three main ratings agencies have revised down Mexico’s sovereign ratings a notch … all of them remaining investment grade. This ensures the Mexican government continues to have ample access to financing in the markets.”

FTC sues alleged fake PPP loan provider

Kadhim Shubber in Washington

The Federal Trade Commission has sued a Rhode Island man for allegedly offering coronavirus stimulus loans to small businesses despite not being an approved lender.

The lawsuit, the US consumer agency’s first stemming from the coronavirus, alleged John Ponte and his firm, Ponte Investments, tricked small businesses into submitting applications for Paycheck Protection Program loans.

Only lenders authorised by the Small Business Administration are able to offer the loans, which were created as part of the CARES Act coronavirus stimulus package.

“In this time of incredible challenge for all Americans, it is disturbing to see these defendants preying on desperate businesses looking for ways to keep their employees financially secure,” said Joseph Simons, the FTC chairman, in a statement.

Mr Ponte was “luring consumers in” through a website called, the FTC alleged. A recent blogpost on the website warns that “one way scammers may try to get small business owners personal information is through fake Small Business Administration (SBA) grants”.

Christopher Mulhearn, an attorney for Mr Ponte and Ponte Investments, said the company had “inadvertently” posted on its website that it had approval from the SBA after making an application to be a direct lender under the PPP programme.

He said the statement had been removed soon after it was posted. Mr Mulhearn added he hoped there could be “an immediate resolution” of the FTC’s lawsuit.

Mexico’s López Obrador suggests meeting with Trump in the summer

Jude Webber in Mexico City

Mexico’s Andrés Manuel López Obrador has suggested on a call with Donald Trump that the two leaders meet in June or July so that Mexico can thank the US president for his support.

In the midst of tense negotiations over Easter to try to reach a deal on cutting global oil production, Mr López Obrador had asked the US president to supply Mexico with 10,000 ventilators as the critical phase of the pandemic approaches in Mexico. Most of the country is set to remain on lockdown until June.

“President Trump called me to reply to our request to buy ventilators and intensive care equipment,” Mr López Obrador tweeted. Mr Trump guaranteed 1,000 by the end of April and “we can buy more,” he added.

“This is a new gesture of solidarity with Mexico. I suggested the possibility of meeting in June or July to express in person our thanks and to witness the entry into force of USMCA,” he added, referring to the new free-trade pact between the US, Mexico and Canada.

Mr Trump bailed out Mexico in the oil deal – picking up a production cut that Mexico refused to make – but said Mexico would pay for it later. Last year, he threatened tariffs on Mexican exports unless it cracked down on migrant flows headed for the US, which Mexico duly did.

The two leaders now say they are friends and Mr López Obrador – who has never travelled abroad since taking office in December 2018 – has made clear that keeping US relations sweet is a top policy priority.

US stocks make consecutive weekly gains for first time since February

Wall Street advanced on Friday, notching its first back-to-back weekly gains since February, on hopes of a potential drug to treat Covid-19.

The S&P 500 ended the day 2.7 per cent higher taking its weekly gain to 3 per cent. Meanwhile, the Nasdaq Composite rose 1.4 per cent on the day and 6.1 per cent for the week. That marked the first consecutive weekly gains for both indices since mid-February.

Stocks were given a boost by reports that remdesivir, a drug produced by Gilead Sciences, has produced promising signs as a treatment against coronavirus. “The latest surge for stocks shows just how keen the market is to react to any piece of good news amid the current crisis,” Russ Mould, investment director at AJ Bell, said.

Investors largely overlooked a historic contraction in China’s economy and bet that aggressive efforts by policymakers may be effective in ending weeks of chaos in markets.

Moreover, while US President Donald Trump backed away from threats to force a quick reopening of the US economy, investors cheered prospects that parts of the country could soon reopen, with Texas on Friday announcing an initial round of loosening restrictions would get underway next week..

Elsewhere in markets, the yield on the US 10-year Treasury rose to 0.651 per cent. The dollar index, a gauge of the buck against a weighted basket of peers slid 0.3 per cent.

Texas lays out plans to gradually reopen state economy from next week

Texas laid out plans to begin gradually reopening parts of its economy that will see restrictions on retailers, surgeries and state parks loosened from next week.

Governor Greg Abbott announced that a new “strike force” comprising state leaders, health officials, as well as figures from the business and non-profit sectors had been formed to oversee the phased reopening of the state economy while also continuing to limit the spread of coronavirus.

An initial round of loosening restrictions will commence next week, with additional measures possibly announced the week of April 27 and in May if it remains safe and practical to take further steps.

As part of an executive order issued by Mr Abbott at his press conference on Friday, businesses not previously considered essential can offer “retail to go” services from April 24, but customers will still not be allowed in stores.

From April 20, restrictions on doctors and nurses would be loosened as long as their surgeries had enough personal protective equipment, and state parks would be reopened, with visitors still expected to practice physical distancing measures.

Schools will remain closed through the end of the academic year, Mr Abbott said, because health officials ruled that for the “forseeable future” it was unsafe to have students gathering in large numbers.

Walmart to hire 50,000 additional workers

Walmart said it will hire 50,000 more workers, on top of the 150,000 temporary staffers it has already taken on, as the retailer continues to see strong demand as consumers stock up during the coronavirus pandemic.

The Arkansas-based retailer said the new workers will be hired on a temporary basis and provide existing associates flexibility to take time off and stay at home. The new workers will be hired as cashiers, stockers and personal shoppers as well as in the company’s distribution centres.

Walmart said it had reached its previously announced goal of hiring 150,000 as it took on about 5,000 people a day on average. Walmart worked with more than 70 companies that have furloughed employees to hire the 150,000 associates and said they had come from the restaurant and hospitality industries as well as other retailers. The retailer added that about 85 per cent of these were hired into temporary or part-time roles.

Walmart, alongside retailers like Amazon and Kroger’s, have bucked the trend of mass job cuts in the US economy with more than 22m Americans filing for first time unemployment benefits since March.

Ireland death toll climbs to 530

Arthur Beesley in Dublin

Ireland reported 44 further coronavirus deaths as health officials set out plans to test some 58,000 residents and staff in nursing and long-term care homes over ten days because of increased disease clusters in such homes.

With the number of Covid-19 infections now at 13,980, the latest deaths bring to 530 the number of fatalities in the country.

Officials reported 166 clusters in nursing homes and 95 in care homes, now the central focus of the battle against the pandemic after severe restrictions on public movements suppressed its growth in the general population.

“This is the biggest at-risk setting for us at the moment,” Colm Henry, chief clinical officer in the health service executive, told a press conference on Friday.

“Clearly our priority now is to tackle these outbreaks in nursing homes, a particularly hazardous environment, and the danger that presents to residents and to staff.”

French hospitalisations, intensive care patients fall further

Victor Mallet in Paris

The number of severely ill coronavirus patients in intensive care in French hospitals fell on Friday for the ninth consecutive day to 6,027 as the epidemic continued to ease from its peak after more than a month of lockdown for the population.

“It’s a slow but steady decline,” said Jérôme Salomon, director-general of health. He said an additional 761 people had died from Covid-19 infections in the past 24 hours, with the total death toll in France reaching 18,681.

The number of additional deaths in hospitals was 418, with the rest recorded in old people’s homes and other care homes. France now includes the deaths in old people’s homes in its daily bulletins.

French mortality as a whole has risen sharply since mid-March, especially in the Paris and eastern France regions worst hit by the pandemic, according to Insee, the national statistics institute.

Poland unable to hold traditional presidential poll for 2 years, health minister says

James Shotter in Warsaw

Poland will not be able to hold presidential elections in their traditional form for at least two years because of the risks posed by the coronavirus pandemic, the country’s health minister said on Friday.

Poland is due to hold a presidential vote on May 10, but with the country in lockdown to slow the spread of the virus, opposition politicians have called for the vote to be postponed, arguing that it would be both dangerous and unfair to go ahead now.

However, the ruling Law and Justice party is desperate to avoid postponing the poll — which its candidate, incumbent Andrzej Duda, is favoured to win — and is instead trying to push through legislation for the vote to be held by postal ballot.

Lukasz Szumowski said on Friday that his recommendation was to hold the election in two years’ time. However, he added that if this was not possible then a postal vote was the “only safe” alternative, although he did not specify when it should be held.

Malgorzata Kidawa-Blonska, the main opposition candidate — who has suspended her campaign and called on voters to boycott the poll because of the risks attached and the fact that opposition candidates are unable to campaign properly — said it would be wrong to hold the vote next month. “A postal ballot in May will not be safe, or honest, or secret,” she wrote on Twitter.

Fitch sends Pemex deeper into junk territory

Jude Webber in Mexico City

Fitch pushed its rating for Mexican oil company Pemex deeper into junk territory with a second downgrade in a fortnight.

The rating agency cut Pemex to BB- after lowering them to BB only on April 3. The move followed a cut to Mexico’s sovereign rating to one notch above junk this week as the coronavirus crisis deepens.

The agency also downgraded electricity utility CFE to BBB- from BBB as a result of “these companies’ direct linkage to Mexico’s sovereign ratings”. It rated Pemex’s stand-alone credit profile (SCP) at CCC.

It said in a statement:

PEMEX’s SCP deterioration reflects the company’s limited flexibility to navigate the downturn in the oil and gas industry given its elevated tax burden, high leverage, rising per-barrel lifting costs and high investment needs to maintain production and replenish reserves. CFE’s ratings are equalised to those of Mexico given its strong linkage to the government.

It added that Pemex had weak corporate governance and a continued high level of government interference in the company’s strategy, financing and management changes.

