Coronavirus latest: Rate of infections in Italy’s worst-hit regions show signs of slowing



Senate fails to advance stimulus bill for second time

Lauren Fedor in Washington

Democrats have for the second day in a row stopped a nearly $2tn economic stimulus package from advancing in the Senate, as lawmakers from both parties continue to disagree over how to prop up a US economy battered by the spread of the coronavirus.

A procedural vote in the Republican-controlled Senate failed in a 49-46 vote on Monday afternoon, 11 votes short of the 60 required for Republicans’ proposed stimulus to move ahead.

Negotiations involving Republican Senate majority leader Mitch McConnell, the Senate’s top Democrat, Chuck Schumer, and Treasury secretary Steven Mnuchin are ongoing, and while Mr McConnell lashed out at Democrats on the Senate floor earlier on Monday, Mr Schumer and Mr Mnuchin have continued to insist a deal is “very close”.

Nancy Pelosi, the Democratic speaker of the House, has also been involved in talks. On Monday afternoon, she set out a separate stimulus proposal, drafted by House Democrats.

Democratic lawmakers in both the House and Senate have argued that Republicans’ proposals are too generous to big businesses, and do not include enough limitations on government aid for large companies.

Government advises all British travellers to return to the UK

Laura Hughes in London

The UK’s Foreign and Commonwealth Office has advised all British travellers to return to the UK immediately, amid concerns air routes could be closed without warning in the next 48 hours.

Dominic Raab, the foreign secretary, said UK travellers should contact their tour operator or airline while commercial flights are still available.

“Around the world, more airlines are suspending flights and more airports are closing, some without any notice,” he said.

“Where commercial routes don’t exist, our staff are working round the clock to give advice and support to UK nationals. If you are on holiday abroad the time to come home is now while you still can.”

“We are strongly urging UK travellers overseas to return home now where and while there are still commercial routes to do so.”

Last week the FCO warned the public against all non-essential travel for the next 30 days as part of ramped-up efforts to curtail the spread of the coronavirus. On Monday, it said it was advising British people to return to the UK “now”.

It comes amid reports that British tourists are struggling to fly back to the UK as travel restrictions are imposed by foreign governments. The FCO insisted it was working “around the clock” to support those struggling to return from abroad.

US citizens rush to beat travel bans

Katrina Manson in Washington

Thousands of Americans are racing to get back to the US or risk being stranded by border closures and flight stoppages implemented to slow the spread of coronavirus.

A senior state department official told reporters on Monday the US was working round the clock to bring back citizens stranded abroad by the sudden cut-off in commercial flights.

The US official said Americans abroad should “determine whether this is a place where you would be willing to hunker down for an indeterminate amount of time”.

The state department is arranging 16 flights to take 1,600 US citizens back in the next five days, by chartering commercial flights, calling on the department of homeland security to put on flights that would otherwise more usually be used for deportations and working with the US military.

US citizens seeking repatriation can register for the Smart Traveler Enrollment Program on 1-888-407-4747 or online at

Vacuum cleaner maker Dyson developing a ventilator to help address shortage

Michael Pooler in London

Dyson is developing a ventilator that it intends to manufacture in the UK, as part of efforts by industry to plug a shortage of the medical devices required to treat coronavirus.

The domestic appliances group revealed it has been working in partnership with The Technology Partnership, a medical technology and development company based in Cambridge.

While the NHS has access to more than 8,000 ventilators, which deliver oxygen to patients with acute respiratory difficulties, a total of 30,000 are needed and Prime Minister Boris Johnson has urged manufacturers to rise to the challenge.

“This is a highly complex project being undertaken in an extremely challenging timeframe. We have deployed expertise in air movement, motors, power systems, manufacturing and supply chain,” Dyson said. “We are conducting a full, regulated medical device development, including testing in the laboratory and in humans, and we are scaling up for volume.”

If the privately owned company’s designs obtain approval from the government and NHS, it would look at producing the devices at an R&D centre located in the hangars of a former Royal Air Force Base in Wiltshire, according to a person with direct knowledge of the plans.

Dyson manufactures its products like vacuum cleaners and hairdryers in Asia.

British parents keep children home from school

Andrew Jack and Miranda Green in London

British parents appear to be heeding the government’s advice not to send their children to school unless the children have special needs or the parents are “key workers”.

Two surveys published on Monday suggested that less than 20 per cent of children were attending schools, but now teachers want better health advice on how to keep pupils and staff safe.

A survey by the Association of School and College Leaders, primarily of secondary schools in England and Wales, suggested fewer than 10 per cent of children were in attendance. A separate study by the National Association of Head Teachers said 94 per cent of schools it surveyed had less than 20 per cent of their usual children attending.

Paul Whiteman, general secretary of the NAHT, said: “What schools desperately need now is clear guidance on how to keep the pupils and staff that continue to attend school safe.”

Some schools are organising deep cleaning of classrooms at night and setting up classes with only 4 or 5 children per room to keep them apart. But a number of councils have instructed schools to take extra children from nearby institutions that will then close — increasing the numbers at one site, which will affect efforts to keep infections down.

Car dealer Lookers closes UK showrooms

Peter Campbell in London

Lookers, one of Britain’s largest car dealers, has closed all of its showrooms across the UK to comply with the government’s requests of “social distancing”.

The company will shutter around 150 sites with immediate effect, while its top management and board directors will take a significant pay cut for at least the next three months to try and conserve cash.

Car dealerships in Italy have closed, with the country under lockdown, but showrooms across the UK have remained open so far, even after every major car plant in Europe shut last week.

Lookers said it will keep its online operations open and “will investigate the options for it to maintain some servicing and repair capacity across the country where possible”, it added. Servicing and repair work is highly lucrative for dealerships.

The company “intends to seek all possible government support in order to help protect our colleagues and the future of the business”, it said.

Lookers added that “all the members of the board and various members of senior management have agreed to temporary amendments to their contractual remuneration”, understood to be a pay cut of between 30 per cent and 50 per cent for three months.

