Coronavirus latest: Trump calls for even more Fed cutting

Coronavirus latest: Trump calls for even more Fed cutting

3/3/2020, 8:40:24 PM

Trump donates Q4 salary to fight against coronavirus

Donald Trump donated his fourth-quarter salary to the US Department of Health and Human Services to support the fight against coronavirus, a White House spokesperson said.

The check was in the amount of $100,000.

The president, who by law is required to be paid, has pledged to donate his salary while in office. In previous quarters, Mr Trump has made donations to other causes including national parks and efforts to combat the opioid epidemic.

3/3/2020, 8:06:38 PM

FOMC member Mester cuts US forecasts on coronavirus impact

Brendan Greeley in Washington

A voting member of the Fed’s rate-setting committee has lowered her growth forecasts for the first half of 2020 as the Coronavirus continues to spread in the US, saying that the “magnitude and duration of the economic effects of the virus are highly uncertain.”

The virus “will weigh on US growth in the at least during the first half of the year, with a pullback in spending by households and businesses,” said Loretta Mester, president of the Cleveland Fed, according to prepared remarks for a scheduled event in London.

The size and duration of the economic shock were difficult to predict, she said, adding that “Heightened and persistent uncertainty can affect the economy. It raises the possibility that negative effects on consumer and business sentiment and a pullback in investor risk-taking could last after the spread of the coronavirus has stabilised.”

Read more here.

3/3/2020, 8:00:12 PM

UAE to close schools for 4 weeks

By Simeon Kerr in Dubai

The United Arab Emirates is to close schools and universities for four weeks from Sunday as the Gulf state ramps up measures to contain the spread of coronavirus.

The ministry of education said state and private educational establishments would bring forward spring holidays scheduled for March 29-April 12, using remote learning over two weeks in a bid to ensure educational continuity. The move follows the closure of nurseries.

The UAE on Tuesday reported six new cases, bringing its total to 27, according to the state news agency. The virus has been spreading through the Gulf as nationals return from Iran, where an outbreak has claimed 77 lives from among more than 2,300 cases.

The new cases were discovered while examining those who had come into contact with two infected staff members of a team at the UAE tour, a major cycling race, that ended early last week, leaving athletes including four-time Tour de France champion Chris Froome briefly quarantined. Other participants are still being held at hotels in Abu Dhabi.

3/3/2020, 7:33:53 PM

US stocks sink more than 3% after 10-year Treasury yield breaks 1%

US stocks tumbled more than 3 per cent in afternoon trade after the yield on benchmark 10-year Treasuries fell below 1 per cent for the first time ever, with an emergency rate cut from the Federal Reserve earlier in the day failing to prop up markets.

The S&P was down 3.2 per cent, lining the benchmark index up for its eighth drop in nine sessions. This followed Monday’s 4.6 per cent surge as investor hopes grew that global central banks would step in to support the economy.

Tech stocks were hit hard, with the Nasdaq Composite down 3.4 per cent, while the Dow Jones Industrial Average dropped 3.2 per cent.

The yield on the 10-year US Treasury was down 12.4 basis points at 0.964 per cent as its price soared.

Half an hour into trading on Tuesday, the Federal Reserve announced an emergency interest rate cut, reducing its benchmark borrowing rate by half a percentage point to a range of 1 per cent to 1.25 per cent.

Investors headed to other havens, such as gold, and pushed the price of the yellow metal 2.8 per cent higher to $1,636 an ounce.

3/3/2020, 7:30:07 PM

Eurozone 2020 growth forecast cut to 7-year low by Oxford Economics

The 2020 economic growth outlook for the eurozone was cut to a seven-year low by economists at Oxford Economics, who added the coronavirus outbreak needs stronger policy responses.

On Tuesday, they cut their forecast for GDP growth to 0.6 per cent, down from 0.8 per cent previously, as the global economic damage from the coronavirus outbreak is “broader and deeper” than they had previously thought.

“We think the ECB will err on the side of caution to safeguard financial and credit conditions, and to protect investment prospects,” Oliver Rakau, economist at Oxford Economics, said. “We now expect the ECB to deliver a modest but broad easing package: tweaks to the [targeted longer-term refinancing operations] in March followed by a 10bps deposit rate cut and a rise of €5bn in monthly corporate bond QE in April.”

3/3/2020, 7:17:49 PM

Coronavirus conspiracy theories sow distrust in health authorities, researchers say

Chris Tighe in Newcastle

Coronavirus is a breeding ground for conspiracy theories that are harmful to society, according to researchers at Northumbria and Mainz Universities.

The belief that evil powers are pursuing a secret plan, often related to health, is widespread in every society, say the academics, Daniel Jolley, senior lecturer in psychology at Northumbria University and Pia Lamberty, researcher in social and legal psychology at Johannes Gutenberg University of Mainz.

One coronavirus conspiracy theory proposes, they say, that it is a bio-weapon engineered by the CIA to wage war on China. Others are convinced the UK and US governments introduced it to make money from a potential vaccine.

Research shows conspiracy theories tend to arise in moments of crisis in society, like terrorist attacks and rapid political and economic changes. Amid uncertainty and threat – such as virus outbreaks – they seek to make sense of a chaotic world. The researchers argue such ideas can be dangerous because medical conspiracy theories have the power to increase distrust in medical authorities and make people less likely to follow health advice. They may find scapegoats or resort to dangerous alternative “healing” approaches such as drinking bleach.

The researchers say it is possible for governments to intervene to stop misinformation and conspiracy theories getting out of hand with campaigns promoting counter-arguments.

Games such as Bad News, in which people can take the role of a fake news producer, have, they say, been shown to improve people’s ability to spot and resist misinformation.

3/3/2020, 7:00:33 PM

US 10-year falls below 1% for first time

Colby Smith in New York

The 10-year US Treasury yield dropped below one per cent for the first time on Tuesday, after the Federal Reserve delivered its first emergency rate cut since the financial crisis in order to stave off the long-term economic impact from the spread of the coronavirus.

The yield, which moves inversely to price, on the 10-year Treasury dropped to a fresh all-time low of 0.999 per cent in afternoon trading in New York. The 10-year Treasury is one of the most important interest rates in global finance, underpinning borrowing and savings rates across the globe.

3/3/2020, 6:57:46 PM

Americans should be ready to ‘take a break’ from daily activities – health officials

James Politi in Washington

A senior US health official said Americans should be prepared to “take a break” from their daily activities to stifle the spread of the coronavirus disease, as more than 100 cases and six deaths have been reported in the world’s largest economy.

In a briefing with reporters on Tuesday, Nancy Messonnier, director of the National center for immunisation and respiratory diseases at the Centers for Disease Control and Prevention (CDC) said the spread of coronavirus within the US had gathered pace and the priority was now to contain it.

“What is happening now in the US may be the beginning of what is happening abroad,” Dr Messonnier said.”We ask for people’s patience and understanding and mostly importantly their cooperation,” she added.

Dr Messonnier said that while most cases of coronavirus were mild, older patients with underlying health conditions were more at risk and Americans should accept changes to their daily routine to avoid contagion. “So staying home when you are sick is really important — don’t let the illness spread beyond you.”

The CDC has been criticised for rolling out functioning testing kits too slowly in recent weeks, reducing visibility into the spread of the disease within the US, but Dr Messonnier said the CDC would have furnished 75,000 kits to local and state health authorities by the end of the week.

3/3/2020, 6:24:28 PM

IMF and World Bank to conduct their spring meetings in ‘virtual format’

The IMF and World Bank will both conduct their spring meetings in “virtual format” as a result of health concerns related to the spread of the coronavirus.

Kristalina Georgieva, IMF Managing Director, and David Malpass, World Bank group president, said in a joint statement on Tuesday: “We remain fully committed to maintaining a productive dialogue with our stakeholders and will leverage our IT-related and virtual connection capabilities to the fullest to hold our essential policy consultations with the membership.”

A growing number of companies and events organisers all over the world have decided to postpone or cancel meetings and functions as a result of the increasingly global spread of Covid-19.

3/3/2020, 5:50:36 PM

New York auto show moving ahead as planned

The New York International Auto Show is moving ahead to kick off the annual event next month as scheduled, organisers said.