All eyes are now on Moody’s. If, as is widely expected, it cuts Pemex to junk within weeks, investors could be forced to sell billions of Pemex debt because some institutions are required to hold investment grade paper and to sell if two agencies push the rating into speculative terrain.

New York’s Cuomo urges federal government to help fund state testing

New York Governor Andrew Cuomo called for the federal government to allocate $500bn to his home state and others that are bleeding money as they fight the coronavirus epidemic.

The state, which has the highest number of deaths and infections in the US, is already in “terrible deficit”, “spending money every day” and would have to spend more to support the scale of Covid-19 testing facilities to enable it to safely move forward with a plan to reopen its economy, Mr Cuomo said.

Donald Trump claimed earlier this week that the president and the federal government had “total authority” over reopening the US economy. He backed away from that on Wednesday and said he would authorise the states to arrange their own reopenings, but not before many state governors said the responsibility lay with them, given they made individual decisions to lock down their economies and may need to coordinate a reopening strategy with neighbouring states.

“State governments have got precisely zero, zilch, nada in unrestricted funding” from the three bills the federal government has passed to address this crisis, Mr Cuomo said on Friday at his daily news briefing.

“Don’t give [the states] this massive undertaking that has never been done before and then don’t give them any resources to do it,” he said. “That is passing the buck without passing the bucks.”

Over the past 24 hours, a further 630 people in New York state died from coronavirus, from 606 a day earlier, but Mr Cuomo said trends in hospitalisations and intubations remained encouraging.

UK sets up Covid-19 vaccine development task force

Charlotte Middlehurst in London

The UK has launched a special task force to develop a vaccine for the coronavirus at mass scale, said the government at its daily Downing Street briefing.

Alok Sharma, secretary of state for business, energy and industrial strategy, announced 21 research projects along with £14m of funding, as well as a hub in Harwell near Oxford.

“The government has set up a vaccines task force to coordinate the efforts of government, academia and industry towards a single goal,” he said.

This task force is up and running and aims to ensure a vaccine is available to the public as quickly as possible.

The group’s members include Sir John Bell, Astrazeneca and the Wellcome Trust.

“Producing a vaccine is a colossal undertaking… There are no guarantees but the government is backing our scientists betting big to maximise our chances of success,” Mr Sharma said on Friday. “When we do make a breakthrough we will be ready to manufacture by the millions.”

Apple iPhone demand could fall 36% in Q2, Goldman says

Apple iPhone demand could fall by more than a third in the current quarter, analysts at Goldman Sachs predicted, citing the sharp economic contraction as a result of the coronavirus pandemic.

The bank now expects iPhone demand to fall 36 per cent year-on-year in the second quarter and only just recover to about a 2 per cent drop in the final three months of the year. “We are modeling a similar trajectory for Apple’s other products as well,” Rod Hall analyst at Goldman Sachs said.

Mr Hall downgraded the stock to “sell” from “neutral” and cut the price target to $233 — down from $250 previously — about 19 per cent lower than Thursday’s closing price. He attributed the reduced forecasts and downgrade to “two further GDP growth cuts from the GS Economics team” and the lockdown in “much of the world”.

Apple released a revenue warning in mid-February as a result of the spread of coronavirus and closed all of its stores outside China in mid-March.

The dour note from Goldman pushed Apple shares down 2 per cent to $280.85.

Canada commits almost $2bn for clean energy jobs

Joshua Oliver in London

Canada will spend C$1.7bn ($1.2bn) cleaning up disused oil wells in an attempt to create jobs in the energy sector, which has been hit hard by Covid-19 and low oil prices.

The government also plans to launch a C$750m emission reduction fund, operating primarily through repayable contributions to companies to cut methane output.

The two programmes are expected to support 10,000 jobs, the government said.

“Our goal is to create immediate jobs,” said prime minister Justin Trudeau. “Just because we’re in a health crisis doesn’t mean we can neglect the environmental crisis.”

Mr Trudeau said that the programme will focus on “orphan and inactive” oil wells in western Canada that “are no longer in use, [and] can be detrimental not only to our environment but to people’s health”.

“Cleaning them up will bring people back to work and help many landowners,” he said.

Speaking at his daily briefing in Ottawa, Mr Trudeau added details to previously announced military aid to care homes in the province of Quebec, saying 125 military personnel with medical training would be deployed.

The government is working to send further help, including from the Red Cross, he said.

Canada’s confirmed Covid-19 cases have passed 30,000, with 1,775 new cases in the past day. Health Canada reported 202 new deaths, taking the total to 1,250.

New York Fed outlines plans to ensure bid ‘transparency’ with banks

Colby Smith in New York

Daleep Singh, head of the markets groups at the Federal Reserve Bank of New York, outlined on Friday the central bank’s plans to ensure “transparency” in its relationships with investment banks such as Pimco and BlackRock.

The groups have been tapped to manage some of the Fed’s emergency facilities that have been launched in recent weeks to limit the economic and financial damage created by the coronavirus outbreak.

Mr Singh, in remarks delivered at an event organised by New York University, laid out how the central bank is going about its bidding process to select which businesses will be responsible for administering its programmes and what information it is making publicly available.

He said if the Fed has to accelerate the selection process initially to ensure the facility can come online quickly, it would establish a short-term contract before opening up the process to “a competitive range of bidders, looking beyond the largest and most established players and providing broad access to a diverse range of smaller players”.

Mr Singh made assurances that the terms and conditions of the facilities will be published online, alongside a set of guides to understand what the
Fed seeks to accomplish.

“We will proactively identify and address conflicts of interest – real or perceived – for anyone working on the facilities,” Mr Singh said. “Personal investment guidelines will be refined as needed, and rules will be clear on the gathering of market intelligence and handling sensitive information related to the facilities.”

The Fed has faced some criticism for tapping BlackRock, the world’s largest asset manager, to manage its corporate bond-buying programme, as well as its purchases of agency mortgage-backed securities. The central bank has also hired Pimco and State Street to help facilitate its commercial paper facility.

Majority in UK support using phones for Covid-19 contact tracing

Helen Warrell in London

Nearly two-thirds of Britons are in favour of letting the government use mobile phones to track coronavirus sufferers and inform others that they may be at risk, according to new polling by Ipsos Mori.

The survey, commissioned by the Financial Times, suggests that concern over public health is trumping privacy worries as ministers look to technology as a way of managing the outbreak and easing lockdown restrictions.

When asked, 65 per cent of people said they agreed with using smartphones to identify people who had been diagnosed with the virus and establish who they had come into close contact with. Support for the idea rose to 73 per cent among 55 to 75-year-olds and fell to 59 per cent in those aged 18 to 34.

Read the full story here.

World Bank warns countries not to use Covid-19 as excuse to close markets

Jonathan Wheatley in London

David Malpass, president of the World Bank, has called on countries not to use the coronavirus crisis as a reason to close their markets, but to ensure that trade in food, medical supplies and other goods continues as a cushion against the downturn.

“We have tried to discourage countries from hoarding,” he said during a press conference on Friday. “There is a tendency to hunker down in a crisis but it is a critical part of global cooperation not to do that.”

He said it was important for all countries involved in supply chains of food and medical equipment to maintain open markets, and to allow trade more broadly “in order to maintain prosperity and cushion the blow”.

He added: “The world needs to work together to share goods from countries will plentiful supplies of certain things, and not get into a barter system. Supplies must get to those most in need.”

UK extends job support scheme by a month

Valentina Romei in London

The UK is to extend its financial support for furloughed workers by one month following the government’s decision to keep social distancing measures in place for at least another three weeks.

The chancellor, Rishi Sunak, said on Friday the coronavirus job retention scheme would be open until the end of June. It was originally open for three months and backdated from March 1 to the end of May.

“It is the right decision to extend the furlough scheme for a month to the end of June to provide clarity,” said Mr Sunak.

The scheme allows businesses to furlough employees with the government paying cash grants of 80 per cent of their wages up to a maximum of £2,500. This week, the Office for National Statistics showed that among businesses that had continued operating since the outbreak, 21 per cent of the workforce had been furloughed.

“With applications for the scheme opening on Monday, and April’s payday fast approaching, it is essential that payments are made as soon as possible,” said the British Chambers of Commerce.

“Any delay would exacerbate the cash crisis many firms are facing and could threaten jobs and businesses,” its director-general Adam Marshall said.


Andrew Bailey backs OBR estimate of 35% tumble in UK output

Chris Giles in London

Andrew Bailey gave the Bank of England’s backing on Friday to the British fiscal watchdog’s assessment that output in the UK economy had plunged 35 per cent since the coronavirus lockdown.

Speaking on a conference call to journalists, the BoE governor suggested Britain’s economic plight might even be worse than the picture painted by the Office for Budget Responsibilty, indicating that there could be some persistent “scarring” creating a lasting hangover.

With Britain potentially facing a long period of pain, he said banks in the short term had to “sort out” the operational delays to getting loans to small companies.

But he added there needed to be more thinking about what would happen if companies could not take on any more debt and there were still concerns over their ability to continue when the lockdown ends. He suggested that small companies might need grants from the government to keep them viable, although stressed this was a decision for the chancellor rather than the central bank.

Mr Bailey said the BoE was in the process of putting together its own forecasts for the UK economy which will be published in early May and was currently looking at a suite of real-time indicators showing big drops in output of many sectors, large rises in claims for universal credit and business surveys suggesting high usage of the government’s furlough scheme for employees. 

Asked about the OBR’s assessment that gross domestic product had fallen off a cliff since the lockdown and was now down 35 per cent compared with the start of the year, Mr Bailey said, “I don’t think there is anything implausible about a second quarter number of that nature”.