The company, which last month delayed publishing its annual results after claiming to have uncovered fraud within one division, said it is “too early to make any reasonable estimate of the financial impact on the group during 2020 and beyond”.

IMF concedes coronavirus will push world economy into recession

Chris Giles in London

The IMF has belatedly recognised that the coronavirus crisis will plunge the world economy into recession.

In a statement after a call with G20 finance ministers, Kristalina Georgieva, who heads the fund, said the outlook was now “negative”.

She forecast “a recession at least as bad as during the global financial crisis or worse”, followed by a recovery in 2021 so long as countries contain the virus successfully.

“The faster the virus stops, the quicker and stronger the recovery will be,” Ms Georgieva said.

The IMF has been slower to recognise the deep damage to the global economy than most of the private sector, having said the effects would be barely noticeable as recently as a month ago.

Now that it has reversed that position, the fund is most concerned about emerging economies without the resources available to fight the disease and facing huge capital flight to the US dollar.

Noting there has been the “largest capital outflow ever recorded”, she said “we are particularly concerned about low-income countries in debt distress” and pledged to offer financial support to these countries alongside the World Bank.

Ukraine seeks larger IMF bailout

Roman Olearchyk in Kyiv

Ukraine’s president Volodymyr Zelensky said he held productive discussions with International Monetary Fund chief Kristalina Georgieva on multibillion-dollar financing to shore up state coffers and the economy.

Addressing Ukraine’s business community, Yulia Kovaliv, a top aide to Mr Zelensky, said the economy could shrink this year by 5 per cent in an “optimistic scenario”.

“Just to combat coronavirus we estimate additional need for $3.5bn-4bn,” she said, noting that talks with the Fund were about boosting support as a $5.5bn IMF programme preliminarily agreed late last year was no longer sufficient.

Ukraine’s parliament could vote this week on bank sector legislation and agriculture land market reforms which are conditions for the IMF programme.

Jordan extends nationwide curfew indefinitely

Andrew England in London

Jordan has extended a nationwide curfew indefinitely and will use local authorities and water companies to deliver bread across the country.

The government has already implemented the most draconian measures in the Middle East in an effort to contain coronavirus, including deploying the army to prevent travel between the government’s 12 governates.

A 24-hour curfew was imposed on Saturday, days after King Adbullah invoked emergency laws. Amjad Adaileh, state minister for media affairs, said on Monday it would “continue until further notice”.

Pharmacies and supermarkets would be open on Tuesday, he added, but they would not sell directly to citizens.

Mr Adailah said medicines, bread, infant formula and bottled drinking water would be solely delivered by municipalities, water distribution companies and other partners, according to the state news agency.

The minister said the government was considering additional mechanisms to deliver other basic supplies and foodstuffs, which would be announced by the end of the week.

The country of 10m people has confirmed 112 cases of coronavirus but has not recorded any deaths.

Soldiers have for days been manning checkpoints around the main entrances into Amman, the capital, as well as other cities and regions to prevent movement of people. The government last week suspended all international flights to Jordan.

Ukraine shuts down most airports and bans tourist travel

Roman Olearchyk in Kyiv

Ukraine’s government on Monday announced new strict restrictions intended to curb infection rates of the novel coronavirus, including a ban on tourist travel abroad for citizens and shutting down all airports with the exception of the main hub for the capital city Kyiv.

The measures come amid discussions that the country would this week declare a nationwide state of emergency granting martial law powers to enforce a lockdown upon most citizens with the exception of medical staff, employees of pharmacies and grocery stores.

Ukraine closed schools, restaurants, shopping malls and banned mass gatherings earlier this month. Confirmed Covid-19 cases in the country are currently below 100, including several fatalities, but critics have attributed the low numbers to limited testing and a shortage of test kits.

President Volodymyr Zelensky defended the measures in a televised address to the nation, saying, “our steps have the sole purpose of saving the lives and health of Ukrainians”.

Clorox to offer shares on Mexican stock market to meet investor demand

Jude Webber in Mexico City

The Clorox Company, which has seen its shares surge as much as 29 per cent this year on demand for cleaning products amid the coronavirus outbreak, is now offering its shares in Mexico, BMV, the Mexican stock exchange, said.

BMV has a 15-year agreement whereby local investors can buy shares and exchange traded funds of global companies listed in other markets from Mexico.

Clorox’s inclusion reflects demand from a local investor to include it in its portfolio, a stock market spokesman said. As from today, any company or investor can buy the assets.

Clorox shares were trading off their recent highs at $171.5 after touching almost $198 last week. Mexico, which is bracing for the full force of the Covid-19 pandemic, has 316 confirmed cases.

Boeing shuts down production in Seattle

Claire Bushey in Chicago

Boeing is shutting down production at its Seattle-area plants for two weeks as the virus continues to spread in Washington state.

The company will slow manufacturing operations starting today and anticipates shutting down completely on March 25 for 14 days. Although the company has its headquarters in Chicago and has significant operations in South Carolina, the bulk of the aerospace manufacturer’s operations are clustered near Seattle, the prime outbreak zone in the US.

A Boeing employee died on March 22 from Covid-19, and there were 29 employees infected, the majority in Washington, according to a report from the Seattle Times. The company has approximately 150,000 employees.

Employees will be paid for the 10 working days while operations are suspended, the company said. Usually the company pays for five days when it halts manufacturing. Staff will clean the factories further during the shutdown, while executives are “establishing rigorous criteria for return to work”.

Boeing had already stopped production of the 737 Max in January, which was grounded in March 2019 following the second of two fatal crashes. This shutdown extends to other commercial jets, as well as defense and space products.

Turkey to receive 300,000 rapid test kits and drug treatment from China

Laura Pitel in Ankara

Turkey will receive 300,000 rapid coronavirus tests from China in the coming days, the country’s health minister has said.

Fahrettin Koca told a press conference that 50,000 tests had already arrived, adding that the rest were due to come on Thursday.

Mr Koca said Turkey, which has suffered 30 deaths from coronavirus, had also received an unnamed Chinese drug that was being used on patients in intensive care. “We will monitor its effectiveness and share the results,” he said.