We are in communication with state and local officials and the Jacob K. Javits Convention Center, and, at this point, there are no plans to cancel any shows at the facility due to coronavirus. The Javits Center and the Auto Show are taking precautionary measures inside the venue while the state and local agencies are taking steps to limit the spread of respiratory viruses.

The Javits Center in Manhattan recently has installed hand-sanitizing stations and ramped up cleaning efforts, among other measures. The auto show also will have vehicle detailing companies use disinfectant.

The New York auto show is scheduled to open to the public on April 10.

The Geneva International Motor Show announced last week it would cancel the event. Some manufacturers have shifted to live video streams and other digital alternatives.

3/3/2020, 5:39:30 PM

Spain wants some sports events to close doors to fans

Daniel Dombey in Madrid

Spain has called for large scale sports events with teams from affected areas — such as China, northern Italy, South Korea and Iran — to be held behind closed doors.

The recommendation is likely to affect a Champions League match between Valencia and Atalanta of Bergamo scheduled for March 10 as well as other fixtures with Italian teams.

“It doesn’t make sense for large groups of people to come from places where this same kind of sports events are restricted,” said Salvador Illa, Spain’s health minister.
He also called for conferences of medical personnel to be suspended. “We need health professionals to be in the best conditions and available in the coming weeks,” he said.

Spain has reported around 150 cases of coronavirus.

3/3/2020, 5:38:34 PM

Opec should deepen supply cuts, says advisory board

Anjli Raval in London

An advisory body to Opec and its allies has recommended that producer countries deepen their oil supply cuts by another 600,000 to 1m barrels a day in the second quarter.

The move, in response to the spread of the deadly coronavirus outbreak and its potential impact on economic growth and crude consumption, has made the way for bigger than initially anticipated extra cuts.

The technical committee, which includes representatives from Saudi Arabia and Russia, are meeting in Vienna ahead of this week’s meeting of ministers.

This would imply supply curbs of 2.7-3.1m b/d total although some analysts say that Saudi Arabia – Opec’s defacto leader – seeks to surprise the market further and may announce even larger cuts.

Oil producers are trying to stem a fall in oil prices that have dropped from above $71 a barrel in January to $52.33 a barrel on Tuesday as the global economy and oil demand takes a hit.

3/3/2020, 5:18:11 PM

Futures industry group cancels Florida conference

Philip Stafford in London

The Futures Industry Association has cancelled its big annual derivatives conference in Boca Raton, Florida, next week on concern about the impact of Covid-19.

The well-established event, in its 45th year, normally draws bosses of the world’s biggest exchanges, as well as policymakers, hedge funds, bankers and lawyers from all around the world.

Intercontinental Exchange’s Jeff Sprecher, the London Stock Exchange Group’s David Schwimmer and Hong Kong Exchanges and Clearing’s Charles Li were set to appear at the event, as was Ken Griffin, the US hedge fund billionaire, the US’s chief agriculture negotiator Gregg Doud and Heath Tarbert, chairman of the Commodity Futures Trading Commission.

The FIA will not reschedule the event.

3/3/2020, 5:09:17 PM

More UK schools close

Bethan Staton in London

More UK schools closed on Tuesday, including Hilbre High School in the Wirral after a parent tested positive for coronavirus. A statement described the move as a “precautionary measure” and said the school would re-open on Friday after a deep clean.

Schools including Wimbledon College, Dulwich Prep and St Cecilia’s school in London, and a group of three academies in Wolverhampton, have so far closed due to the virus, with most set to re-open next week.

Paul Whiteman, general secretary of school leaders’ union NAHT, said decisions to close schools would be based not just on the chances of infection but other elements affecting children’s safety, like safe staffing levels.

“School leaders will consult with their governors, local authorities… and the latest government advice to decide what is best to ensure everyone’s health and safety,” he said.

At Croydon High School, a private girls’ secondary school in south London, headteacher Emma Pattison said senior staff were meeting every other day to plan for possible closures, including preparing staff on remote learning. She said the school would follow Public Health England’s advice in the event of possible closure.

3/3/2020, 5:03:24 PM

University cancels graduation over coronavirus fears

Andrew Jack in London

The University of Buckingham was one of two universities that on Monday cancelled March graduation ceremonies over fears of the risk of coronavirus.

The action is one of the most high-profile mitigation measures taken so far in the UK higher education sector as the virus spreads, and reflects the fact that 40 per cent of its students are from other countries. Around 2,500 students and their families from around the world were expected to attend.

In a letter to staff and students, Sir Anthony Seldon, the vice-chancellor, said: “I know that for colleagues, as for students, Graduation is the culmination and highlight of the whole year. I’m deeply sorry to have taken the decision. Many factors were at play, above all the devastation to the University and the town that would be caused by the risk, however small, that someone would become affected.”

Buckingham is a private university with about 3,000 students and operates on a calendar year, so the graduation would have been attended by those who finished studies in December in four of its five academic units.

The University of London announced that it will postpone a graduation ceremony for students in distance and flexible learning programmes that was scheduled to take place in London today.

3/3/2020, 4:59:22 PM

WHO urges governments to help boost supplies of medical gear

Clive Cookson in London

The World Health Organisation has made a new plea for governments and companies to increase supplies of personal protective equipment and suppress soaring prices.

“We are concerned that countries’ abilities to respond are being compromised by the severe and increasing disruption to the global supply of PPE, caused by rising demand, hoarding and misuse,” Dr Tedros Adhanom Ghebreyesus, WHO director-general, told the organisation’s daily teleconference in Geneva.

“Shortages are leaving doctors, nurses and other frontline health workers dangerously ill-equipped to care for Covid-19 patients, due to limited access to supplies such as gloves, medical masks, respirators, goggles, face shields, gowns and aprons. Prices of surgical masks have increased six-fold, N95 respirators have more than trebled and gowns cost twice as much.”

He estimated that personal protective equipment supplies need to be increased by 40 per cent.

“We have called on governments to develop incentives for manufacturers to ramp up production. This includes easing restrictions on the export and distribution of personal protective equipment & other medical supplies.”

3/3/2020, 4:56:44 PM

Fed ‘getting ahead’ of virus fallout, US Treasury boss says

James Politi in Washington

In a hearing before the House of Representatives on Tuesday, US Treasury secretary Steven Mnuchin said he “very much” supported the Fed’s move.

“I think they did the right thing getting ahead of this,” Mr Mnuchin said. “All the central banks and finance ministers are very focused on what we can do together and independently on what we can do to weather the economic impact of this. This is going to impact a lot of people in the short term.”

Speaking to members of Congress, Mr Mnuchin said the US Treasury was looking at some temporary tax measures to stimulate the economy in response to the outbreak. Mr Trump had earlier called for a cut in payroll taxes on Twitter. But Richard Neal, the Democratic chairman of the House ways and means committee, said any stimulus should be focused on infrastructure spending, rather than tax cuts, foreshadowing a fight between the administration and lawmakers on the details of any package. Mr Mnuchin said the Trump administration was not considering cutting US tariffs on Chinese imports.

3/3/2020, 4:51:08 PM

India cancels major naval exercise, widens travel restrictions

By Amy Kazmin

The global coronavirus outbreak has claimed another casualty, as the Indian navy on Tuesday postponed its huge MILAN 2020 naval exercise, in which 20 friendly foreign navies were due to participate later this month.

The giant bi-annual naval exercise — whose participants include friendly navies from Southeast and East Asia, Europe and Africa — was due to take place in the southern Indian port of Visakhapatnam, and off its coast, from March 18 until March 28.

The Press Trust of India reported that the event was postponed as a “precautionary measure” in light of the coronavirus outbreak, and India’s own increasingly strict travel restrictions.

India, which has had relatively few coronavirus cases so far, has stepped up its restrictions on visitors from some highly affected countries, as it seeks to prevent the import and spread of the virus domestically.

Hours before it cancelled the military exercise, New Delhi announced that it was cancelling all extant Indian visas for citizens of Italy, Iran, Japan and South Korea, if the visa-holders had not already arrived in the country.

It said those with “compelling reasons” to travel to India could re-apply for fresh visas at Indian embassies in their countries..

Last month, India had cancelled extant visas for travellers from China, drawing ire from Beijing.

This week, Indian health officials confirmed three new cases of coronavirus — their first since early February — all in patients with recent histories of overseas travel.