Number of recent deaths in France higher compared with previous years

Valentina Romei in London and Victor Mallet in Paris

The number of deaths in France has risen sharply in recent weeks during the worst phase of the country’s coronavirus epidemic, with three departments in the Paris region and eastern France in particular seeing a surge.

Between March 1 and April 10, the cumulative number of French deaths rose to nearly 80,000, according to the national statistics office. The figure is about 24 per cent higher than in 2019 and 12 per cent above the same period in 2018, when there was an influenza epidemic, which killed many older people.

The Insee figure includes all municipalities that transmit data automatically, which is about 94 per cent of the total.

The increase reflects a spike near the end of March and it reverses a lower mortality rate in the first part of this year. In the first two weeks of March, France counted nearly 2,000 fewer deaths than the average of the previous two years but, by April 10, there were 12,000 more cumulative deaths.

Mortality began increasing sharply in mid-March this year, just as the government imposed a lockdown on people’s movements, which is designed to stop the spread of the Covid-19 virus and which has been extended to May 11.

Insee said the apparent improvement from the start of April should be treated with caution, because it was possible some deaths had yet to be reported for the most recent week in the data.

Paolo Surico and Andrea Galeotti, London Business School academics, calculated that 40 per cent of the deaths this year are related to Covid-19 based on official statistics.

Insee data show that France’s north-eastern regions experienced the fastest increase, with the number of deaths rising by more than 40 per cent in the departments of Moselle and Haut-Rhin, at the German border.

Older men are the most affected with cumulative deaths up to April 6 rising 28 per cent among men aged 75 and above.

Amazon workers in northern Italy strike over Covid-19 measures

Patricia Nilsson in London

Workers at an Amazon distribution centre in northern Italy went on strike today, demanding that operations be slowed down after a fourth person at the warehouse tested positive for coronavirus.

The labour union Filt CGIL on Friday accused Amazon of not responding to concerns raised by workers at the warehouse in Torrazza Piemonte, where roughly 1,200 people are employed.

It said staff had no way of knowing whether they had been exposed to the disease, as Amazon would not disclose what shifts infected employees had been on, citing privacy rights. The union also reiterated concerns about workers being unable to practise adequate social distancing.

“Everything is still sold and the pace inside the warehouses and among couriers is crazy,” said local union representative Teresa Bovino.

The strike comes one day after Amazon was forced to close one of its warehouses in France to comply with a court order to implement a limit on sales of essential products, following a high-profile battle with a French union over Covid-19 worker protections.

Tension between Amazon and its workers has intensified, while the ecommerce group has become important to many shut in their homes, sending its stock price to all-time highs. Amazon has since the outbreak of the pandemic said it will hire another 175,000 people to cope with demand, bringing its workforce to just under 1m worldwide.

Amazon said it was following guidance from health officials and taking “extreme measures” to ensure the safety of employees.

Ford warns of $2bn loss for the first quarter

Claire Bushey in Chicago

Ford warned it will slump to a $2bn loss in the first quarter as most of the company’s global plants remain shuttered due to the coronavirus pandemic.

In the first quarter of 2019, the company reported net income of $1.1bn. Ford said on Monday that it would report a $600m loss before taxes on $34bn in revenue.

The only Ford factories that are producing and selling cars to dealers are at its joint ventures in China, where the virus first took hold and where the economy is now reopening. Sales to dealerships are down 21 per cent compared with a year earlier as consumers stay away from showrooms.

The company plans to restart its manufacturing plants and supply network sometime in the second quarter. The company has $30bn in cash on its balance sheet, which chief financial officer Tim Stone said is “sufficient … to get us through at least the end of the third quarter with no incremental vehicle production and wholesales or financing actions”.


UK’s death toll passes 14,000

A further 847 patients have died in hospital in the UK from Covid-19, the Department of Health said.

The country’s overall death toll as of 5pm on Thursday stood at 14,576, while 108,692 people had tested positive as of 9am on Friday morning. The data are recorded separately, leading to different cut-off points for when they are collated.

It is worth taking the number of cases with a pinch of salt, given the UK’s relatively under-developed testing regime. The country aims to test 100,000 people a day by the end of April, but only carried out 21,328 tests on Thursday.

Scotland expands support for fishing industry to £23m

Mure Dickie in Edinburgh

The Scottish government on Friday expanded support for the coronavirus-hit fishing sector, offering grants of up to £21,370 for vessels of over 12 metres that land shellfish such as crab, lobster and langoustine.

Scotland has already been offering grants for smaller fishing boats as well as hardship payments for shellfish growers and trout farms, with government support for seafood fishing and aquaculture now worth a total of £22.5m.

“It’s clear that the market for fish and shellfish has effectively collapsed and that is having a very serious and immediate impact on many of our coastal and island communities,” Nicola Sturgeon, first minister, told a news briefing.

The UK government, which was criticised for not including English fishermen in its coronavirus emergency funding, announced earlier on Friday that it would now offer up to £9m in cash grants for more than 1,000 fishing and aquaculture businesses and a further £1m to help fishing operators sell their catch locally.

Spain’s daily death toll remains above 500

Daniel Dombey in Madrid

Spain says its most recent daily coronavirus death toll has risen to 585 after a week in which the fatality rate remained stubbornly above 500 a day.

The figures highlight the difficulty, almost five weeks into the country’s nationwide lockdown, of further reducing the death count, which has fallen from a peak of 950 on April 2 but has oscillated for over a week between 510 and 619 a day.

Analysis of the latest data, as of 9pm on Thursday, is complicated by methodological changes that have reduced Spain’s previous tallies of deaths, and of people who have recovered.

The government says it will soon issue an adjusted set of previous days’ figures to take account for disparities in information provided by regional authorities. It adds that recent increases in the number of confirmed cases — which have risen 2.9 per cent in 24 hours to 188,068 — partially reflect more testing.

The central government is also at odds with regions, such as Catalonia, that have begun to provide data on people who were not tested for coronavirus but who died after displaying symptoms of Covid-19. Including such fatalities could increase the overall death toll by at least 40 per cent but the government says it is following World Health Organization guidelines by including only proven coronavirus cases

“Basing official figures on Covid symptoms, knowing how much they can vary… would give a very distorted image of reality,” Fernando Simón, the doctor helping lead the country’s effort against coronavirus, said on Friday.


UK regulator approves Deliveroo-Amazon deal

Tim Bradshaw and Kate Beioley in London and Javier Espinoza in Brussels

The UK’s competition regulator has granted provisional approval to Amazon’s investment in Deliveroo, after concluding that the London-based company was at risk of going under without receiving new funds.

“In recent weeks, it has become clear that the coronavirus pandemic is having a significant negative impact on Deliveroo’s business,” the Competition and Markets Authority said in a statement on Friday.

Deliveroo recently informed the CMA that the impact of the coronavirus pandemic on its business meant that it would fail financially and exit the market without the Amazon investment.

Approval by the Competition and Markets Authority will come as a relief to Deliveroo’s investors, some of whom had become concerned about a cash crunch even before the Covid-19 outbreak, after hundreds of millions of dollars of investment was put on hold during the investigation.

UK set designer of Frozen secures support for its prop production

A Cardiff-based set designer has secured a six-figure funding package, under the government’s coronavirus loan scheme, that will help support its production of West End props once the UK lockdown has been eased.

Bay Productions, which works with opera and theatre producers, such as Cameron Mackintosh and the English National Opera, has secured the funding from Lloyds Bank to help support its “cashflow while it is unable to operate as normal during the Covid-19 outbreak”, Friday’s statement from the bank said.

No specific amount was given.

“The bank has put us in a position where we can bridge any gaps that appear in our cashflow while projects await completion,” said Peter Jones, director of Bay Productions. “The funding will also enable us to spring back into action when the time comes.”

The pandemic outbreak and subsequent lockdown have prompted the group’s team of 50 to pause a number of its projects, including the set for the Disney musical Frozen, which was scheduled to open in London this year. Set production for Matthew Bourne’s ballet The Red Shoes and Derren Brown’s live tour Showman has also been paused.

The group’s portfolio includes working on the London summer Olympic Games of 2012, Les Miserables and Oliver! as well as La Bohème at Washington National Opera and Don Giovanni at the Lyric Opera of Chicago.

The government’s coronavirus business interruption loan scheme is limited to companies with turnover of less than £45m and allows them to access government-backed loans of up to £5m.

Altria chief Howard Willard steps down as he recovers from virus

US tobacco group Altria said it chairman and chief executive Howard Willard who was recovering from Covid-19 “decided to step down” earlier this week.

Mr Willard stepped down on April 14 after a 28-year tenure at the Virginia-based company behind Marlboro cigarettes, Altria said on Friday. The company tapped Billy Gifford, who most recently served as chief financial officer and vice-chairman, to succeed him.

Altria said the board also separated the role of chairman and chief executive and has named board member Thomas Farrell, as chairman with effect from Thursday.

“The board thanks Howard for his nearly 30 years of distinguished service to Altria,” said Mr. Farrell.

The leadership and governance changes come after Altria in January took a $4.1bn writedown on its investment in Juul, that slashed the value of the e-cigarette company to a fraction of the price at which Altria bought in at the end of 2018.

Altria shares, which are down 19 per cent year-to-date, rose 2 per cent in pre-market trade alongside a broader rise in US stock futures.

Gilead’s coronavirus drug: Does it work?

Of the more than 100 drugs being tested to fight the new coronavirus Covid-19, people have invested most hope in remdesivir.

A leaked report on Thursday night of positive results from a clinical trial of remdesivir in Chicago caused shares in its manufacturer, Gilead Sciences, to rise 14 per cent in after-hours trading and sparked an overall market rally in Asia and Europe.