He said that Ankara had paid for both the kits and the tests, rebuffing speculation Beijing had provided them for free.

Turkey has had mixed relations with China in recent years. While Ankara has sought to attract Chinese investment, Turkey’s foreign ministry angered Beijing by describing its treatment of Uighur Muslims as a “great shame for humanity” and calling for the closure of mass internment camps.

Mr Koca said he was in touch with the Chinese ambassador to Ankara and was striving to help Turkey meet its needs during the coronavirus crisis. He also said that Chinese experts were in touch with Turkey’s coronavirus taskforce, and were hoping to join future meetings by web link.

‘Light at the end of tunnel’ for Lombardy as new infection rate falls

Miles Johnson in Rome

Lombardy’s senior health officials said there was “light at the end of the tunnel” after signs the rate of infections in Italy’s worst-hit region were starting to slow for the first time since the outbreak began.

On Monday official numbers showed that the total number of dead in the country from Covid-19 has risen above 6,000, but that the overall rate of increase in new infections fell for a third consecutive day.

The total number of diagnosed cases in Italy rose by 4,789 to 63,927, a daily increase of 8.1 per cent. This was a slower rate of new infections than daily increases of over 10 per cent per day seen over the past week.

“Today we can confirm the downward trend,” said Giulio Gallera, senior health official in the northern region of Lombardy.

We can say that this is the first positive day, it’s not the time to sing victory but finally we see a light at the end of the tunnel.

The number of dead in Italy rose by 601 over the past 24 hours, taking the total to 6,077. The number of dead announced on Monday was lower than the 651 people who died on Sunday, and the 793 who died on Saturday in what was Italy’s deadliest day so far.

The total number of patients in intensive care on Monday rose by 195 to 3,204 compared with the day before, while the number who have recovered rose by 408 to 6,077.

World Bank calls for G20 countries to offer debt relief

Delphine Strauss in London

The World Bank is calling on G20 countries to offer debt relief to the poorest countries so they can focus their resources on fighting the coronavirus pandemic.

David Malpass, president of the multilateral lender, said on Monday the crisis would hit hardest the poorest countries that qualify for its concessional lending arm, many of whom were already in a difficult debt situation.

The World Bank was ready to frontload concessional lending of up to $35bn to these countries, but it could not see this money go to repay creditors, he said in a statement issued after a call between G20 finance ministers.

“I’m calling on the G20 leaders to allow the poorest countries to suspend all repayments of official bilateral credit,” he said, adding that in many cases debt writedowns would be needed.

Kristalina Georgieva, managing director of the International Monetary Fund, said in a separate statement that the global economy was set for “a recession at least as bad as during the global financial crisis or worse”, and that the challenges were greatest for emerging markets and low income countries, which had suffered the largest capital outflow ever recorded – some $83bn – since the start of the crisis.

The IMF would “massively step up emergency finance” with nearly 80 countries requesting its help, and was ready to deploy all its $1tn lending capacity, she said.

European aviation faces crippling losses as outbreak spreads

Nikou Asgari in London

Europe’s airports are heading towards a €14bn revenue loss in 2020, the first full-year estimate for the severe hit from coronavirus facing the continent’s airport sector.

In a letter sent to the European Commission on Monday afternoon, ACI Europe, the airport industry trade association, urged the commission to introduce “comprehensive, inclusive and non-discriminatory support to the entire aviation eco-system”.

The rapid spread of coronavirus and the ensuing travel bans have put the sector under huge financial strain. ACI forecasts that Europe’s airports will see 700m fewer passengers in 2020, a decrease in footfall of 28 per cent compared with a “business as usual scenario”. The estimate is assuming that current flight restrictions will be lifted by the end of April followed by a gradual recovery in demand.

The letter, sent jointly by ACI Europe and the trade bodies for airline caterers, ground handlers and travel retailers, called on the EU and national governments to ensure any relief measures do not benefit one section of the industry “at the expense of another”.

WHO investigates possible ‘third symptom’ of virus

Camilla Hodgson in London

The World Health Organization said on Monday it was looking into whether a loss of the senses of taste or smell were common symptoms of coronavirus.

Maria Van Kerkhove, the WHO’s technical lead of Covid-19 response team, said she had seen “quite a few reports” that the loss of the two senses was a possible early sign of the disease.

But on the question of whether those were common symptoms, she said: “We don’t have the answer to that yet. It’s something that we’re looking into.”

More woe for WeWork

Andrew Edgecliffe-Johnson in New York

Standard & Poor’s has cut WeWork’s credit rating from B minus to triple C plus, indicating that the rating agency sees a substantial risk of the office provider not being able to repay bondholders.

The price of WeWork unsecured notes maturing in 2025 has plunged from above 80 cents on the dollar to just 34.5 cents since the end of February as investors’ concerns have grown about its prospects.

In announcing the one-notch downgrade, S&P said business disruption from an expected global recession triggered by the spread of coronavirus had combined with uncertainty over the commitment of Softbank, WeWork’s largest shareholder to place “added pressure on the long-term viability of the company and sustainability of its liquidity position”.

WeWork has kept its buildings open, but social distancing and the rise in the number of people working from home “could weigh heavily on WeWork’s business viability, encouraging a drop in total occupancy levels, an increase in operating costs, and pressure on the company’s ability to fill recently opened locations,” S&P said.

Doubts over SoftBank’s commitment have risen since it told investors that it may not proceed with a planned $3bn tender offer, made as part of a rescue refinancing late last year.

Two WeWork directors attacked SoftBank this weekend for attempting to walk away from the promised investment, describing the Japanese company’s plan to walk away from that part of the deal as “inappropriate and dishonest”.

Britain’s confidence in job market falls to eight-year low

Valentina Romei, economics correspondent, in London:

Job security in the UK dropped to its lowest level in eight years as the effects of the coronavirus crisis intensify, a survey revealed.

The IHS Markit household finance index fell to 42.5 in March from 47.6 the previous month, reflecting the most pessimistic outlook towards job security since December 2011, a survey of UK consumers in the five days to March 17 showed.