The cases include one each in the cities of Delhi (in a patient returned from Italy); Hyderabad (in a patient returned from Dubai); and Jaipur, where an Italian tourist has been confirmed as carrying the infection.

The latest cases are the first in India since early February, when three Indian medical students studying in Wuhan were confirmed as infected on their arrival at home in Kerala over the Chinese new year holidays.

On Tuesday, the Press Trust of India also reported that Indian health officials have sent a group of 21 Italian tourists, and three Indian tourist operators, to a quarantine facility due to their suspected exposure to the virus.

3/3/2020, 4:31:59 PM

US warns vaccine will not be ready quickly

Kiran Stacey in Washington reports:

A senior US official has warned that it will be at least a year until a coronavirus vaccine can be widely deployed.

Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, told a Senate committee hearing:

One [vaccine candidate] will likely go into clinical trials in a Phase One study within about two months, or maybe even six weeks. That would be a record – however, that is not a vaccine, because it will take about three months or more to show that it is safe. And then if you show that it’s safe, you’ve got to put it into what’s called a Phase Two trial to show that it works.

To make sure it works that entire process will take at least a year and a year and a half. So when we hear talk about a vaccine is going to be ready in a couple of months, it won’t be ready for being deployed. It’s going to take a while.”

3/3/2020, 3:54:12 PM

Amazon fights coronavirus price-gouging

Amazon is struggling to contain rampant price-gouging by sellers capitalising on the fear surrounding the spread of the coronavirus, Dave Lee in San Francisco writes.

Hand sanitiser and respiratory masks were in some cases being sold on the site on Monday at a more than 2,000 per cent mark-up, compared to normal retail prices, despite Amazon saying it had removed “tens of thousands” of listings and was monitoring postings closely.

Read more here.

3/3/2020, 3:49:25 PM

Trump wants more from the Fed

https://twitter.com/realDonaldTrump/status/1234867032837021698?s=20

3/3/2020, 3:41:22 PM

Dollar slips following Fed rate cut

Here is the latest market reaction following the Fed’s unscheduled 50 basis point rate cut:

• US stocks shot higher only to give up those gains in volatile trading. Just over half an hour after the announcement, the S&P 500 was 0.2 per cent higher on the day, with the Stoxx Europe 600 up 2 per cent.

• The dollar fell in the moments after the news, and was recently 0.4 per cent lower against a basket of global currencies.

• The yield on the 10-year US treasury was heading back towards the record lows hit earlier this week, and was recently at 1.09 per cent. The yield on the benchmark US government bond dropped to a low of 1.03 per cent on Monday.

Sebastien Galy, a strategist at Nordea Asset Management, said the relatively limited impact on US stock markets showed “how far aggressive pricing of rate cuts had gone.”

“We would expect another rate cut at the next meeting,” he added.

3/3/2020, 3:36:22 PM

France records 4th virus death as cases surpass 200

David Keohane and Leila Abboud report from Paris

A 92 year old man has died in France of the coronavirus, bringing the total number of deaths in the country to four, confirmed the French health ministry on Tuesday.

France now has 204 confirmed cases of the virus, making it one of the hardest countries in Europe alongside Italy and Germany. In response the government has banned all indoor gatherings of more than 5000 people and some outdoor meetings with a high risk of the infection being spread have also been pulled, such as the Paris half-marathon last weekend.

The Louvre, the world’s busiest museum, remained closed on Tuesday, having shut its doors over the weekend. However, that is not because of a government decision, rather it is due to museum workers exercising their right as public sector employees to not work if they fear for their health or safety. Some bus drivers have also exercised the same right.

On Tuesday, French president Emmanuel Macron said the government was requisitioning “all stocks and the production of protective masks” to be distributed “to healthcare professionals and French people affected by the Coronavirus.”

French finance minister Bruno Le Maire also weighed in, saying he was investigating whether shops were unfairly hiking prices on sales of gels and masks — which have sold out in many shops — and said he was ready to regulate prices “by decree… if the abuses were widespread.

3/3/2020, 3:29:06 PM

Opec scales back delegates for next meeting

Opec has asked countries attending its next meeting in Vienna this week to keep delegate numbers to a bare minimum as fears mount about the spread of Coronavirus, Anjli Raval writes.

The Saudi Arabia-led oil producers’ bloc has asked members to send only ministers and one or two advisers for each lead official, one person familiar with the matter said.

Each country usually brings a string of delegates to attend the twice-yearly meetings with officials constantly moving in and out of the building and shuttling to and from Vienna’s five star hotels as bilateral discussions take place.

And in an unprecedented move journalists – who usually attend Opec meetings from around the world, packing themselves into a cramped basement, along stairwells and behind security barriers – will not be permitted into the secretariat building this time.

Opec and allies including Russia are meeting to decide on oil supply levels as demand growth takes a hit from the coronavirus.

Saudi Arabia has asked producers including Russia to sign up to a collective production cut of an additional 1m barrels a day, the FT revealed last week.

3/3/2020, 3:23:42 PM

Bank of England in no hurry to follow the Fed

Chris Giles, the FT’s economics editor, writes:

The Bank of England was clear that it was in no immediate hurry to follow the Federal Reserve and cut interest rates to address the economic fallout of coronavirus before its next scheduled meeting, but it did not rule out such a move.

Giving evidence to the Treasury Committee on Tuesday morning, governor Mark Carney said communications lines were open between central banks but stressed that “across jurisdictions there’ll be some differences in the exact form and timing of those measures”.

Policy makers see next week’s Budget as the time to act to offset the economic damage from the spreading of the disease, with the UK government already hinting at action to tide companies over and ensure a temporary downturn did not become permanent.

3/3/2020, 3:18:49 PM

Markets volatile following Fed cut

US stock markets have turned lower in volatile trading as investors react to the Fed’s decision to cut interest rates by 50 basis points in response to the coronavius outbreak.

Markets have recovered some of last week’s steep losses on the prospect of co-ordinated policy action from the world’s major economies. Earlier on Tuesday,
central banks in Australia and Malaysia cut their interest rates, the Bank of Japan injected liquidity into the country’s financial system for a second day, and the Bank of England’s governor said the bank stands ready to support the economy.

3/3/2020, 3:01:59 PM

Emoticon Fed cuts interest rates

US stocks have risen sharply after the Federal Reserve voted to cut its main policy rate by 50 basis points on Tuesday, responding to “evolving risks” from the spread of the coronavirus.

The decision breathed new life into a global stock market rebound triggered by hopes of central bank action. The S&P 500 was recently 1 per cent higher, while the Stoxx Europe 600 gained 3 per cent.

3/3/2020, 2:47:32 PM

Emoticon US markets open lower

A rebound in global stock markets stuttered into the Wall Street open after G7 policymakers stopped short of announcing an immediate policy response to the economic impact of the coronavirus outbreak.

Following a conference call on Tuesday, the group of nations issued a statement in which they pledged action to be taken individually by each country, without detailing specific measures.

The S&P 500 traded 0.5 per cent lower in the opening minutes of trading, while the Dow Jones and Nasdaq recorded similar losses. European stocks gave back some of their earlier gains to trade 2 per cent higher.

“The G7 statement falls short of hopes of a coordinated policy response and raises the risk that central banks will disappoint markets’ expectations in the months ahead,” said Jennifer McKeown, an economist at Capital Economics.

Markets have recovered some of last week’s steep losses on the prospect of co-ordinated policy action from the world’s major economies, although some analysts and economists have questioned the limits of monetary policy in responding to a global health crisis.

“If you want to fix your health by going to a bank, you’ve got a problem,” said Davide Serra, founder of London-based investment firm Algebris, which manages around $13bn in assets.

3/3/2020, 2:12:53 PM

Leipzig book fair joins list of cancelled events

Guy Chazan reports from Berlin:

The Leipzig book fair has become the latest major event to have been called off because of coronavirus fears.

The event’s management and Leipzig city decided jointly to cancel the March 12-15 fair, in a blow to the publishing industry. “Safety is the priority,” said Martin-Buhl Wagner, the fair’s managing director.

Some 2,500 exhibitors from 51 countries were expected at the event, which was to be accompanied by some 3,700 readings and other events as part of a programme known as “Leipzig reads”. The “Manga-Comic-Con” comic book fair, which was to run concurrently, was also called off.