The FT’s science editor Clive Cookson explains what remdesivir is, what results came out of the Chicago trial, what remains uncertain and how the drug compares to other potential treatments undergoing testing.

Read the full story here.

Consumer stockpiling boosts P&G sales

Alistair Gray

Stockpiling of consumer goods in the coronavirus pandemic has boosted sales at Procter & Gamble.

The household products stalwart said it produced $17.2bn worth of net sales in the three months to the end of March, up 6 per cent from the same period a year ago on an organic basis.

Strong demand ahead of the worst of the outbreak in North America and Europe offset disruption declines in China, where the coronavirus shutdown hit sales. Net earnings came in at $2.96bn, a rise of 7 per cent.

Schlumberger revenue slides as ‘black swan event’ hits oil industry

Derek Brower, US energy editor

Schlumberger, the world’s biggest oilfield service company, said on Friday its first-quarter revenue fell by 9 per cent compared with the previous quarter and by 5 per cent compared with the same period last year, as the collapse in oil prices due to the coronavirus hit to global demand took its toll. It slashed its dividend by 75 per cent.

The company announced a net loss for the quarter of $7.4bn, including an $8.5bn pre-tax charge as it wrote down the value of some its businesses. Net income for the same quarter last year was $421m.

Schlumberger reiterated plans to reduce its capex this year by 30 per cent and said cuts would include job losses, furloughing of personnel, closure of facilities and lower salaries, including reductions to executives’ cash compensation.

Olivier Le Peuch, Schlumberger’s chief executive, said the “black swan event” of the Saudi-Russia oil price war and the virus pandemic “created simultaneous shocks in oil supply and demand resulting in the most challenging environment for the industry in many decades”. Global oil consumption was down by 20m-30m barrels a day, or up to 30 per cent of the pre-crisis total, he said.

First-quarter revenue from Schlumberger’s business in North America, where shale producers have slashed spending and begun idling rigs, was down 17 per cent compared with the same quarter in 2019. Capex across the continent’s oil and gas sector would fall by 40 per cent this year, twice the global average, Mr Le Peuch said. Globally, companies would approve fewer projects than at any time since 2015, he added.

Cash flow from operations for the quarter came in at $784m while free cash flow was $179m, beating analysts expectations in both categories. Schlumberger’s international business in the first quarter held up, with revenue growing by 2 per cent year-on-year. The new dividend per share of $0.125 was well beneath analysts’ consensus for $0.48.

Swiss banks lend small businesses more than $16bn

Sam Jones in Zurich

Swiss banks have lent more than $16bn interest free to small businesses over the past three weeks to help support them during the pandemic.

The 103,389 loans, guaranteed by the government, total more than SFr16.1bn ($16.6bn), according to the latest figures on the scheme provided to the Financial Times by the Swiss Banking Association.

Switzerland’s success in providing rapid credit support to small businesses to help them survive the coronavirus lockdown has attracted global attention.

The scheme’s uptake stands in stark contrast to other European countries. The UK’s Coronavirus Business Interruption Loan Scheme, for example, has made 6,020 loans, worth £1.1bn, in roughly the same period as Switzerland.

The Swiss programme, the brainchild of Credit Suisse chief executive Thomas Gottstein, is approving about 2,000 loans each day. The rate has slowed significantly since an early surge in applications. Under the first facility of the scheme, businesses can apply through their existing banks in as little as 30 minutes for up to SFr500,000 in credit, guaranteed in full by the government.

A second facility of the loan scheme, under which businesses can apply for as much as SFr20m in credit — 85 per cent backed by Bern and with a low interest rate on the remaining portion — has begun to have some uptake, said the SBA.

Switzerland announced a cautious, phased approach to restarting its economy on Thursday. Under Bern’s plan, most shops will re-open in mid-May. Restaurants, cafes and bars are unlikely to welcome customers back until at least June, however.

Public Health England under pressure to reveal costs of tests

Camilla Hodgson in London

Public Health England has been given one week to disclose the details of how much the government paid for Covid-19 antibody tests, who they were bought from and how much money has been recovered after the devices were deemed not fit for purpose.

Greg Clark, chair of the science and technology committee, wrote to Kathy Hall, PHE’s director of Covid-19 testing strategy, to ask for details, after she admitted in an inquiry hearing that the government was attempting to recoup money spent on the tests. Ms Hall has until April 23 to respond.

After ordering 17.5m antibody blood tests, the government conceded that none had proven effective enough to be used. Scientists in Oxford had been validating tests from nine companies, including Wondfo and SureScreen.

On Friday, the Department of Health confirmed that at least 500,000 tests had been imported from China, but did not confirm nor deny a report that $20m had been spent on 2m tests from two companies alone.

In his letter, Mr Clark asked for details of how many and which companies had signed contracts with the government, how much was spent, how much money had been recovered so far and “why it was considered necessary to commit to pay for the antibody tests in advance of their effectiveness and accuracy being proven”.

Live Q&A: what podcasts are you listening to?

Something for the weekend.

We round up the best drama podcasts to listen to from around the world — join FT writers Sarah Hemming and Fiona Sturges for a live discussion at 12 and 5pm UK time.

Head to this piece to post your thoughts and questions and to read the discussion.

UK to expand coronavirus testing

Laura Hughes in London

Matt Hancock has announced that coronavirus testing will be expanded to the police, fire service and prison staff, as the government faces pressure to increase capacity.

Giving evidence to the health select committee, the UK health secretary said tests would also be made available to critical local authority workers and the judiciary.

Now we’ve got the curve under control, I want to be able to get back to the position that we can test everybody with symptoms and I anticipate being able to do that relatively soon because we’re increasing capacity.

Mr Hancock said there had been 18,665 tests in the 24 hours up to midday on Thursday, and that over 50,000 people that work in the NHS have now had tests and the government was considering but had “not yet been able to take forward” mass testing of asymptomatic staff within the health service.

Mr Hancock also revealed that ministers had considered imposing a “London-specific lockdown” before current measures were rolled out nationwide.

Football legend Norman Hunter dies of coronavirus

Andy Bounds in Huddersfield

Former footballer Norman Hunter has died of coronavirus at the age of 76. The towering centre-back, nicknamed “Bites Yer Legs” for his tough tackling, was the heart and soul of Don Revie’s Leeds United sides in the 1960s and 70s.

He made 726 appearances over 14 years and won two league titles among seven trophies, and was also in the England World Cup winning squad of 1966.

He still worked for the club on match day hospitality and, as tributes flowed in, the club website broadcast an old interview with him. “It has been a great life, absolutely brilliant,” Hunter said.

Italian deaths double since beginning of outbreak

Valentina Romei in London

The number of deaths in Italy has more than doubled since the coronavirus outbreak began, available data suggest, with more than 70 municipalities registering 10 times more people dying than last year.

Figures published on Friday by Italy’s office for national statistics (ISTAT) showed the amount of deaths from any cause across 1,700 towns doubling in the period between March 1 and April 4 compared with the same month last year.

The towns included in the data make up about 28 per cent of those in the country and were selected by ISTAT because they had complete data and had registered a 20 per cent increase in fatalities compared to the norm. As such, they are not representative of the whole country, but they suggest high mortality from coronavirus, particularly in the north of the country.

In the town of Bergamo, located north of Milan in the virus-hit region of Lombardy, the number of deaths rose to 729 between March and the beginning of April, compared with 151 in the same period last year, about five times higher.

In more than 70 municipalities, the number of deaths was at least 10 times higher than last year. In nearly 600 towns, about one-third of the sample, the number of people who died in the five weeks to April 4 was at least three times higher than over the same period last year.

Across the whole dataset, the number of deaths in those five weeks rose by 125 per cent for men and by 82 per cent for women, compared with the same period last year.

Iranian army parades equipment to fight coronavirus

Najmeh Bozorgmehr in Tehran

On Iran’s annual “army day”, the conventional military force held a parade to show off equipment for tackling the coronavirus outbreak.

Equipment for sanitising public places and setting up makeshift hospitals was demonstrated.

The limited unusual ceremony was in the absence of political leaders. President Hassan Rouhani on Friday thanked all armed forces — including the elite Revolutionary Guards — for helping the health sector.

Iran’s death toll went up by 89 on Friday compared with the day before and reached 4,958 individuals out of 79,494 confirmed cases.

Iran says it is close to curbing the spread of Covid-19 but remains wary of a rebound when life fully goes back to normal. In Tehran, businesses considered as having “low risks” to people’s health will resume working on Saturday after one month of closure.

Pakistan’s clerics defy restrictions on group prayer

Farhan Bokhari in Islamabad

The Pakistani government has tightened curbs on Muslim worshippers seeking to attend weekly prayers, amid signs of defiance from some of the country’s hardline clergy.

In Karachi, the southern port city with a population of more than 20m, local authorities tightened curbs on travel on Friday afternoon. A senior police officer speaking from Karachi told the FT that “even two people driving in a car will be turned back if they seemed to be heading to a mosque”, in a temporary reversal of a provision that allows no more than two people to travel together.

Prime minister Imran Khan’s government and Pakistan’s provinces have banned gatherings of more than five people at mosques during prayer times. Groups of worshippers have been restricted to employees of mosques and “imams” or prayer leaders.

Mufti Munibur Rehman, an influential cleric and head of the Moon Sighting Committee, this week said that Muslims will attend the evening taraweeh prayers in groups, after breaking their fasts, during Ramadan, the holy month which begins next week.