Respondents reported virtually no growth in incomes from employment during March.

Citi to give $1,000 bonus to all US employees earning less than $60,000

Laura Noonan in New York

Citigroup is giving $1,000 to all US employees earning less than $60,000 to help “ease the financial burden” of the coronavirus crisis.

Chief executive Mike Corbat announced the one-off payment in a memo to staff on Monday. The payments will be made mostly in April, with local currency equivalents for staff in other countries that have been hit hard by the virus.

Other banks have also made cash payments to their staff, although these have largely focused on childcare.

“This is a challenging time for our families, communities and for our firm, but we’ve proven our ability to get through tough times before, and we’ll get through this one as well,” Mr Corbat said.

Case for dollar intervention by Fed ‘reasonably strong’ — Goldman

The case for the Federal Reserve to intervene in the foreign exchange market is “reasonably strong”, according to Goldman Sachs, because of the risk that further strength in the dollar poses to US and global growth.

Rather than selling dollars to buy euro and yen, which the Fed already holds in its foreign exchange reserves, the bank reasons policymakers may get better bang for their buck by purchasing the currencies of several important trading partners like Mexico and Brazil and possibly those of Norway, South Korea, Canada and Australia.

This month, the US central bank took a series of measures aimed at supporting the economy and stabilising markets as coronavirus continued to spread globally. As well as cutting interest rates to near zero, the Fed introduced  swap lines to boost US dollar funding to at least 14 countries against the backdrop of global financial institutions clambering to buy the world’s reserve currency.

“Although the Fed’s swap lines are an important tool, they may be unable to stabilise the dollar in spot markets,” Goldman strategist Zach Pandl warned in a note on Monday.

If the dollar, which has staged a historically quick jump of about 8 per cent on a trade-weighted basis in the past two weeks, continues to rise, “we would see a reasonably strong case for targeted intervention, and think there is a rising probability that authorities will take this step,” Mr Pandl wrote.

Goldman thinks a starting point for policymakers could be if the Treasury engages with the countries with which swap lines have been established to discuss whether US-directed intervention would be appropriate.

If there are willing parties, Treasury could “jointly establish purchase quantities and exit criteria” ie “co-ordinated” intervention. Since 1995, authorities have only intervened three times, and always in agreement with G7 partners.

A subsequent step could be purchasing the currencies of important trading partners. The US at present only holds euro and Japanese yen in its foreign exchange reserves. Given both countries have weak economies, low inflation and limited foreign currency-denominated debt, Mr Pandl said “we do not think either currency would be ideal to buy in a co-ordinated intervention today”.

The economies of several other important trading partners better fit those conditions, though, including Mexico and Brazil, Mr Pandl pointed out. If the dollar were to appreciate to “more extreme levels”, the intervention could broaden out to include the currencies of Norway, South Korea, Canada and Australia as well. Those currencies represent about one-third of the trade-weighted dollar index, “so preventing further dollar appreciation against these crosses could help protect US financial conditions and growth”.

Norway fines infected partygoer for flouting rules

Richard Milne in Oslo

A young person in western Norway has been fined NKr20,000 ($1,800) for going to a party at the weekend while infected, part of a broader crackdown on people ignoring social distancing rules by European authorities.

Police refused to give the gender or age of the person but warned that if the fine was not paid, they would be sentenced to 40 days in prison.

“We hope people understand the seriousness of the situation the country is in, and stick to the laws, rules, and regulations,” said Gunnar Floystad of the western Norwegian police district.

Authorities in a number of countries including Norway have expressed concern about so-called quarantine parties, particularly among young people. All the other participants at the party will be put in quarantine and reminded of the importance of sticking to the rules, the police said.

UN calls for ‘global ceasefire’ in light of pandemic

The head of the UN has called on global leaders to stop fighting in all war zones so countries can focus on a universal enemy — the Covid-19 pandemic.

“The virus does not care about ethnicity or nationality,” António Guterres said in a virtual news conference on Monday. “Meanwhile conflict rages around the world. Those who are marginalised and displaced pay the greatest price. That is why I am calling on an immediate global ceasefire.”

The fighting only increases suffering and makes responding to the virus even more difficult. Warring parties, I say pull back, silence the guns.

The UN secretary-general in his speech focused on the need for countries to come together to work on a humanitarian solution, to open corridors for life-saving virus treatment and to bring hope to places most vulnerable to Covid-19.

We can start by stopping the fighting now everyone. That is what our human family needs now more than ever.

India imposes full curfew after people violate rules

Amy Kazmin in New Delhi

India has imposed full curfew in the capital city Delhi, its financial capital Mumbai and large parts of the country after the prime minister told states to enforce a lockdown order aimed at keeping people at home.

Many parts of India were under their first day of lockdown on Monday, with all but non-essential businesses closed and public transport suspended. But some took it as a day off, lounging with friends in public spaces, congregating outside shops or playing cricket.

“Many people are still not taking lockdown seriously,” Narendra Modi said in Hindi on Twitter. “Please save yourself, save your family, follow instructions seriously. I request state governments to ensure rules and laws are followed.”

Hours later, states across India said they were imposing a fully fledged curfew, more typically seen during riots or in conflict-affected regions such as Kashmir, until March 31.

Under the more stringent orders, no one other than government employees will be permitted outside their homes without a police-issued curfew pass. That means workers in private hospitals, grocery stores, pharmacies and other essential services must obtain passes before returning to work.

Michigan tells residents to stay at home until April 13

Claire Bushey in Chicago

Michigan governor Gretchen Whitmer ordered the state, heart of US car manufacturing, to remain at home for at least the next three weeks starting tomorrow.

Ford, General Motors and Fiat Chrysler said last week they would shut their US plants to help contain the spread of coronavirus. They took the step after pressure from the United Auto Workers, which was hearing from factory workers worried about exposure.

Ford and General Motors said they would shut down until at least March 30. The governor’s order will take them two weeks past that date to April 13.

Ms Whitmer’s order shutting all non-essential businesses begins March 24. Essential businesses include health care, law enforcement and grocery stores.