“Never in the last seven decades has the Leipzig book fair ever had to make such a difficult decision,” said Oliver Zille, director of the fair. “It’s bitter for us and for the whole publishing industry.”

Last week Berlin authorities cancelled ITB, one of Europe’s most important tourism fairs.

3/3/2020, 1:41:50 PM

Spain records new cases taking total to 150

The number of coronavirus cases in Spain has risen to 150 – up from 114 the previous day, Daniel Dombey in Madrid writes.

Fernando Simón, the doctor coordinating the country’s response, said that the new total included 15 cases awaiting final confirmation.

Madrid is by far the most affected region in the country, with 49 cases. The region around the Spanish capital also represents the lion’s share of the overnight rise.

No-one has died from the virus in Spain.

Dr Simón said Spanish authorities would probably take a decision on Tuesday afternoon about whether to proceed with a Champions League match scheduled for March 10 between Valencia and Atalanta of Bergamo.

3/3/2020, 1:39:28 PM

Stocks seesaw as investors weigh stimulus prospects

A rebound in global stock markets stuttered after G7 policymakers stopped short of announcing an immediate policy response to the economic impact of the coronavirus outbreak, reports Philip Georgiadis and Laurence Fletcher in London and Hudson Lockett in Hong Kong.

It has been a choppy day for markets. On Wall Street, futures tied to the S&P 500 turned negative following the statement but recently regained some ground to rise 0.4 per cent. The Stoxx Europe 600 has trimmed some of its earlier gains and recently the index rose 2.4 per cent, tracking the previous day’s sharp gains on Wall Street.

Markets have recovered some of last week’s steep losses on the prospect of co-ordinated policy action from the world’s major economies.

The group of the seven biggest economies issued a statement on Tuesday in which they pledged action to be taken individually by each country, without detailing specific measures.

3/3/2020, 1:36:04 PM

UK cases rise to 51

The number of people now diagnosed with coronavirus in the UK has risen to 51, health secretary Matt Hancock said.

He told the House of Commons the threat is “increasingly serious” and it is becoming “more likely that we will see widespread transmission here in this country.”
Speaking to MPs, he said:

The situation facing the country is increasingly serious. Globally and at home the number of cases continues to rise.

As of 9am today there were 51 confirmed cases in the UK and it’s becoming more likely that we will see widespread transmission here in this country.

Containment is about detecting the early cases, following up with close contacts, preventing the disease from taking hold in this country for as long as reasonably possible.

This approach also buys time for the NHS to ramp up its preparations. If the number of global cases continues to rise, especially in Europe, the scientific advice is that we may not be able to contain this virus indefinitely.

3/3/2020, 12:49:19 PM


Airline chiefs play down virus hit to demand

Javier Espinoza reports from Brussels

Airline bosses dismissed concerns the coronavirus outbreak would cause significant and long-term damage to demand, insisting that experience of events such as the September 2001 terrorist attacks and Sars outbreak gives the industry resilience.

The chief executives of groups including Ryanair, easyJet, Air France-KLM, International Airlines Group and Lufthansa put on a brave face at a trade conference in Brussels on Tuesday.

“The immediate short-term panic about travelling will erode very rapidly,” said Michael O’Leary, chief executive of Irish low-cost airline Ryanair.

However, disruption will affect airlines initially: Ryanair for example has cancelled 25 per cent of flights until the first week of April.

Business travel demand has taken a hit, said Willie Walsh, chief executive of British Airways owner IAG. “We have seen a fall in demand from the business sense – premium and non-premium – as a result of companies introducing more restrictive travel policies and cancellation of large events.”

Executives insisted the industry was resilient. Mr Walsh said he anticipated demand would stabilise within “a couple of weeks”.

3/3/2020, 12:41:32 PM

Emoticon
G7 members vow to use ‘all appropriate policy tools’ to support economy

Chris Giles, economics editor, reports:

Finance ministers and central bank governors from the leading western nations pledged on Tuesday to use “all appropriate policy tools” to maintain economic health as the spread of coronavirus continues.

Following a conference call, the G7 issued a statement pledging action to be taken individually by each nation without detailing the specific measures that would be adopted.

“Given the potential impacts of Covid-19 on global growth, we reaffirm our commitment to use all appropriate policy tools to achieve strong, sustainable growth and safeguard against downside risks,” it said.

The finance ministers pledged fiscal support to ensure health systems could respond to the disease and to tide economies over during what policy makers now believe is likely to be a serious slowdown for at least a few months.

The OECD yesterday warned that a prolonged outbreak of coronavirus could halve the forecast global growth rate from almost 3 per cent to 1.5 per cent.

Central bankers gave a strong indication they were preparing to cut interest rates and pump more liquidity into their economies, pledging to “continue to fulfill their mandates, thus supporting price stability and economic growth while maintaining the resilience of the financial system”.

The G7 members also gave their support, as shareholders, to the IMF and World Bank’s decision on Monday to open credit lines and emergency facilities to lend to countries facing a cash crunch when dealing with the virus.

“G7 Finance Ministers and Central Bank Governors stand ready to cooperate further on timely and effective measures,” the statement said.

3/3/2020, 12:36:09 PM

British Medical Association concerned by plans to call in retired doctors

Josephine Cumbo in London reports:

The British Medical Association has raised concerns about government plans to enlist the help of retired doctors to plug pressures in the health service caused by the impact of the coronavirus.

Matt Hancock, the health secretary, on Sunday suggested that recently retired doctors and nurses could be called back to fill in for sick or absent colleagues.

But on Tuesday, the BMA expressed concerns that older doctors could be put at risk if they were assigned to help with coronavirus cases.

“We have to be slightly careful because people who are at most risk (of catching coronavirus) are older members of the public,” said Vishal Sharma, chair of the BMA pensions committee and deputy chair of the BMA consultants committee.

Dr Sharma added:

If this proposal is being looked at by the government we’d certainly want to talk to them about it, but it might be that we try and look at using retired doctors in different ways to help free people up.

3/3/2020, 12:32:19 PM

Art Dubai becomes latest Gulf event to be postponed

Simeon Kerr reports from Dubai:

Art Dubai, the emirate’s international art fair, has been postponed as Gulf states ramp up measures to stem the spread of coronavirus.

The fair, scheduled for March 25-28, will instead stage a local programme featuring regional galleries, while welcoming international visitors. Dates of the rescheduled fair are to be confirmed.

Art Dubai, which had planned to host dozens of galleries from across the world, is the latest high profile event to be postponed as Gulf states seek to ward off further outbreaks.

The six Arab Gulf states have reported 140 cases, largely fuelled by nationals returning from neighbouring Iran, which has recorded 77 deaths and more than 2,300 cases.

A dance music festival in Abu Dhabi’s 25,000-capacity Du arena has been postponed along with a Korean pop music concert in Dubai this month. US rapper Russ’ Dubai show has been rescheduled for November.

Dubai’s boat show has been pushed back until November and a carnival to celebrate the Hindu holi festival this weekend has been called off. Qatar has cancelled a maritime defence industry trade show.

Abu Dhabi has cancelled an upcoming international triathlon event in the wake of an early end to a major professional cycling race last week, which left dozens of professional athletes quarantined in their hotels in the capital after two Italians working on the UAE tour tested positive for coronavirus. Bahrain’s Formula 1 grand prix on March 22 is scheduled to go ahead, however.

Conferences, concerts and sporting events are a major part of the Gulf states’ attempts to attract tourism as they seek to reduce oil dependency.

3/3/2020, 11:59:30 AM

Markets hang on to most of Tuesday’s strong gains

Global stock markets are off their session highs, but have still recorded strong gains as investors bank on government and central bank action to soften the economic impact of the outbreak.

• The Stoxx Europe 600 rose 2.2 per cent in morning trading, with major gains across the region’s bourses.

• The S&P 500 was set to rise another 0.5 per cent when Wall Street opens, after it surged by 4.6 per cent on Monday in its biggest one-day gain in 14 months.

• A dramatic flight into government bonds also partially unwound on Tuesday. The yield on 10-year US Treasuries rose 0.05 percentage points to 1.1370 per cent as investors moved out of the debt.

• Oil prices climbed, with Brent crude, the international benchmark, rising 2.3 per cent to $53 a barrel.