In Islamabad, the head of the notorious lal (red) mosque has called upon his followers to gather in large numbers for Friday prayers. The mosque was the scene of an armed clash in 2007 when militants inside the building fought a pitched battle for about a week with army commandos.

Germany makes progress in slowing spread of virus

Guy Chazan, Berlin bureau chief

Germany says it has made good progress in slowing the spread of coronavirus, bringing down a key statistic for viral transmission.

Lothar Wieler, head of the Robert Koch Institute, said that the “reproduction number” R, measuring the average number of new cases generated by an infected individual, had dropped below 1. “We have achieved a good interim result,” he said, with “several positive tendencies”.

He said “R” was 1 at the end of March but was now at 0.7. “That means that at the moment, one person who is infected is no longer infecting someone else,” he said. He also noted that the daily increase in cases of coronavirus infection was slowing down.

According to statistics from the institute, Germany has 133,830 cases of Covid-19, and 3,868 deaths from the disease.

Jens Spahn, health minister, said the pandemic had become “controllable” in Germany, largely thanks to the shutdown measures imposed by German authorities last month. He also noted that more people were now recovering from Covid-19 per day than new infections.

Northern Ireland revises Covid-19 death toll up by a third

Arthur Beesley in Dublin

Northern Ireland’s coronavirus death toll has been revised upwards by one-third after new data showed previously unreported fatalities in nursing homes and private residences.

On Friday, the region’s statistical agency said there had been 157 Covid 19-related deaths by April 10 — one-third greater than the 118 reported at the time by health authorities.

The region’s Public Health Agency reports only laboratory-confirmed Covid-19 deaths that took place mostly in hospitals, but data from the Northern Ireland Statistics and Research Agency are drawn from a wider base. Nisra includes hospital deaths but also fatalities in nursing and care homes, hospices and private residences where doctors cited suspected coronavirus infection in death certificates but did not carry out a test.

Nisra said 109 of the deaths it reported were in hospitals, 41 were in care homes and hospices and another seven were at residential addresses.

As of Thursday, the Public Health Agency reported 158 laboratory-confirmed Covid-19 deaths in the region. Additional Covid-related deaths in the seven days since April 10 will be reported later by the statistics agency. The death registration process means that its figures take longer to produce.

US crude prices hit another 18-year low

David Sheppard, energy editor

US crude oil prices dropped to another 18-year low near $18 a barrel on Friday, with energy markets still under pressure from a record glut created by the coronavirus pandemic.

The front-month West Texas Intermediate contract for May delivery, which expires early next week, lost as much as 9 per cent to trade down to $18.03 a barrel, the lowest level since 2002. The second-month contract for June delivery was steadier, trading flat at around $25.53 a barrel. Brent, the international benchmark, was also steady at $27.84 a barrel, but has lost almost $5 a barrel this week.

Crude prices have fallen this week despite a landmark US-backed deal by the Opec+ group of producers to cut production by almost a tenth of global supply, but traders have weighed that the collapse in demand is still far larger, with up to a third of global consumption lost to measures to restrict the virus’s spread. That has created volatile price moves as traders bet oil storage will rapidly fill up globally, including at the US crude benchmark’s delivery hub of Cushing, Oklahoma.

Roche to launch new antibody test

Donato Paolo Mancini in London

Swiss pharmaceuticals heavyweight Roche is launching an antibody test for coronavirus that it hopes will be available next month — potentially enabling health professionals to check whether millions have already had the virus or not.

As governments around the world plan an end to lockdowns, many are preparing to conduct widespread antibody testing to measure the true extent of coronavirus infection in their populations as part of the next phase of tackling the pandemic.

Roche said on Friday it was aiming to make its new Elecsys serology test available by early May in countries that accept the CE mark, a global standard. It is also working with the US Food and Drug Administration to obtain an emergency use authorisation there.

Antibody tests, crucially, can act as an indication of whether someone has had the virus in the past. PCR tests, instead, give an instantaneous snapshot of whether someone is currently infected or not.

Roche says its manufacturing capacity will reach the high double-digit millions by end of June. Severin Schwan, the company’s chief executive, told the Financial Times that after that the company “could easily get into the hundreds of millions”.

Read the full story here

Total number of Covid-19 cases worldwide climbs to 2.11m

Steve Bernard in London

Global new daily cases of Covid-19 rose by 81,419 on Thursday bringing the total to 2.11m.

The death toll increased by 6,996 yesterday. This does not include the additional 1,290 deaths reported by the Chinese city of Wuhan’s response team on Friday, which pushed China’s death toll to 4,632.

The UK announced a further three-week extension of the lockdown yesterday as the number of daily confirmed cases remained steady at around 5,000. The death toll however, has remained consistently high with another 861 people losing their lives yesterday. The total now stands at 13,729.

Turkey is still firmly in the acceleration phase as it registered a record 125 deaths on Thursday. For the ninth straight day the country has recorded more than 4,000 new cases. Yesterday a further 4,801 cases were confirmed, the highest total outside of the US.

The number of global recovered cases rose by a record 36,999 yesterday, leaving a total of 547,121 free from the virus.

Man Group assets fall by 13 per cent in first quarter

Owen Walker, asset management correspondent

Man Group, the world’s largest listed hedge fund, proved more resilient than traditional long-only managers during the recent market sell off, registering a 13 per cent fall in assets and modest inflows in the first three months of the year.

Listed investment managers have typically suffered asset falls of between 20 and 30 per cent over the period, with most reporting heavy client redemptions.

Man Group’s $500m of net inflows bucked the trend, it reported on Friday morning. Its overall assets under management fell from $117.7bn at the end of December to $104.2bn at the end of March.

But chief executive Luke Ellis said outflows had increased towards the end of the reporting period. “Our balance sheet and liquidity position remain robust, and we will proceed with our dividend as announced and continue with our share buyback as planned,” he added.

What you may have missed

Emmanuel Macron has warned that the EU faces a “moment of truth” on whether to become more than a single economic market by setting up a common mutual debt fund, with the future of the EU as a “political project” at stake. Read more of the FT’s exclusive interview with the French president in the Big Read.

China’s economy shrank at the start of the year for the first time in more than 40 years, after the fallout from the coronavirus pandemic ended an era of uninterrupted growth dating back to the late 1970s.

The Chinese city of Wuhan has added more than 1,000 deaths to its official count of lives lost to Covid-19 from additional sources, bringing the total death toll in the city to 3,869.

European markets opened higher after a report suggested a coronavirus drug developed by Gilead had shown positive results in a clinical trial, giving investors hope that a treatment could ease the pandemic and open up the global economy.

Donald Trump backed away from threats to force a quick reopening of the US economy, unveiling guidelines for states that set high hurdles to easing lockdown policies imposed in response to coronavirus and acknowledged that governors may choose when to lift the restrictions.

The World Medical Association, the body representing doctors globally, has intervened in the growing row over the World Health Organization’s alleged bias towards China, with an appeal to allow Taiwan back into the WHO.

South Korea reported its worst monthly job losses in more than a decade.

Euroclear halts sales process

Philip Stafford in London

Euroclear, the world’s largest central securities depository, has halted all work on a potential sale or initial public offering owing to the coronavirus crisis.

The Belgium-based group also announced it was postponing the approval of its dividend, set to be €82 per share, until the fourth quarter, following guidance from the Belgian central bank and the European Central Bank.

Euroclear, which is mutually owned by banks and exchanges, has been exploring options for more of its shareholders to sell their stakes, after several lenders sold their stakes to Intercontinental Exchange and the London Stock Exchange Group. The deals, over the past two years, accounted for 15 per cent of Euroclear’s equity and valued the company at more than €5bn.

The Euroclear board “has decided to stop all work on a tentative liquidity initiative, and wait until economic activity and market stability has been restored in a sustained way to consider the matter again,” it said in a statement.

A sale or listing has been under consideration by the board. Its moves were being closely watched by exchanges, private equity houses and banks amid a wave of consolidation among market infrastructure operators in Europe.

Outbreak continues to grow in Russia

Henry Foy in Moscow

Russia reported a sixth straight new record daily increase in coronavirus cases on Friday, as the outbreak continues to grow in the country.

Russia reported 4,069 new Covid-19 infections, a 15 per cent increase that takes its total number of cases to 32,007.

In the strongest sign yet that a month-long national holiday and a shutdown of major cities has not stemmed the spread, president Vladimir Putin on Thursday announced a postponement of the May 9 victory parade, one of the most important events of the Russian political calendar. This year’s event was to mark 75 years since the end of the second world war, but was deemed too dangerous to hold amid rising infections.

Wall Street analysts question investor excitement over virus drug

Biotech analysts on Wall Street have warned against over-reacting to hopes for a new coronavirus drug that could ease the pandemic.

A report in the medical press has suggested a coronavirus drug called ‘remdesivir’ developed by US pharma group Gilead had shown positive results in a clinical trial, sending Wall Street futures sharply higher.

Jefferies equity analysts said the excitement was “overdone in the near term”, and highlighted that the findings do not come from the later stages of clinical research.

We appreciate that the broader market is in a risk-on and glass-half-full environment and investors are looking for a good story.

Healthcare analysts at Evercore said:

Did remdesivir just “solve” Covid? No.

While “cautiously optimistic”, the bank’s head of large cap therapeutics research Umer Raffat highlighted challenges interpreting the data and that the trial excluded patients who needed mechanical ventilation.

Thomas Lee at research boutique Fundstrat said any treatment could be as important as the longed-for vaccine against coronavirus. But he had a warning over the market’s response:

[The virus] has compressed news/economic/financial cycles from months to days. What was normally 12 months of market moves is now happening in weeks….Financial markets are now starting to communicate a narrative that seems completely out of sync with what we know lays ahead.