“The current trajectory we’re on looks a lot like Italy,” she said.

Emoticon Global stocks tumble as volatility takes its toll

Wall Street stocks have tumbled during trading on Monday, as market volatility persisted despite the Federal Reserve announcing there would be no limit to its bond purchase programme.

All three of Wall Street’s main indices fell sharply: the S&P 500 fell 4.9 per cent, while the Dow Jones Industrial index dipped 4.1 per cent and the Nasdaq shed 2.9 per cent.

“The bottom is falling out of US stocks in a disorderly manner,” said Mohamed A El-Erian, chief economic adviser to Allianz, on Twitter. “The damage to some individual names is eye popping. Disappointingly, the earlier massive Fed policy intervention is yet to prove sufficient given rapidly-worsening fundamentals, delayed Congressional action and the damage already incurred.”

Across the Atlantic, the European benchmark Stoxx 600 declined 4.6 per cent. London’s FTSE 100 dropped 4.2 per cent.

Africa needs $100bn stimulus to tackle virus

Neil Munshi in Lagos

African finance ministers have called for a $100bn stimulus package to help the continent that experts warn is least equipped to combat the coronavirus pandemic, the UN Economic Commission for Africa said.

“Africa needs an immediate emergency economic stimulus to the tune of $100bn,” the commission’s statement said on Monday. It would include $44bn in waived interest payments for 2020 on both sovereign bonds and public debt.

The call came as the number of cases rapidly increased on the continent, although it remains among the least impacted regions in the world.

Observers have warned that the health systems and economies of many countries in sub-Saharan Africa will be sorely tested by the pandemic.

Mexico will not turn to IMF to weather crisis, says López Obrador

Jude Webber in Mexico City

Mexico’s government will tighten its belt and weather the coming economic storm by strengthening social programmes, sticking to priority investment projects including a new refinery and new airport and not taking on debt, President Andrés Manuel López Obrador said.

He said the economic recovery plan would be announced “soon” and it would be “different to the prescriptions they used to apply in times of crisis, which was always to have recourse to the IMF. Fortunately, we don’t need to do that because we have reserves, we have savings and we can finance our development”.

The president was speaking after the announcement that a government people’s poll, which he has vowed to respect, had voted overwhelmingly against a $1.4bn Constellation Brands brewery project. The peso sank to a new historic low of more than 25 to the dollar on the news and economists are already pencilling in an economic contraction of as much as 5 per cent this year.

Half of Mexico’s economy is in the informal sector, where workers receive no benefits, and Mr López Obrador said he would be increasing loans to them, but gave no details.

In addition, he said the government would “tighten its belt” but would continue with its priority airport, refinery and train projects “because they mean jobs”. Asked if he would take on debt — he has long promised not to raise debt or taxes — he told his morning news conference: “No.”

India recommends use of malaria drug for some individuals

Stephanie Findlay in New Delhi

India’s national task force for Covid-19 has recommended the use of hydroxychloroquine for prophylaxis, clearing the drug for preventative treatment of coronavirus for healthcare workers and high-risk individuals.

The task force recommended using the drug, traditionally taken either to prevent or treat malaria, for “asymptomatic healthcare workers involved in the care of suspected or confirmed cases of Covid-19” and “asymptomatic household contacts of laboratory confirmed cases”.

In a Monday advisory, the task force cautioned that “the placing of healthcare workers under chemoprophylaxis should not instill a false sense of security” and that the drug should only be given on the prescription of a medical practitioner.

The advisory comes after US president Donald Trump tweeted that hydroxychloroquine may have a “real chance” to be a “game changer”, although experts warn that it has not been tested in large-scale clinical trials.

Ipca, a top Indian drugmaker, said in a notice to the BSE over the weekend: “We are noticing an increase in the emergency demand and enquiries for the chloroquine phosphate and hydroxychloroquine sulphate APls and its formulations from several countries world over.”

It also noted that the drugs “are not approved for treatment by any regulatory authority”.

Massachusetts and Wisconsin to issue stay-at-home orders

Massachusetts and Wisconsin are set to become the latest states to issue orders requiring people to stay at home in an effort to stem the coronavirus outbreak.

Governor Charlie Baker issued an emergency order to close all non-essential business in Massachusetts. He also directed the state’s department of public health to issue a stay-at-home advisory to residents. The orders takes effect Tuesday, and will continue until April 7.

Meanwhile, Wisconsin governor Tony Evers said he will issue an order telling residents to stay at home and non-essential businesses to close with effect from Tuesday, after saying on Friday he did not think such a move would be necessary.

Massachusetts has 646 confirmed cases and has attributed five deaths to Covid-19. Wisconsin had 381 confirmed cases and four coronavirus related deaths.

California, New York and New Jersey have already issued shelter in place orders. The US has 15,219 confirmed cases and the death toll has climbed to 201.

Wizz Air says grounding of fleet ‘distinct possibility’

Peggy Hollinger in London

Wizz Air became the latest airline to say it could ground its entire fleet as governments crack down on international travel in an attempt to halt the widening coronavirus pandemic.

The low-cost central and eastern European carrier, which before the crisis flew to 45 countries, said 85 per cent of its aircraft had been parked, with operations continuing only in Romania, Hungary and Bulgaria.

“The grounding of the entire fleet remains a distinct possibility over the next period, as potential additional travel restrictions and social distancing policies issued by authorities may make international flying for commercial purposes either untenable or impossible,” the airline said in a statement.

The group’s top management and board were giving up their sales for the next five weeks in an effort to contain costs, while third-party spending, overheads and non-essential capital expenditure were also being cut. Staff were being offered options to cut working hours or take leave.

József Váradi, chief executive, insisted the group’s financial position was robust enough to survive the current constraints and that it intended to be a “long-term winner” from the crisis destabilising global aviation.

The group has €1.2bn in net cash, a spokesman said.

However Mr Váradi stressed the need for governments to act quickly on measures to help support the wider aviation industry through the crisis.