3/3/2020, 11:59:25 AM

Virus forces Tesla to deliver cars with older parts in China

Tesla said the coronavirus has forced it to deliver cars with older parts, as the outbreak adds pressure to Elon Musk and his ambitious expansion plans in China, writes Christian Shepherd in Beijing.

Chinese buyers of Tesla’s mass-market Model 3 sedans manufactured in its Shanghai factory have complained recently that their cars arrived without the latest version of the model’s self-driving technology.

Tesla responded on Tuesday saying the outbreak has caused delays in the supply of parts, requiring the company to ship vehicles with an older version of the hardware that would later be upgraded for free, Chinese state media said.

Tesla founder Mr Musk has made headway in localising production in China, building the Shanghai factory in record time. The carmaker restarted production on February 10.

3/3/2020, 11:52:18 AM

US prepares to test up to 1m people for virus this week

The US is embarking on a programme of mass testing for Covid-19, with authorities claiming it is possible that close to 1m people will be screened by the end of this week.

The claim, by FDA commissioner Stephen Hahn at a White House briefing Monday evening, comes after six US citizens died after contracting the coronavirus.

Meanwhile Anthony Fauci, head of the infectious diseases unit at the US National Institutes of Health, has predicted a jump in the number of US cases of Covid-19, which have so far exceeded 100.

“When you have a number of cases that you’ve identified and they’ve been in the community for a while, you’re going to wind up seeing a lot more cases than you would have predicted,” Mr Fauci told CNN.

3/3/2020, 11:47:26 AM

Good morning Americas

While you were gone:

• European stocks rallied and US futures point to a 0.6 per cent gain

• President Donald Trump called on the Federal Reserve to cut interest rates

• Australia and Malaysia took action on borrowing costs

• Investors focus on G7 finance ministers and central bankers meeting scheduled for noon London time

• Boris Johnson outlined UK plans to combat infection

• Pope Francis tested negative

3/3/2020, 11:15:50 AM

Iran denies cover-up over figures

The death toll in Iran has risen while the number of people who have tested positive for coronavirus has surpassed 2,300, Najmeh Bozorgmehr in Tehran reports.

Ayatollah Ali Khamenei, who showed up with disposable gloves after planting a tree in solitude, ruled out any cover-up with figures. Officials have informed people “honestly and transparently”, the supreme leader said, unlike “some other countries which are in a more severe situation but are hiding realities”.

The health ministry said on Tuesday that 77 people have died and cases have increased to 2,336 from 1,501.

The Islamic republic suspects some neighbouring and regional states that have reported lower casualties than Iran lack medical capabilities to detect the virus, while others conceal fatalities on fears of economic consequences.

Iran plans to start a national mobilisation programme on Wednesday with 300,000 medical teams joined by voluntary forces of the Revolutionary Guards taking care of each family’s situation.

Saeed Namaki, Iran’s health minister, allayed concerns on Tuesday that these teams could show up at people’s doors — as he had earlier suggested — and could further transmit the virus. Mr Namaki said this would be done in “99.5 per cent” of the cases remotely and, if any visit was necessary, it would be done with maximum hygienic considerations. He said pharmacies, which have run out of stock, will be supplied with face masks and sanitisers this week.

The police reported a crackdown on Tuesday by which millions of masks were discovered from warehouses whose owners allegedly hoarded them to reap benefits in the black market.

Iran has introduced a deadline for banking loans and tax and insurance payments and has offered almost free-of-charge treatment of coronavirus patients in state-run hospitals.

3/3/2020, 10:58:10 AM

Emoticon Johnson outlines UK response

Sebastian Payne in Westminster reports:

Boris Johnson urged UK citizens to “go about their business as usual”, even though there are likely to be a “growing number of UK cases”, as he unveiled a plan to tackle the outbreak.

“It is highly likely we will see a growing number of UK cases,” the prime minister said at a news conference from Downing Street, adding that “for the vast majority of people in this country, they should go about their business as usual”.

“For the overwhelming majority of people who contract the virus, it is a mild disease that they will speedily recover” from, he said.

The Covid-19 outbreak could lead to one in five off work.

The UK’s plan focuses on containing the virus, delaying its spread, researching its origins and then mitigating the impact, he said. It coordinates the UK’s four nations and includes powers for the police and fire services to concentrate on core services.

The plan does not set out what the government will do, but the steps the government will take on the basis of scientific advice.

“Around 1 per cent of people who get this virus might end up dying, based on the Chinese experience,” said Chris Whitty, the UK’s chief medical officer.

He added that he does not believe more than 80 per cent of the population will be infected with the virus, suggesting it will likely be much lower.

3/3/2020, 10:49:18 AM

Singapore to bar recent visitors to Iran, northern Italy and South Korea

Singapore will bar entry to visitors with a recent travel history to Iran, northern Italy and South Korea from midnight on March 4, reports Mercedes Ruehl in Singapore.

The city’s government, which has reported 108 coronavirus cases, said travellers who have visited these places within the past 14 days would be unable to transit through Singapore.

Permanent residents and long-term pass holders returning from Iran, northern Italy and South Korea must quarantine themselves at home for 14 days, the government said. Singapore is the third most affected country in Asia.

3/3/2020, 10:26:22 AM

Carney signals BoE ready to act

Delphine Strauss reports:

Mark Carney has signalled that the Bank of England would be ready to join a global effort by central banks to soften the impact of the coronavirus outbreak.

In a statement to the parliamentary Treasury committee on Tuesday, the outgoing BoE governor said the central banks’ role would be “to help UK businesses and households manage through an economic shock that could prove large but will ultimately be temporary”.

He told the committee:

We have to work out how to bridge this period. We don’t want viable firms to go out of business because of the necessary steps that have to be taken to protect the British public.

For the monetary policy committee, this would mean considering “the extent to which supply disruptions have aggregate demand consequences, via cash flow, cost and availability of finance, as well as confidence effects”.

In a clear hint that the BoE would be ready to cut interest rates, Mr Carney said it was “reasonably plausible that the demand effect would be greater than the supply effect in the near term”.

Mr Carney said the BoE was also looking at ways to ensure that banks could use their balance sheets as effectively as possible to lend to businesses in need of working capital to stay afloat; and could also look at facilities to support lending to small businesses.

The BoE’s prudential regulators were reviewing financial institutions’ contingency plans, including their ability to continue operating with split teams and home working.

The economic shock of the coronavirus outbreak could be large, Mr Carney said, but in contrast with the 2008 financial crisis – which had lasting scarring effects on the economy – “the prospect with this situation is that we will have disruption not destruction, and that should be and will be the focus of policy.”

3/3/2020, 10:00:56 AM

Pope Francis tests negative for coronavirus

Davide Ghiglione reports from Rome:

Pope Francis, who has been suffering from a cold for the last few days, has tested negative for coronavirus, according to Roman newspaper Il Messaggero.

The pontiff cancelled most audiences last week due to what the Vatican called a “slight indisposition”, and called off his participation at a week-long spiritual retreat in the Roman countryside because of a cold.

Francis was set to take part in spiritual exercises that he initiated early in his pontificate to mark the start of each Lenten season. It is the first time in his papacy that he has missed them.

“Unfortunately a cold prevents me from participating this year. I will be following the meditation from here,” Francis said last Sunday, addressing pilgrims gathered in St. Peter’s Square.

The Vatican had no immediate comment on the newspaper article.

3/3/2020, 9:57:22 AM

Ukraine reports first virus case

Roman Olearchyk reports from Kiev:

Ukraine on Tuesday reported its first confirmed case of the novel coronavirus, as the disease continued to spread throughout Europe.

Viktor Lyashko, the country’s chief sanitary doctor, said the affected patient was quarantined in Chernivtsi, a town close to the Romanian border. Other health ministry officials were quoted by media saying he had returned recently from a trip to Italy via Romania.

Mr Lyashko in making the announcement said there “is no need to panic.”

The country handling of coronavirus fears has been shaky in past weeks.

Late last month as Ukraine’s government evacuated dozens of Ukrainians from China and transported them in buses to Novi Sanzhary, a small town east of Kyiv. Dozens of local residents who opposed to their town being used as a quarantine location hurled rocks at the arriving buses smashing some windows.

To calm fears the country’s health minister, Zoryana Skaletska arrived on the scene and quarantined herself along with the Ukrainians flown in from China. She has worked remotely from the location while doing daily interviews via Skype from her room at the resort where she and individuals flown in from China are vbeing held for two weeks.