EU car sales fall at fastest rate ever

Valentina Romei in London

The number of cars sold in the EU plummeted at the fastest pace on record as the coronavirus pandemic shut showrooms and discouraged consumers to commit to large purchases.

In March, about 567,000 cars were sold to EU consumers, less than half the nearly 1.3m in the same month in 2019, according to data from the European Automobile Manufacturers Association (ACEA).

The drop is the largest ever registered since the series began in 2004.

All the 27 countries registered a contraction in new car registrations in March, but Italy took the biggest hit with registration plummeting 85.4 per cent. Italy, the third-largest EU car market after Germany and France, was the first western country hit by the virus and the first to introduce a nationwide lockdown.

Demand also collapsed in France where car sales fell 72 per cent in Spain with a 69 per cent drop. The fall was less extreme in Germany, with a 37.7 per cent contraction.

ACEA calculated that the EU-wide production losses due to factory shutdowns amount to nearly 2m vehicles so far. The most production lost is estimated to be in Germany, the EU’s largest auto producer, with about 568,000 workers affected.

Germany confirms 3,380 new cases

Tobias Buck in Berlin

Germany reported 3,380 new coronavirus cases on Friday, an uptick compared with previous days that took the total number of infections to 133,830 since the crisis started.

According to official data from the Robert Koch Institute in Berlin, the number of Covid-19 dead rose by 299 to 3,868. That was the second-highest number of daily fatalities so far, but lower than the 315 dead reported on Thursday.

In relative terms, the number of new coronavirus cases rose by 3 per cent over the past 24 hours, while the number of deaths increased 8 per cent. Both figures are broadly in line with recent trends showing a notable deceleration in the spread of the virus.

The German government agreed with federal states on Wednesday that it would start unwinding some of the lockdown measures next week, with small and medium-sized shops allowed to reopen from Monday. Schools will start to reopen on May 4, though with an initial focus on students preparing for their school-leaving exams and pupils in the final year of junior school.

World Medical Association intervenes in WHO-China row

Clive Cookson in London

The World Medical Association, the body representing doctors globally, has intervened in the growing row over the World Health Organization’s alleged bias towards China, with an appeal to allow Taiwan back into the WHO.

In a letter to WHO Director General Tedros Adhanom Ghebreyesus, the WMA’s leaders said that the WHO’s failure to listen to early warnings from Taiwan about the Covid-19 pandemic, coupled with its decision to ignore Taiwan during much of the Sars crisis, were “errors that led to the world paying a high price”.

Miguel Jorge, president of the WMA, and Frank Montgomery, chair of the WMA Council, wrote: “The Covid-19 pandemic has illustrated with terrible consequences how wrong and damaging for global health it is to exclude Taiwan from unrestricted and effective participation in the World Health Organization.”

For several years, Taiwan was given observer status at the World Health Assembly, but in recent years it has been locked out by the WHO as a result of the ‘One China’ policy. The WMA argues that the inclusion of Taiwan is a health matter and not a political issue.

UK regulator extends loan relief to car finance and high-cost credit

Matthew Vincent

Britain’s financial regulator has extended the loan relief for borrowers impacted by coronavirus to users of motor finance products and high-cost credit – including payday loans, buy-now-pay-later deals and rent-to-own agreements.

Last week, the Financial Conduct Authority, announced that it was allowing holders of credit card and personal loans to apply for the same three-month payment holidays granted to mortgage holders back in March.

But debt charities had been concerned that some of the most vulnerable consumers who do not qualify for mainstream credit cards or loans – and instead rely on doorstep lending and other ‘subprime’ lending arrangements – would not be helped. Similarly, users of motor finance and leasing deals – such as personal contract purchase (PCP) plans – were not covered.

On Friday, the FCA said they would all be permitted similar payment freezes where it was in their interests.

In the case of high-cost credit, borrowers will be allowed a one-month interest-free payment freeze – the shorter time period reflecting the short-term nature of most loans and the fact that, unlike the credit card freeze, no interest will be accrued in the period.

In the case of motor finance, the payment freeze will be three months. In addition, customers coming to the end of a PCP plan but lacking the cash to cover the final ‘balloon’ payment to keep their cars must be provided with “an appropriate solution”.

Read: Car finance groups report surge in motorists seeking loan help

European markets rise in early trading

Myles McCormick in London

A historic contraction in China’s economy failed to halt a rally in European and Asian stocks as investors pinned their hopes on the emergence of a potential coronavirus treatment and the reopening of the US economy.

Europe’s Stoxx 600 opened 2.3 per cent higher, with gains of 2.8 per cent for Frankfurt’s Dax 30 and Paris’s Cac 40. London’s FTSE 100 was up 2.5 per cent.

The rise came after a report suggested a drug developed by Gilead had shown positive results in a clinical trial, giving investors hope that a treatment could ease the pandemic and open up the global economy. 

UK corporate news

Foxtons has launched an emergency fundraise for up to £22m through the placement of new shares after it reported that commissions earned by the estate agent during the first three weeks following lockdown were 47 per cent lower than the same period last year.

Flutter Entertainment, owner of Paddy Power and Betfair, reported 32 per cent year on year revenue decline, since UK and Irish horse racing had been suspended. A 46 per cent reduction in sports revenue was less than the group expected due to the continuation of racing in Australia and the US.

The Financial Conduct Authority has proposed further measures to directly support consumers facing payment difficulties due to coronavirus, including a 3-month payment freeze for certain customers on motor finance payments and high cost credit agreements.

Wealth manager Brewin Dolphin said that total value of its funds decreased by 14.6 per cent to £41.4bn due to negative market performance but the funds received net discretionary inflows of £400m in the second quarter of the year.

Mining giant Rio Tinto expects its capital expenditure to be reduced to $5-6bn, down from $7bn, in 2020 due to the impact of coronavirus and favourable exchange rates. The group said that all projects progressed well in the first quarter but its operations are now being affected by the pandemic.

Man Group, the world’s largest listed hedge fund, said that it plans to pay out its dividend as scheduled, despite funds under management falling 11.5 per cent to $104.2bn in the first quarter due to Covid-19 impacting global markets.

IMF approves $1.4bn emergency financing for Pakistan

Farhan Bokhari in Islamabad

The International Monetary Fund has approved $1.4bn in emergency financing to Pakistan to help the country meet its funding needs as it battles coronavirus.

The IMF and other financial institutions dealing with Pakistan have concluded that the country’s economy in the financial year to June will shrink by 1.5 per cent, down from earlier estimates of an expected annual growth of 3 per cent.

In an announcement late on Thursday following the approval of the loan, Geoffrey Okamoto, the IMF’s first deputy managing director said:

The outbreak of Covid-9 is having a significant impact on the Pakistani economy. The domestic containment measures, coupled with the global downturn are severely affecting growth and straining external financing. This has created an urgent balance of payments need.

Indian central bank hints at further rate cuts and unveils new measures

Benjamin Parkin in New Delhi

The governor of the Reserve Bank of India hinted at further rate cuts ahead and announced a series of measures to prop up the country’s banking sector as the central bank steps up efforts to combat the destructive effect of coronavirus on India’s economy.

In a televised address, Shaktikanta Das said that inflation could fall below the RBI’s target of 4 per cent, creating room for potential cuts. India’s benchmark repo rate is already at an all-time low of 4.4 per cent after a cut last month.

“Such an outlook would make policy space available to address the intensification of risks to growth and financial stability brought on by Covid-19. This space needs to be used effectively and in time,” he said. “The RBI will monitor the evolving situation continuously and use all its instruments to address the daunting challenges posed by the pandemic.”

Mr Das said that the RBI would pump liquidity into the system, including through a lending drive worth Rs500bn (US$6.5bn), in order to increase fund flows to banks and shadow banks, with the latter considered particularly vulnerable.

Mr Das also said the RBI would also relax the current rules that require banks to report non-performing loans after 90 days in light of the disruption, among other measures. The Nifty Bank index was 2.5 per cent higher after the announcement.

The health of India’s financial system has been of concern since the lockdown started in late March, with bank stocks falling precipitously in recent weeks. Corporate defaults had been on rise even before the pandemic as India’s economy battled slowing growth.

Foxtons looks to raise £22m in share placement

Foxtons has become the latest company to launch an emergency fundraising as the estate agency risks running out of cash should the UK’s lockdown continue throughout the summer.

The group said this morning it would carry out a share placement to raise up to £22m to shore up its balance sheet.

If the current restrictions in the UK last until the end of August and property markets are slow to recover subsequently, Foxtons’ said it could face a “liquidity gap”, with revenues falling by 78 per cent in the second and third quarter of the year.

Flutter says revenue tumble dulled US and Australian horse racing

Alice Hancock

Flutter, the gambling company behind the Paddy Power and Betfair brands, said that the impact of coronavirus on its sports revenues had not been as bad as anticipated due to the continuation of some horse racing in the US and Australia.

Since racing in the UK and Ireland was suspended on March 16, the group said that overall revenues had declined 32 per cent on a year-on-year basis but that the 46 per cent reduction in its sports revenues was “less than expected” after some races in the US and Australia took place behind closed doors.

In mid-March, the bookmaker warned that the cancellation of sports fixtures due to coronavirus would cause a £110m hit to full-year earnings with the closure of its UK and Irish shop estate incurring a further £30m in lost earnings per month.

On Friday the group, which is more exposed than its rivals to sports revenues said that its original guidance still stood but it was “monitoring closely the outlook”.

Gaming revenues across the Paddy Power and Betfair brands had increased 15 per cent since the shutdown as more consumers are cooped up at home or turn to games to replace sport. In the US, gaming revenues were up about 200 per cent.