This situation is posing a significant threat on the aviation industry and we call on governments to take non-discriminatory steps which will benefit all airlines. This will enable an industry and environment that is healthy, efficient and more environmentally sustainable.

Wizz Air employs 5,000 people, of which some 300-400 are in the UK, where it has an operating licence. As a result it is potentially eligible for measures expected from the UK government this week.

EU eases restrictions on suppliers to safeguard flow of goods

Javier Espinoza, EU correspondent:

The EU has said suppliers can co-ordinate efforts on getting scarce products out to market, following in the footsteps of the UK competition authority, which last week eased rules to allow supermarkets to work together.

The European Competition Network, which consists of the European Commission and the bloc’s 27 national competition authorities, said:

The ECN understands that this extraordinary situation may trigger the need for companies to co-operate in order to ensure the supply and fair distribution of scarce products to all consumers.

In the current circumstances, the ECN will not actively intervene against necessary and temporary measures put in place in order to avoid a shortage of supply.

New York calls for more resources

The number of coronavirus cases in New York has risen by 5,707 in the past 24 hours, the governor has just announced, bringing the total number of cases to 20,875.

New York has been far worse hit by the virus than other US states — the second-hardest hit has been New Jersey, which has only 1,914 cases by comparison. With 621 people in the state currently in intensive care, Governor Andrew Cuomo is calling for hospitals to increase their capacity by 50 per cent to deal with the influx.

He also announced the state was allowing doctors to use hydroxychloroquine and Zithromax, the cocktail of drugs that has achieved some success in treating the disease elsewhere. And they will also be allowed to use an experimental blood plasma treatment on patients in a particularly serious condition.

But his main message has been that the state needs more resources to help fight the outbreak. “Fund the need,” he said.

Gold bars in short supply due to coronavirus disruption

Henry Sanderson, metals and mining correspondent:

Traders have reported a growing global shortage of gold bars, as the coronavirus outbreak both disrupts supply and stokes demand.

Retail investors in Europe and the US have bought up gold and silver bars and coins over the past two weeks in an effort to protect their money from the collapse in global stock prices and many currencies. But Europe’s largest gold refineries have struggled to keep up because of the region’s widening shutdown.

Markus Krall, chief executive of German precious metals retailer Degussa, said it was struggling to meet customer appetite for gold bars and coins and demand is running at up to five times the normal daily amount.

“We’re restricted to what we can get hold of, it’s a bit like toilet roll,” said Rob Halliday-Stein, founder and managing director of BullionbyPost.

Read the full story here

US gasoline futures plummet

US gasoline futures have dropped 17 per cent today, underlining the chaos the coronavirus spread is causing in energy markets.

New York harbour wholesale gasoline was trading around $0.5 a gallon at its lowest level in almost two decades. Gasoline futures have now fallen 70 per cent this year as oil has plummeted, driven by the spread of coronavirus draining demand and the Saudi-Russia price war flooding the market.

Brent crude, the international oil benchmark, has fallen over 60 per cent this year to around $26 a barrel.

President Donald Trump has maintained that the collapse in oil prices will be good news for US motorists as it would send gasoline prices lower. “Good for the consumer, gasoline prices coming down!” he tweeted this month.

Forecasts show dire 2020 for global economy

Valentina Romei in London

Economists are revising down their global growth forecasts for this year as the coronavirus crisis hits production, jobs and consumption.

The G7 economies are expected to shrink sharply in 2020, according to Consensus Economics, a company that averages forecasts from more than 700 economists each month.

As of March 23, economists expect the US to shrink 0.7 per cent this year, down from a nearly 2 per cent expansion forecast in January. The UK is set to contract nearly 2 per cent, while output in Japan, Germany and France is expected to fall between 2 per cent and 3.3 per cent.

Italy is the worst hit among the G7, according to economists, with its gross domestic product set to shrink over 5 per cent in 2020, while the pace of China’s economic growth is revised down to one third of January’s forecasts.

Europe’s consumer confidence drops to lowest level in 5 years

Mehreen Khan in Brussels and Martin Arnold in Frankfurt:

The first set of eurozone sentiment surveys from March show a steep drop in consumer confidence in Europe, to the lowest level in at least five years and likely to get much worse.

The European Commission’s monthly survey of consumer sentiment fell 5 points in the eurozone this month and 4.5 points across the EU this month, dragging the gauge to its lowest since 2014.

The commission warned that the actual extent of the slump is likely to be worse as most of the survey respondents replied before sweeping confinement rules were imposed in countries like Italy, Spain, and France.

Consumers are braced for a wave of insolvencies and redundancies after governments from Italy to Germany imposed severe lock-downs on their populations.

Economists have rushed to slash their growth forecasts for this year, as the lockdowns imposed across Europe have become increasingly tough. Credit Suisse on Monday predicted the eurozone economy would shrink 4 per cent this year, before growing 5 per cent next year. The UK would contract 3.8 per cent this year and grow 4 per cent in 2021, it said.

Demand weakens for US dollar following Fed announcement

Eva Szalay reports:

The dollar regained some of its footing after an initial steep slide following the Federal Reserve’s announcement that it would commit to unlimited asset purchases, which eased demand for the safe-haven US currency. The dollar is still broadly weaker as a result of the US central bank’s latest move.

The US currency weakened immediately after the announcement, losing 0.7 per cent following the announcement to trade at ¥‎109.98. The euro rallied against the dollar and gained more than 1 per cent to trade at $1.0798. Even the Australian dollar, which was under heavy selling pressure earlier, managed to appreciate slightly. The pound earlier traded more 1 one per cent lower against the dollar, but reversed losses to turn positive on the day and trade at $1.1650.

But just a couple of hours after the Fed’s move, the dollar gained ground against the pound and it recovered against the Japanese yen, although both the euro and the Australian dollar managed to hold gains.

US retailers take on thousands of extra workers

Alistair Gray in New York

Two of the biggest US retailers are taking on up to 100,000 workers to cope with a surge in demand, giving some relief to the labour market as the country prepares for a jump in unemployment caused by the coronavirus shutdown.