In a Facebook post today, Ms Skaletska showed herself wearing a medical mask while playing ping pong at the facility.

3/3/2020, 9:51:33 AM

India restricts exports of some drugs on coronavirus fears

Amy Kazmin, the FT’s south Asia bureau chief, reports:

India announced it was restricting the exports of 26 drugs and vitamins, including paracetamol, progesterone, and a wide range of antibiotics, amid growing concerns about the disruptions to drug supplies from the coronavirus outbreak.

India is a major drug exporter, selling $17bn worth of mostly generic drugs to overseas markets, including the US and Europe. But it depends on China for nearly 70 per cent of the raw materials – or active pharmaceutical ingredients – that it uses for its drug formulations.

Cipla, one of India’s biggest drug makers, had warned last month that Indian pharmaceutical companies would start to face disruptions if their Chinese suppliers were not able to resume production by early March.

India’s new export restrictions were imposed a day after health officials confirmed two new cases of coronavirus, one in New Delhi – in a patient returned from Italy – and one in Hyderabad, in a patient that had returned from Dubai.

Sudarshan Jain, secretary general of the Indian Pharmaceutical Alliance – which represents India’s domestic drug companies, said companies that now want to export drug consignments will be required to obtain prior government for their shipments, demonstrating genuine demand.

Some pharmaceutical companies have already complained of a sharp rise in raw ingredients for medicines such as paracetamol.

“We are trying to prevent speculation and hoarding,” Mr Jain said. “People should not take advantage of Covid-19.”

India has also cancelled all extant visas for visitors from Japan and South Korea if they have not already entered the country. New Delhi had previously cancelled all extant visas for travelers from China.

3/3/2020, 9:23:56 AM

Markets update: Over to the central bankers

• European stocks higher, with the Stoxx Europe 600 up more than 2.5 per cent

• Futures point to gains of 1 per cent for the S&P 500, following Monday’s surge

• Safety trade slightly unwinds, US 10-year bond yield up 7 basis points to 1.1566

• Trump calls on Fed to cut rates, after Australian and Malaysia take action

• Investors focus on G7 finance ministers and central bankers meeting at noon London time

3/3/2020, 9:15:27 AM

Thermo Fisher to buy virus test kit maker Qiagen in $11.5bn deal

US scientific instruments maker Thermo Fisher is set to buy Dutch diagnostics company Qiagen in a deal that values it at $11.5bn, including debt, as it seeks to expand its disease-testing capabilities.

The planned acquisition comes as the Dutch group develops test kits for the novel coronavirus, which has infected more than 90,000 people globally and killed more than 3,000.

The all-cash deal, which has been agreed by the boards of both companies, would see Thermo Fisher pay €39 a share for Qiagen, valuing it at $11.5bn at current exchange rates, including $1.4bn in debt. The offer represents a 23 per cent premium to Qiagen’s closing share price on Monday.

Thermo Fisher, which has a market capitalisation of around $122bn and offers diagnostic tools for the medical and scientific community, said the deal would allow it to expand its speciality diagnostics portfolio, notably in infectious disease testing.

Qiagen provided equipment during the Sars and swine flu outbreaks and has been developing test kits for the Covid-19 outbreak. Last week it said it had sent test kits to four hospitals in China for evaluation.

3/3/2020, 8:51:01 AM

UK’s quarantined workers to receive basic sick pay, says health minister

The FT’s chief political correspondent Jim Pickard reports:

Workers who have isolated themselves because of the risk of coronavirus will only be paid basic statutory sick pay, the British government said as fears about the economic impact of the epidemic increase .

“We’ve got a statutory sick pay system in this country and self-isolating for medical reasons if you’re healthy counts as being sick in the legislation,” he said. “The rules are clear,” Matt Hancock, the health secretary, said on BBC Radio 4’s Today programme.

UK workers can receive £94.25 a week statutory sick pay if they are too ill to work, paid by their employers for up to 28 weeks.

The GMB trade union, whose members include workers in retail, schools and the National Health Service, says this is insufficient to encourage workers to stay at home if they think they may have come into contact with the disease.

Concerns are mounting about the impact on companies and the economy of mass staff sickness or self-quarantine measures. Those on flexible or zero-hours contracts are particularly concerned about the implications of having to stay at home.

Mr Hancock, speaking ahead of a medical planning announcement by prime minister Boris Johnson, said the government was in the “containment” phase of its preparations – trying to stop the spread of the virus. The number of cases in the UK rose to 39 on Monday.

Some of the measures in the package, which will be published at about 10.30am, would be enacted in the most severe circumstances, the minister said. For now, however, the government is urging people to “carry out your normal business”. Schools have been advised not to close unless they have a positive case of coronavirus, Mr Hancock said.

Tuesday’s measures will include proposals for emergency legislation to allow workers who have been registered in certain professions, such as doctors and nurses, to come back if necessary.

3/3/2020, 8:35:36 AM

Foxconn expects China-based output to return to normal soon

Apple supplier Foxconn said on Tuesday that it expected its China-based production capacity to return to normal seasonal levels by the end of this month, writes Kathrin Hille in Taipei.

More than 50 per cent of the staff normally working at this time of year have returned to work, chairman Liu Young-way said on a call with analysts.

The update comes as the world’s largest electronics contract manufacturer seeks to reassure investors over the impact of the large-scale disruption the coronavirus epidemic has brought to the global technology supply chain.

The company said it could not yet estimate how the outbreak would influence its full-year financial performance, although it had warned last month that there would be a negative impact.

But it predicted a double-digit percentage drop in revenue for the first quarter. Revenues from manufacturing consumer electronics products, enterprise products and computing products would slide by more than 15 per cent compared with the previous quarter and compared with the same period last year, Foxconn said. It gave a slightly less bearish outlook for revenue from component production and other business, which is forecast to drop by more than 10 per cent.

The company sounded a cautiously optimistic note, indicating that it expects the production disruption to delay rather than entirely derail operations. Judging from the current state of work resumption, the second quarter could similar to a normal first quarter, Mr Liu said.

3/3/2020, 8:32:47 AM

Emoticon European stocks rise on stimulus hopes

European stock markets rallied in the first half hour of trading, as investors bet that the world’s major central banks will take action to soften the economic blow from the coronavirus outbreak.

The Stoxx Europe 600 rose 2.5 per cent, while London’s FTSE 100 was up 2 per cent.

The gains were more modest than a rush of optimism on Wall Street, when the S&P 500 surged by 4.6 per cent on Monday in New York in its biggest one-day gain in 14 months.

Markets have recovered some of last week’s steep losses on the prospect of co-ordinated policy action when finance ministers and central bankers of the G7 nations meet later in the day. But some optimism over policy support has dimmed following a report that a draft statement attributed to officials from G7 countries did not specifically call for new fiscal or monetary easing from member nations to counter the virus.

3/3/2020, 8:26:25 AM

SAS withdraws fiscal 2020 guidance as it cuts routes

Stockholm-based Scandinavian Airlines plans to cut part of its short-haul routes over the next two months and from Thursday will suspend flights to Hong Kong in an effort to mitigate the effects from the spread of coronavirus.

The Scandinavian group said it will withdraw its fiscal 2020 guidance. On December 5, before the news of the infection broke, the airline had said it expects to deliver an ebit, or earnings before interest and taxes, margin before items affecting comparability of 3 per cent to 5 per cent for the fiscal year 2020.

SAS said the reduced capacity will lower costs related to flights, such as jet fuel and airport fees, as it struggles to stave off the problems of lower demand due to the outbreak that has spread worldwide from China. The airline has suspended journeys to and from mainland China.

The airline will seek to cut administration and staff costs, such as laying employees off temporarily or offering voluntary leave, freeze hiring and will postpone non-critical projects and marketing campaigns.

“At this stage, it is too early to assess the full impact on SAS operations and financial outcome and therefore not possible to give a more accurate guidance,” the group said in a statement on Tuesday.

3/3/2020, 8:07:05 AM

Malaysia cuts key rate to cushion virus blow

Malaysia has cut its key policy rate to a decade low in a bid to mitigate some of the effects of the coronavirus outbreak.