On Wednesday, the British Horseracing Assocation announced an indefinite extension to the suspension of race meetings but said that it hoped to resume some races in May.

European stocks set to open higher despite drop in China GDP

Philip Georgiadis in London

London’s FTSE 100 is set to record significant gains at the opening bell, as investors brush off a historic contraction in Chinese GDP and concentrate on emerging plans to reopen some economies around the world.

Futures pointed to gains of around 3 per cent for the UK’s blue-chip index, which would help it catch up with a significant move higher this month for US stock markets.

Elsewhere in Europe, the continent-wide Stoxx 600 was set to open 2.3 per cent higher.

A study showing a drug made by US pharma company Gilead could be effective in treating coronavirus has also boosted sentiment, and sent US markets sharply higher in after-hours trading last night.

The positive mood comes despite overnight data that showed the world’s second-biggest economy shrank by 6.8 per cent year-on-year in the first quarter, due to disruptions caused by coronavirus-induced lockdowns.

The Chinese government only began reporting quarterly economic growth estimates in 1992 but the last time it officially acknowledged a year-on-year fall in output was for 1976.

Myanmar releases 25,000 prisoners due to coronavirus risk

John Reed in Bangkok

Myanmar on Friday announced the release of almost 25,000 prisoners, more than a quarter of the country’s total, amid calls to ease overcrowding in jails because of the risk of coronavirus transmission.

President Win Myint announced the release, which marked the country’s traditional new year holiday, known as Thingyan, saying that it was intended “to bring delights to the citizens of Myanmar and taking into consideration humanitarian concerns”.

The south-east Asian country has reported 65 cases of Covid-19 to date and four deaths, but infection rates are widely believed to be higher because of the low number of people tested.

Friday’s release of 24,896 prisoners was Myanmar’s largest ever such amnesty.

The International Committee of the Red Cross and human rights groups have urged countries with crowded prisons, which in Asia include Myanmar, Cambodia, and the Philippines, to release inmates held on minor offences or who have underlying health conditions.

According to Human Rights Watch, Myanmar’s prison system holds an estimated 92,000 prisoners, despite having an official capacity to hold only 66,000.

Cathay Pacific closes US cabin crew bases with loss of 300 jobs

Primrose Riordan in Hong Kong

Cathay Pacific, which has grounded nearly all of its fleet, has closed its three cabin crew bases in the US and laid off nearly 300 staff as it desperately seeks further savings.

“As a result of the Covid-19 pandemic which has virtually halted global travel, Cathay Pacific has made the difficult decision to close its US cabin crew bases,” the company said.

Cathay said the move would affect 286 staff based in New York, San Francisco and Los Angeles.

The company previously said it was looking to furlough workers at international bases it was not currently flying to.

The airline said on Thursday that it would operate at just 3 per cent of its normal capacity in April and May. It said it expected to carry fewer than 1,000 passengers each day this month, from the 100,000 the airline usually carries each day.

Asia-Pacific stocks rally past China’s sharp GDP contraction

A historic contraction in China’s economy failed to halt a rally in stocks across the Asia-Pacific region, as investors pinned their hopes on emerging plans to reopen the US economy.

Official Chinese data on Friday showed that the world’s second-biggest economy shrank by 6.8 per cent year-on-year in the first quarter, but investors were unshaken by the news.

China’s CSI 300 index rose 1.2 per cent and Hong Kong’s Hang Seng was up 2.3 per cent. Japan’s Topix index added 1.1 per cent, while Australia’s S&P/ASX 200 climbed 1.7 per cent.

“It’s not actually a big miss compared to the market consensus,” Michelle Lam, Greater China economist at Société Générale, said of China’s first-quarter data.

Read the full report here

Indian police arrest 17 in ambulances smuggling migrants home

Amy Kazmin in New Delhi

Indian police have arrested 17 people after discovering an operation to smuggle stranded migrant workers back to their rural hometowns in ambulances, with the workers disguised as ailing hospital patients and their relatives.

Police in Gurgaon, a suburb on Delhi’s outskirts, discovered the operation after stopping two ambulances, each carrying five people — one with an intravenous drip seemingly attached to his arm, and another lying on a stretcher. Others posed as relatives of the ailing “patients.” The occupants carried documentation and referrals, seemingly from a hospital.

However, police discovered that the hospital on the documents’ letterheads was not operational, and that the “patients” and their relatives were migrants who had been working as tailors in export-oriented garment factories.

Each migrant worker had agreed to pay Rs9,000 ($117) for a trip back home to their villages in Bihar, more than 1,200km from Delhi.

The mastermind of the operation, police said, was a former hospital manager, who had teamed up with ambulance owners to start the business of ferrying stranded migrants home.

The arrested people comprised 10 migrants, four ambulance drivers and two contractors. All were jailed for 14 days.

The arrests highlight the desperation of India’s migrant workers, such as those pictured attempting to walk home from Delhi, who were caught out by the surprise lockdown.

Millions have been left stranded for weeks on end, with no income, dependent on food handouts to survive, and desperate to get home.

Indian authorities have estimated that 10m migrant workers are stuck in cities, and are now being fed by a combination of government kitchens, charitable groups and other donors.

Organisations tracking the plight of migrants say the food aid being provided is far from sufficient for the numbers of people who need it, and that hunger is widespread.

Wuhan adds 1,290 fatalities to coronavirus death toll

Christian Shepherd in Beijing

The Chinese city of Wuhan, ground zero for the coronavirus pandemic, has added more than a thousand deaths to its official count of lives lost to Covid-19.

After checking online data against information gathered in person from hospitals, police stations, funeral homes and other sources, the city’s coronavirus response team added 1,290 new deaths to the tally, bringing the total to 3,869, it said in a statement on Friday.

Patients who died at home without diagnosis in the early stages of the outbreak, hospitals left out of the online reporting system and overburdened institutions “failing to report or misinforming” authorities during the peak period led to undercounting, the Wuhan government said.

Doubts about the official death count in Wuhan intensified in recent weeks, as a gradual relaxation of the city’s lockdown led families to flood funeral homes to pick up the ashes of their relatives.

Kazakhstan eyes Asia start-ups as coronavirus hits oil price

Mercedes Ruehl in Singapore

Kazakhstan’s government will invest in start-ups across south-east Asia as part of efforts to diversify central Asia’s largest economy away from oil and gas, where prices have been slammed by the coronavirus pandemic.

The country’s state wealth fund, Baiterek National Managing Holdings, will be the anchor investor in a vehicle run by Singapore-based Quest Ventures. The fund has also been backed by Pavilion Capital, which is owned by Temasek Holdings, Singapore’s state investment company.

At $50m, the fund is small but it forms part of a broader push to create an economic corridor between central and south-east Asia.

Adil Nurgozhin, chairman of Baiterek subsidiary QazTech Ventures, called the deal an “important step” in connecting the regions’ economies.

Kazakhstan, sandwiched between regional powers China and Russia, is looking to diversify its portfolio investments into different parts of the world, according to people familiar with the situation.

Read more here.

Virgin Australia warns of competition threat if bailout refused

Jamie Smyth in Sydney

Virgin Australia has warned it could take up to 20 years for a new airline to fully establish itself and provide competition to break a Qantas monopoly if the government fails to bail out the airline.

“We are clearly in crisis mode. We are an airline and an industry under significant scrutiny on almost an hourly basis,” Stuart Aggs, Virgin chief operating officer, told a trade union forum on Friday.

Canberra has so far balked at a request to provide a A$1.4bn ($892m) loan to Virgin and suggested the foreign-owned carrier is negotiating with private investors about a potential investment that could provide a lifeline to the carrier.

The matter has become a major political issue with the Labor party and unions warning that allowing Virgin to collapse would have a calamitous impact on the wider economy.

Virgin would not comment at the forum on any discussions with private investors but called for an industry-wide solution which “put rivalry aside” to weather the coronavirus outbreak together.

Mr Aggs told the forum the tourism industry would experience a significant blow if the airline went out of business and raised the spectre of the collapse of Ansett Airlines in 2001, which drastically reduced competition in the Australian market for several years.

The chief executive told the forum it took 20 years for Virgin to establish itself as an effective competitor to Qantas after the Ansett collapse and even now the airline only held 30 per cent market share.

“One of the things we stand to lose is that 20 years of experience,” said Mr Aggs. “Is the government prepared to wait 20 years for that experience to be built back up again from a competitive sense? I suspect not.”

South Korea hit by biggest job losses in more than a decade

Edward White in Wellington and Song Jung-a in Seoul

South Korea has reported its worst monthly job losses in more than a decade, highlighting the economic challenge the government faces from the coronavirus outbreak.

The overall number of employed people in Asia’s fourth-largest economy fell by 195,000 to 26.6m, the biggest decline since May 2009, according to Statistics Korea data released on Friday. The number of temporary employees fell by 420,000, the worst monthly figure since December 1998.

The number of unemployed people actively seeking work fell to 1.18m in March, down 17,000 from a year earlier, as many people who lost jobs gave up efforts to find new employment and new hires were postponed amid the coronavirus pandemic, according to officials.

The data put the spotlight on President Moon Jae-in’s ruling Democratic party which on Wednesday won its first outright majority in the country’s National Assembly in 16 years, in a result that reflected a positive public view of Seoul’s response to the global pandemic.

Officials in Seoul have already announced a series of measures to cushion the blow from widespread disruptions and weakening demand hitting both the country’s export-led manufacturing industry and domestic spending. The measures include record stimulus packages totalling more than $124bn and record-low interest rates.