Drugstore chain CVS Health said it was looking to fill 50,000 positions immediately as consumers load up on medication and essential household goods. Discount retailer Dollar General said it wanted to fill “up to” 50,000 roles by the end of next month.

The latest retail hiring sprees follow Walmart’s announcement that it was hiring 150,000 extra staff and Amazon 100,000.

The roles, which include store workers, home delivery drivers, warehouse workers and customer service specialists, will give opportunities to some of the workers made redundant in other industries, from leisure and hospitality to discretionary retail.

Dollar General added that most of its roles were likely to be temporary.

CVS said its hiring push was the most ambitious in its history and that it was looking to fill some full- and part-time, as well as temporary, positions. It added that many roles would be filled by staff at some of its corporate clients that have had to furlough employees, including hotel chains Hilton and Marriott.

‘No limit’ to EU response to pandemic, says eurogroup head

Peter Wise in Lisbon reports:

There will be “no limit” to Europe’s response to the coronavirus pandemic, the head of the eurogroup of eurozone finance ministers said on Monday.

Speaking in Lisbon, Mário Centeno, Portugal’s finance minister, said the European Central Bank, the European Commission and national governments were working with “a high degree of coordination” to deliver a “very significant” economic response that focused on social solidarity.

This was being achieved by providing liquidity to economies, special layoff regimes for hard-hit companies and the postponement of tax and social security payments, among other measures, he said.

Mr Centeno dismissed suggestions he was considering resigning from government, saying he was “totally focused” on responding to the pandemic, both as Portugal’s finance minister and head of the eurogroup.

Portuguese commentators had suggested Mr Centeno was preparing to leave government long before the coronavirus crisis. The minister’s comments followed talks with Marcelo Rebelo de Sousa, Portugal’s president, which had prompted speculation that the president planned to persuade Mr Centeno not to resign.

Deaths caused by the coronavirus in Portugal increased from 14 to 23 in the 24 hours to midnight on Sunday, the health authority reported. The number of confirmed Covid-19 cases rose to 2,060, an increase of 460 cases, or almost 29 per cent, over the same period.

António Sales, secretary of state for health, said 165 health workers has contracted the virus, including 82 doctors and 37 nurses. Concern has increased over contagion within care homes for the elderly, he said. Some care homes have said they lack the protective equipment and facilities to implement official guidelines for combating the pandemic.

Freeport halts dividends and reviews operations

Neil Hume in London

Freeport-McMoran has suspended dividends and launched a review of its operations as the price of copper, the miner’s key commodity, trades at its lowest level in four years.

The US-listed group said on Monday it would no longer pay a quarterly dividend of 5 cents a share planned for May. Future payments will depend on its performance, cash requirements and global economic conditions.

The news came as the price of copper, the world’s most important industrial metal, dipped below $4,500 a tonne. It has this month fallen more than $1,000, or 20 per cent, on fears the coronavirus outbreak will lead to a deep global recession, denting demand for raw materials.

Freeport launched an “aggressive review” of operating plans at its mines with the aim of reducing costs and capital spending and boosting cash flow. This could result in temporary production cuts at its operations in the Americas.

“The prudent steps we are taking to address costs and capital spending and preserve a strong liquidity position are necessary to maintain flexibility as we respond to current global economic uncertainties and the resulting sharp decline in copper prices in recent weeks,” said Freeport executive Richard Adkerson.

Shares in Freeport, the world’s biggest independent copper producer, are down 57 per cent this year.

The company was badly scared during the last commodity price crash in 2015, when it was forced to sell assets to pay down debt. It has entered this downturn in better financial shape.

At current prices, traders reckon more than 15 per cent of the global copper industry is not generating cash.

Pakistan deploys troops nationwide to enforce lockdown

Farhan Bokhari in Islamabad reports:

The Pakistani government on Monday deployed troops across the country to help enforce a nationwide lockdown, as the number of cases of coronavirus rose to more than 800 — over 10 times the number 10 days ago. At least six people have died.

Units of army troops have been deployed to the Pakistani capital Islamabad, the four main provinces, the part of Kashmir controlled by Pakistan and the northern Gilgit-Baltistan region along the border with China. The deployments coincided with a lockdown order by Punjab, Pakistan’s most populous province and home to about 60 per cent of its population, which will be in effect until April 6.

“They [troops] are being deployed so that a lockdown can be fully enforced. Except for essential services like grocery and medicinal sale points, hospitals and other very essential services, everything will be shut,” a senior government official told the FT.

Train and bus services between cities have already been stopped to discourage travel within the country.

Pakistan’s health services have been overwhelmed by cases of coronavirus. Officials say the condition mainly spread in Pakistan from Muslim pilgrims who returned from Iran.

Analysts have criticised prime minister Imran Khan’s government for failing to enforce a quarantine facility at Taftan, Pakistan’s first border town for incoming travellers from Iran.

One Pakistani doctor in the southern port city of Karachi told the FT:

Timely action was necessary to ensure that the travellers from Iran were properly screened at Taftan. What we have subsequently found is that many of those [travelers] were able to return to our main cities where they passed on their condition to others.

Gold regains shine after Fed pledges unlimited bond buying

Neil Hume in London

Gold has regained some of its lustre after the US Federal Reserve committed to unlimited purchases of Treasuries and other securities.

The new moves to shore up financial markets and help struggling companies could stoke inflation, according to experts.

Gold, which was trading at about $1,490 before the US central bank announced its open-ended bond buying programme, gained 1.7 per cent to $1,522 a troy ounce.

The precious metal’s reputation as a safe place to keep cash in times of turbulence has taken a knock in recent weeks. Gold, along with every other asset class, has fallen as investors have sold everything in a dash for cash.

Gold peaked at $1,702.56 an ounce on March 9, a jump of 13 per cent from the end of last year.

It then dropped almost 15 per cent to a low of $1,450 an ounce last week before starting to pick up and accelerating on Monday on the Fed’s move.

Borrowing costs surge for poorest nations

Steve Johnson reports:

Borrowing costs for the world’s poorest nations have ballooned in recent weeks, just as collapsing commodity prices and tourism revenues threaten to slash government revenues.