Bank Negara Malaysia, the country’s central bank, announced a 25-basis point cut to 2.5 per cent on Tuesday, pointing to the disruptive impact of the spread of Covid-19.

“Global economic conditions have weakened in the recent period,” the bank said. “The ongoing Covid-19 outbreak has disrupted production and travel activity, especially within the region. This has also led to greater risk aversion, resulting in tighter financial conditions and a resurgence in financial market volatility.”

It expects growth in the first quarter – particularly in tourism and manufacturing – to be knocked by the outbreak.

Earlier today, Australia’s central bank cut interest rates to a new record low of 0.5 per cent in response to the outbreak, which it said was having a “significant effect” on the domestic economy.

3/3/2020, 7:56:03 AM

Trump pushes Fed to cut rates

President Trump has called on the Federal Reserve to cut interest rates in response to the outbreak of the coronavirus, returning to a regular theme of his presidency that has been given fresh impetus by the recent stock market sell-off.

“Should ease and cut rate big,” the president said in a tweet, referencing the Australian Central Bank’s decision to cut rates to a record low in response to the coronavirus.

Mr Trump tweeted:

Australia’s Central Bank cut interest rates and stated it will most likely further ease in order to make up for China’s Coronavirus situation and slowdown. They reduced to 0.5%, a record low. Other countries are doing the same thing, if not more so.

3/3/2020, 7:53:36 AM

Emirates offers staff unpaid leave as virus crimps flight demand

Simeon Kerr reports from Dubai:

Dubai’s Emirates Airline has offered staff voluntary unpaid leave as it cuts flights to destinations affected by the coronavirus outbreak and sees slower demand in some markets.

Adel Al Redha, chief operating officer, said the government-owned carrier wants “to protect our workforce and limit the impact to their roles during a global crisis through tough economic conditions”. Staff can take annual leave or apply for up to one month’s unpaid leave at a time.

Emirates, which activated its crisis management centre in January, has been amending capacity to meet demand across different regions.

“While we have seen some slowdown in certain markets there has been high demand in other areas,” Mr Al Redha said.

Emirates has cut flights to China, except for Beijing, and reduced capacity to Hong Kong, South Korea and Singapore. All flights to Iran’s capital Tehran have been suspended.

Emirates Group, which also includes ground handling and other airport services, employs more than 105,000 people.

3/3/2020, 7:50:16 AM

European stocks set to rise at the open but sentiment still fragile

Stock markets across Europe were set to rise at the opening bell, as investors look to central banks to ease the worst economic impact of the outbreak of coronavirus.

Still, the gains were not expected to match Wall Street’s burst higher late in the previous session. Futures trade pointed to rises of around 1 per cent for the Stoxx Europe 600 index and London’s FTSE 100, while US stock futures have turned negative.

Traders have been cheered by the prospect of coordinated policy action to soften the economic blow from the outbreak, and are pinning hopes on the outcome of a meeting of finance ministers and central bankers which is expected to begin at 12pm London time.

But several economists and analysts have questioned whether investors could be disappointed.

“The market bred on the concept that pumping liquidity helps stocks will be partially disappointed,” said Sebastien Galy, a senior macro strategist at Nordea Asset Management. “The euphoria in the market is unlikely to last and we still expect two weeks of very elevated volatility as the reality sinks in.”

The G7 will likely announce some points of global agreement and a promise for some coordinated action. It is unlikely to announce far more in terms of monetary policy as all are faced with different effects stemming from the Covid 19 virus.

3/3/2020, 7:41:55 AM

Italy cases rise to 1,835

Davide Ghiglione reports from Rome:

As per data released by the Italian Civil Protection last night, 1,835 people have now become ill with the virus in Italy, up by 258 compared to Sunday.

The number does not include the 149 who recovered, 66 more compared to Sunday.
52 people have died so far.

Italy is the country with the third most reported coronavirus infections globally — after China and South Korea and ahead of Iran — following last week’s surge.

3/3/2020, 7:30:12 AM

CMC Markets boosted by recent surge in volatility

The burst of market volatility sparked by the outbreak of coronavirus has sent trading on stock and futures exchanges soaring. Data from bourses showed that flows jumped sharply last week, when the US benchmark S&P 500 stock index tumbled more than 10 per cent from a recent peak to record its fastest correction since the 1930s.

The sharp moves are good news for companies such as CMC Markets, a spreadbetter which offers online trading to retail clients. Ahead of the European market open, CMC said it expects to report operating income ahead of market consensus thanks to the recent volatility and a strong performance at the end of last year.

The recent market conditions experienced have seen heightened trading activity amongst CMC’s clients over and above the strong performance delivered to date.

3/3/2020, 7:22:34 AM

Tui weighs hiring freezes and budget cuts as virus hits bookings

Alice Hancock, leisure industries correspondent, reports:

Tui, Europe’s largest tour operator, has warned that it is looking at hiring freezes and budget reductions across the business as it deals with the financial fallout from the spread of coronavirus to popular holiday destinations such as Tenerife.

The Hanover-based holiday company said in a statement that it had seen weaker bookings in the past week “in line with the industry” and that it had to reroute a cruise ship deployed in Asia to other regions.

On Monday, the first UK citizens were flown home from a hotel in Tenerife where they had been kept in quarantine after Italian guests staying there tested positive for coronavirus. The tourists had been intending to fly home last Monday but had been delayed by a sandstorm before the quarantine was implemented.

The hotel was among a number that both Tui and the online package holiday operator Jet2 book on the island.

Tui said:

Given that the situation is still evolving, it is not yet possible to estimate the potential financial impact across our business of the current Covid-19 development. We are continuously monitoring the situation very closely and actively evaluating the implications for our business.”

Airlines such as KLM and Lufthansa have also implemented measures such as hiring freezes in order to cope with the unknown financial implications of the outbreak.

On Friday, S&P Global, the ratings agency, downgraded Tui’s credit rating from BB to BB- saying that the grounding of the Boeing 737 Max planes – of which Tui had 72 on order – “might weaken the group’s resilience to withstand any further external shocks”.

Tui’s share price has fallen almost 30 per cent in the past month.

3/3/2020, 6:52:39 AM

Asian stocks retreat as hopes of easing fade

Hudson Lockett reports from Hong Kong

The nascent rebound in stock markets stumbled in Asia as hopes faded that central banks would take action to soften the global economic blow from coronavirus.

Optimism over policy support dimmed following a report that a draft statement attributed to officials from G7 countries did not specifically call for new fiscal or monetary easing from member nations to counter the virus.

Japan’s Topix closed down 1.4 per cent after having earlier traded 1.7 per cent higher. The CSI 300 index of Shanghai- and Shenzhen-listed stocks was just 0.3 per cent higher after having traded up 1.3 per cent in the morning session.

S&P 500 futures fell 0.6 per cent after earlier trading as much as 1 per cent higher.

Read more here.

3/3/2020, 6:31:50 AM

Europe: What you might have missed

Australia’s central bank has cut interest rates to a record low in a response to the coronavirus. The outbreak is having a “significant effect” on the country’s travel and education sectors, the Reserve Bank of Australia’s governor, Philip Lowe said.

Stock markets in China initially extended a rally on expectations that central banks will take steps to ease the effects of the coronavirus outbreak on the global economy, before paring gains in afternoon Asian trading. Read more here.

South Korea has further postponed the start of the new school year as the country reported 600 new coronavirus cases. Read more about the cult at the centre of the outbreak in South Korea.

China reported 31 new coronavirus deaths and 202 new cases of the virus in the mainland to the end of Monday.

3/3/2020, 5:05:20 AM

Chinese stocks rise on hopes of stimulus

Hudson Lockett reports from Hong Kong

Chinese stocks extended their rally on rising expectations central banks will take action to soften the global economic blow from coronavirus, buoyed by Wall Street’s best day in over a year.

The CSI 300 index of Shanghai- and Shenzhen-listed stocks gained 1.3 per cent on Tuesday, building on Monday’s 3.3 per cent advance and leaving the benchmark in touching distance of its most recent peak in January.

The gains in China followed a banner day for US equities. Overnight the S&P 500 surged 4.6 per cent — its biggest one-day gain in 14 months — following reports G7 finance ministers and central bankers were preparing a global, co-ordinated response to the coronavirus outbreak.