The IMF expects South Korean economy will shrink by 1.2 per cent this year, down from an earlier forecast of 2.2 per cent growth. That would be lower than the 0.7 per cent contraction seen in the wake of the global financial crisis in 2009.

Still, analysts at Fitch Solutions said the election result should assist with efficient policymaking during the pandemic: “The supermajority also allows the government to take further proactive steps to shore up the economy, should the need arise.”

South Korean health officials on Friday reported 22 new cases of coronavirus, taking the total caseload to 10,635. While the number of recovered patients is outpacing new infections, one more fatality has been linked to Covid-19, taking the country’s total death toll to 230.

Asia-Pacific stocks hold on to gains despite China GDP contraction

Hudson Lockett in Hong Kong

Shares across the Asia-Pacific region rallied on hopes over a pathway for reopening the US economy following the coronavirus pandemic, even as China reported its first economic contraction in four decades.

China on Friday morning reported a year-on-year fall in gross domestic product of 6.8 per cent for the first quarter, when lockdowns across the country severely disrupted the world’s second-largest economy.

But stocks in the region were holding on to earlier gains, with China’s CSI 300 index up 1 per cent and Hong Kong’s Hang Seng up almost 2 per cent. Japan’s Topix index rose 1.4 per cent, while Australia’s S&P/ASX 200 climbed 2.3 per cent.

Investors were bullish despite the sharp drop for China’s economy thanks in large part to rising hopes for a recovery as more countries look towards eventual re-opening.

Futures markets pointed to a boost for US stocks later in the day, with the S&P 500 tipped to rise 3.3 per cent on optimism over tentative plans to restart the shuttered US economy. Guidelines released by President Donald Trump acknowledged it was up to the governors of individual states to determine when to lift social distancing restrictions.

China’s economy shrinks for first time in 40 years

Thomas Hale in Hong Kong and Xinning Liu in Beijing

China’s economy shrank at the start of the year for the first time in more than 40 years, after the fallout from the coronavirus pandemic ended an era of uninterrupted growth dating back to the late 1970s.

Gross domestic product in the first quarter plunged 6.8 per cent year-on-year, the National Bureau of Statistics said on Friday.

The historic contraction in China, the engine of global growth for the past two decades, is the starkest economic signal to emerge from a pandemic that originated in Wuhan and has gone on to wreak havoc around the world.

The official data come in the same week that the International Monetary Fund warned of the worst global economic outlook since the Great Depression, with output losses this year expected to far exceed those that followed the financial crisis of 2008.

Read more here

AIIB doubles coronavirus funding available to $10bn

The Beijing-based Asian Infrastructure Investment Bank has doubled the funds available from its Covid-19 crisis facility to $10bn following a spike in demand for loans.

The development bank said requests for funding had exceeded the $5bn originally allocated for pandemic-related projects.

“We are facing a formidable challenge, with the depth and severity of the crisis growing with each passing day,” said Jin Liqun, AIIB president and chairman. “It was imperative that we respond to the urgent and extraordinary scale of demand from our members to significantly increase the scope of our response.”

The doubling comes days after the Asian Development Bank said it would triple its funding to $20bn to help member states handle the economic fallout of the coronavirus pandemic.

Projects the AIIB is currently reviewing include a $500m plan to purchase equipment and detection capacity in India, while Indonesia has requested $250m to strengthen hospital readiness and testing. A $355m emergency health project for China was approved earlier this month.

The AIIB did not outline the terms of the loans. The China-backed multilateral lender said it does not offer concessional lending, but said it recognises the need to be flexible with the tools it does have.

Separately, Liu Kun, China’s finance minister, called on the World Bank to suspend debt payments for the poorest countries and to outline a debt suspension timetable for these nations.

“If [the World Bank Group] fails to participate in collective actions for suspending debt service payments, its role as a global leader in multilateral development will be seriously weakened, and the effectiveness of the initiative will be undermined,” Mr Liu said.

El Chapo joins Mexican virus fight from US prison

Jude Webber in Mexico City

He may be jailed for life in a maximum-security US prison, but notorious drug lord Joaquín “El Chapo” Guzmán has joined the coronavirus effort in his native Mexico.

One of his daughters, Alejandrina Guzmán, has been distributing cardboard boxes emblazoned with his moustachioed face containing toilet rolls, oil, packets of soup, biscuits, beans and rice to elderly people, according to posts on social media by the El Chapo 701 clothing company she runs.

The number corresponds to the drug lord’s one-time ranking in the Forbes rich list. The company also makes face masks, pictured.

Ovidio Guzmán López – a son of the jailed former Sinaloa cartel chieftain whose attempted capture last year sparked a siege of the state capital, Culiacán – posted a TikTok video of elderly people receiving their care packages which ended with the image of a man draped in a Mexican flag.

Mexican President Andrés Manuel López Obrador caused a storm two weeks ago when he went out of his way to greet El Chapo’s 90-year-old mother and offered to help press her case with US authorities to allow her to see her son before she died.

El Chapo’s largesse in his local community is widely believed to have helped him remain invisible to the authorities for 13 years after the first of his two jailbreaks.

Mr López Obrador has brought forward pension payments to the elderly and is offering 2m small loans as part of a package of measures to help people weather the economic fallout of the pandemic, and says his main focus will be on Mexico’s poor.

Mexico had 6,297 confirmed infections and 486 deaths but health authorities admit the real numbers are at least eight times higher.

New Zealand wins plaudits for coronavirus approach

Jamie Smyth in Sydney

Four weeks after imposing one of the world’s strictest lockdowns, New Zealand is on course to eliminate the coronavirus.

Unlike most western nations, which are aiming to suppress the virus, the Pacific nation of 5m people has set a goal of completely snuffing out the virus to enable the progressive reopening of the economy.

New Zealand’s remote location, tough measures and low level of international connections are limiting the spread of coronavirus with 1,401 confirmed and probable cases and nine deaths. On Thursday, just 15 new cases were reported, the lowest number of new infections since March 22.

Read more here.

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The Bank of Mexico reasserted its autonomy and turned down a request from President Andrés Manuel López Obrador to advance some of the expected windfall on its foreign currency reserves by several months as the country fights coronavirus, stressing the need to respect the law.

A group of US House Republicans has called for the resignation of World Health Organization head Tedros Adhanom Ghebreyesus, while urging President Donald Trump to continue funding the global body if the director-general resigns.

Brazilian leader Jair Bolsonaro on Thursday fired his health minister following an acrimonious feud between the two men over the president’s vocal opposition to physical distancing measures.

US governors from seven mostly mid-western US states – Michigan, Ohio, Wisconsin, Minnesota, Illinois, Indiana and Kentucky – agreed to co-ordinate moves to re-open their economies, in the latest effort to ensure they return to normal in a way that does not hurt their neighbours.

John Williams, president of the New York Fed, has warned that the “full scale of the economic consequences is still unknown” when it came to the coronavirus pandemic, as he called for “innovative thinking and bold action” in the US response.

Facebook head Mark Zuckerberg has cancelled all large physical events at the social media company through to June 2021 in a ramped-up effort to limit the spread of coronavirus.

Asia-Pacific stocks climb ahead of China GDP data

Asia-Pacific stocks gained on Friday morning ahead of China’s gross domestic product figures for the first quarter in what is expected to be the first year-on-year decline in four decades.

The Topix in Japan gained 1 per cent, South Korea’s Kospi climbed 2.1 per cent and the S&P/ASX 200 in Australia was up 0.3 per cent. S&P 500 futures pointed to a 2.9 per cent gain when US markets reopen.

Economists polled by Reuters forecast a 6.5 per cent contraction in China’s GDP for the first three months of the year following strict lockdowns across the country to stem the spread of the virus that has crimped economic activity.

Overnight on Wall Street, the S&P 500 inched higher after a choppy trading session amid optimism over plans to restart global economies, but as figures showed US unemployment claims jumped by 5.2m last week. Goldman Sachs cautioned that equity markets had rallied “too far too fast”.

Latin America faces prospect of another ‘lost decade’, IMF warns

Jude Webber in Mexico City

Latin America faces the prospect of another “lost decade” as the coronavirus crisis wreaks havoc on economies across the region, Alejandro Werner, the IMF’s Western hemisphere director, said.

The global lender, which has received 16 requests for emergency aid from countries in the region, forecast a contraction of 5.2 per cent for Latin America this year, after a 0.1 per cent fall last year. Its two biggest economies, Brazil and Mexico, are forecast to shrink 5.3 per cent and 6.6 per cent respectively.

Despite hopes for a bounce in 2021, with regional growth of 3.4 per cent, Mr Werner told an online news conference that Latin America “has in front of it the spectre of another lost decade” in terms of income per capita from 2015-22.

Growth next year will not make up for commodity price shocks that triggered recession in Brazil, balance of payment crises suffered for example in Argentina and Ecuador and now the Covid-19 shock, he said.

Debt crises in Latin America in the 1980s triggered what was dubbed the “lost decade” when Mexico and other countries were unable to service their debt.

Singapore reports record daily rise in new infections

Stefania Palma in Singapore

Singapore set another record for daily increases in coronavirus cases, reporting 728 new infections on Thursday evening that take the country’s total to 4,427.

The number of new cases represents a jump of more than 60 per cent in 24 hours.

The city state is fighting a new wave of infections driven by outbreaks in its foreign worker dormitories, where the risk of contagion is high given the often crowded living quarters.

Thousands of migrant workers live in dormitories such as Cochrane Lodge 2, pictured, which has been used as an isolation facility.

About 90 per cent of Thursday’s patients were linked to these structures. None of the new infections was imported while about 20 per cent had yet to be linked to previously confirmed cases.

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