Central banks in the world’s biggest economies have already started taking steps to mitigate the impact of the crisis. The Reserve Bank of Australia on Tuesday cut its key policy rate by 0.25 percentage point to a new record low of 0.5 per cent. The S&P ASX/200 was up 1.2 per cent.

3/3/2020, 5:03:58 AM

Coronavirus hits Nintendo Switch sales in China

Sue-Lin Wong reports from Hong Kong

Tencent has said sales of the Nintendo Switch in China have been hit by the fallout from the coronavirus outbreak in the country as the technology conglomerate offered to extend warranties on the devices by six months.

“Some of our work including sales, logistics, distribution, promotion, etc, has been hit to various degrees due to the ongoing coronavirus outbreak,” Tencent said in a statement.

Tencent began selling Switches in China in December as a local partner of Nintendo. The company said it would extend warranties of Switches bought before March 31 by six months.

3/3/2020, 4:54:11 AM

Chinese economy likely contracted in past two months – UBS

UBS expects upcoming data to show a contraction in China’s economy due to the coronavirus shock, pointing to “significant downside” on previous forecasts for growth.

The bank’s report on Tuesday pointed to the prospect of falling retail sales, reduced imports and exports, slower consumer price growth and record lows in factory and non-factory PMIs.

However, it also pointed to signs of the economy gearing up again, with traffic gradually increasing in major cities and coal consumption rising at power plants.

The coronavirus has put immense pressure on China’s economy, limiting the country’s return to work after the lunar new year and triggering stimulus from the government.

The bank had previously forecast 3.8 per cent growth in the first quarter. It now expects further government intervention to combat the virus’ economic impact:

We expect more policy easing to come, including another 100 bps RRR cuts, another 10 bps MLF cuts, possibly a deposit benchmark rate cut (<=25 bps) later after CPI falls notably, more fiscal spending on health care system and infrastructure, and more targeted fiscal support for affected companies and individuals.

The analysts added that they don’t expect the government will “push through a massive credit or property stimulus”.

3/3/2020, 4:12:40 AM

Emoticon

Australia cuts rates to record low in response to outbreak

Jamie Smyth reports from Sydney

Australia’s central bank has cut interest rates by 25 basis points to a new record low of 0.5 per cent in response to the coronavirus outbreak, which is having a “significant effect” on the domestic economy.

The move by the Reserve Bank of Australia followed confirmation on Tuesday that the government is preparing a “targeted and measured” fiscal stimulus package amid growing concerns among policymakers that Australia could face its first recession in almost three decades.

“The coronavirus outbreak overseas is having a significant effect on the Australian economy at present, particularly in the education and travel sectors,” said Philip Lowe, RBA governor in a statement. He added that GDP growth in March was likely to be “noticeably weaker than earlier expected”.

Disruption to supply chains and people movements in China – Australia’s biggest trading partner – is having a big impact on a domestic economy, which was already struggling due to two years of drought, recent bushfires and weak consumer spending.

Scott Morrison, Australia’s prime minister, called on high street banks to pass on the full interest rate cut to consumers to support households as they deal with the economic fall out from the spread of the coronavirus.

3/3/2020, 2:47:26 AM

Hong Kong to evacuate its residents from Wuhan

Nicolle Liu and Alice Woodhouse report from Hong Kong

Carrie Lam, Hong Kong’s leader, has announced plans to evacuate 533 of the city’s residents from Wuhan, the centre of the coronavirus outbreak.

A total of four flights will bring the city’s residents back from Wuhan and neighbouring cities on Wednesday and Thursday. Priority will be given to pupils planning to sit university entrance exams this month, pregnant women and those with an urgent medical need.

The Hong Kong government has been criticised for what has been seen as a delay to evacuate residents from Wuhan.

Ms Lam denied that there had been a delay and said restrictions on people exiting Hubei province had made the process of evacuating residents more challenging.

The group will be quarantined and monitored at facilities in Hong Kong for 14 days. Those with symptoms of coronavirus will not be permitted to take the evacuation flights.

Almost 4,000 Hong Kong residents in Hubei have requested assistance from the government.

Ms Lam noted that the number of cases of coronavirus in the territory has exceeded 100, but that while the spread of the virus was under control, the city “cannot be complacent”

3/3/2020, 2:13:43 AM

South Korea delays start of school term over coronavirus outbreak

Song Jung-a reports from Seoul

South Korea reported an additional 600 coronavirus cases on Tuesday, prompting the government to further postpone the beginning of the new school year by two weeks.

The new cases take the total number of infections to 4,812, with 28 deaths. Tests are under way for 35,555 people, while 85,484 have tested negative.

Education minister Yoo Eun-hye today announced that schools would now reopen on March 23, three weeks later than usual, to protect students from the spread of the virus. Last month, she extended school breaks by one week.

US Vice President Mike Pence said on Monday that South Korean travelers taking direct flights to the US will undergo coronavirus screenings, including multiple temperature checks at all airports in South Korea before departure.

His announcement came after the US State Department raised the travel advisory for South Korea’s hardest-struck city of Daegu to the highest level. The rest of South Korea is under the second-highest travel advisory, which urges Americans to reconsider travel to the country.

More than half of South Korea’s infections have been linked to the Shincheonji church in Daegu, the country’s fourth-largest city with 2.4m residents. Lee Man-hee, the leader of the religious sect who has tested negative for the virus, has publicly apologised for the explosion in infections.

The country’s stock market climbed on Tuesday, with the Kospi Composite index gaining 1.2 per cent to 2,026.12. The South Korean won also pared losses, trading up 0.29 per cent at 1,190.50 against the dollar.

3/3/2020, 1:46:03 AM

Australians told to avoid shaking hands to slow spread of coronavirus

Jamie Smyth reports from Sydney

Australians have been advised to avoid shaking hands when greeting people and to “exercise care and caution” when kissing in a bid to slow the spread of the coronavirus.

Brad Hazzard, New South Wales health minister, told reporters that putting your hands out to shake hands was a very Australian thing to do but under the current circumstances a “pat on the back” would be more appropriate.

“No handshaking, it is not necessary at a time when we have a virus that appears to be reasonably active in its endeavours,” he said.

On Monday Australia reported two people had contracted the virus locally- the first known cases of local transmission in the nation. So far 31 Australians have contracted the virus and there has been one reported fatality.

On Tuesday Christian Porter, Australia’s attorney general, said it is likely authorities would use their power to detain people who refuse to comply with quarantine rules in a bid to stop the virus from spreading.

Later on Tuesday the Reserve Bank of Australia will hold a scheduled monetary policy meeting, which is widely expected to cut rates by 0.25 basis points to a new record low of 0.5 per cent.

3/3/2020, 1:45:13 AM

China reports 31 coronavirus deaths

Health authorities in China reported 31 new deaths from coronavirus to the end of Monday, all of which were from Hubei, the centre of the outbreak. That takes the total fatalities to 2,943.

There were 125 new cases of the virus reported across mainland China, down from 202 a day earlier and taking the total cases to 80,151.

3/3/2020, 1:43:42 AM

Asia stocks gain after Wall Street rallies

Stock markets in Asia climbed on Tuesday after Wall Street rallied on expectations central banks will step in to help shield economies from the impact of the coronavirus outbreak.

Japan’s Topix was up as much as 1.7 per cent in early trading, extending the previous day’s gains, while the Kospi in South Korea rose 1.6 per cent and the S&P/ASX 200 added 2.1 per cent. The Hang Seng index was up 0.7 per cent and China’s CSI 300 gained 1.2 per cent.

Overnight in the US, the S&P 500 closed 4.6 per cent higher, snapping a seven-day losing streak sparked by the rapid spread of coronavirus outside China.

The change in mood came after the Bank of Japan said on Monday it would inject liquidity into markets and hinted at raising asset purchases in comments that followed soothing statements from the US Federal Reserve last week.

News that G7 finance ministers and central bankers would discuss a response to the outbreak also eased concerns.

Robert Carnell, regional head of research for ING in Asia-Pacific, said he was sceptical that rate cuts would help alleviate the macroeconomic consequences of the outbreak.

“The impact for firms is largely a cash flow crisis, not a debt service problem, and rate cuts won’t make much difference if your firm can’t produce due to supply chain problems, or staffing levels, or logistical breakdowns associated with virus disruption, lockdown or quarantines,” he said.

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