Government bond yields for 23 low- and lower-middle income countries have jumped 3.5 percentage points to 10 per cent since late February as the fallout from the global coronavirus crisis has fuelled a dramatic retreat from risky assets, according to the Jubilee Debt Campaign, a non-governmental organisation. The 23 countries include Angola, Ethiopia, Kenya, Nigeria and Pakistan.

The IMF had warned in October that 34 of the 70 frontier countries it assesses were at high risk of falling into debt distress or were already distressed, up from zero in 2014.

The Jubilee Debt Campaign highlighted Zambia as among those most at risk of default. Yields on its sovereign debt maturing in April 2021 have increased to 36 per cent. Oil-dependent Chad is another nation, according to the JDC, alongside the Maldives, which is reliant on tourism and “could be a very worrying sign of what’s ahead for many small island states”.

Tim Jones, head of policy at the JDC, said: “Urgent action is needed to support poor countries being hit by the economic impacts of coronavirus, including a complete moratorium on debt payments for those most affected. The IMF needs to cancel debts owed to it by countries suffering the impact of the pandemic.”

Toyota to suspend production at five Japanese plants

Kana Inagaki in Tokyo reports:

Toyota said it will halt production at five factories in Japan from early April due to a fall in overseas demand caused by the coronavirus outbreak.

The shutdown will last between two to nine operating days from April 3, the company said on Monday.

Earlier in the day, Japan’s largest carmaker said it would temporarily suspend operations at its plant in India.

Over the weekend, Toyota announced that it would suspend one of its production lines at a plant near its headquarters in Aichi prefecture after a second plant worker tested positive for the coronavirus.

The company announced its first case of Covid-19 infection at its Takaoka plant in Toyota city last week, and had asked 33 employees who worked closely with the two infected workers to stay at home.

US stocks wipe out gains since Trump inauguration in 2017

Wall Street stocks have surrendered the gains that followed Donald Trump’s inauguration more than three years ago.

The S&P 500 tumbled almost 2 per cent on Monday bringing the plunge for March to around 23 per cent. The fall has now been so steep that the barometer has wiped out all of the gains since Mr Trump was sworn in as president on January 20, 2017. At the peak, which was just a month ago, stocks had been up by 50 per cent since the inauguration.

The fall is politically significant because Mr Trump has regularly touted the stock market’s performance during his tenure. 

South Africa becomes African nation with highest number of cases

Joseph Cotterill reports:

South Africa has surpassed Egypt to become the African nation with the highest number of confirmed Covid-19 infections after reported cases rose to 400.

South Africa’s health ministry said on Monday that confirmed cases had risen to 402, up 128 versus the day before. Egypt has reported 327 cases and 14 deaths to date. No deaths have been recorded in South Africa.

South Africa significantly expanded testing for the virus in recent days, to a total of over 12,000 as of Monday, and backlogs of test results have been reported at labs.

Later on Monday President Cyril Ramaphosa is due to deliver a national address to South Africans that is likely to tighten the country’s measures against the spread of the virus, which have already included travel bans, a prohibition of large gatherings, and school closures.

Virus controls will hit Easter, Ramadan and Passover, Macron says

Victor Mallet in Paris

French President Emmanuel Macron has warned religious leaders that the Christian festival of Easter, the Muslim holy month of Ramadan and the Jewish Passover cannot be celebrated with the normal gatherings because of “social distancing” controls imposed to slow the spread of the coronavirus pandemic.

In a teleconference on Monday, Mr Macron warned representatives of various religions that festivals due in April would have to be “celebrated in a different way”, according to some of those on the call.

Passover begins this year on the evening of April 8, Easter Sunday is on April 12, and Ramadan is expected to start in France on April 23.

GE Aviation to lay off 10% of US workforce

The aviation wing of General Electric is laying off 10 per cent of its workforce in the US as it looks to “aggressively mitigate” the effects of the coronavirus pandemic which has ripped through the industry.

GE Aviation, which makes jet engines, pointed to the “rapid contraction” of air travel as governments curb the free movement of people in a bid to stem the spread of the virus.

The company said this had caused a “significant reduction in demand” for its products as airlines across the world ground their fleets.

GE Aviation — which employs around 40,000 people globally — said half of its US maintenance, repair and overhaul employees would also be out of work for 90 days.

The group has already culled its contractor workforce, implemented a hiring freeze, cancelled salary raises and slashed non-essential spending.

David Joyce, GE Aviation chief executive said he would forego half of his salary for the year. Lawrence Culp, chairman and chief executive of the parent group, GE, will forego his full salary for the rest of 2020.

Uzbekistan to lock down capital Tashkent

Henry Foy in Moscow

Uzbekistan is quarantining its entire capital city, in a bid to keep coronavirus infections from spreading to the rest of the country.

Tashkent is home to all but one of the central Asian country’s 46 confirmed Covid-19 cases, and Uzbek authorities said all the roads, railway lines and flights out of the city would be closed from Tuesday.

Trucks bringing in food and other goods are exempt from the lockdown and people with proof of permanent residency would be permitted to enter the city, but not leave.

Uzbekistan is central asia’s most populous country with 34m people and Tashkent is the largest city in the region, which borders China to the east and Iran to the south.

Saudi coronavirus cases total 562

Ahmed Al Omran in Riyadh

Saudi Arabia announced 51 new cases of coronavirus on Monday, bringing the total number of cases in the kingdom to 562.

King Salman has ordered a curfew from 7pm to 6am local time starting Monday for a period of 21 days, the latest in a series of precautionary measures to fight the virus spread. Those who violate the curfew face a SR10,000 ($2,666) fine and up to 20 days in prison, the interior ministry said.

The kingdom has not reported any deaths from Covid-19 so far.


US stocks drop 3% after tumultuous trading in futures market

US stocks tumbled 3 per cent within the first 10 minutes of trade as the volatility that has gripped Wall Street in recent weeks persisted.

The S&P 500 was down 2.9 per cent in recent dealings, following a plunge of more than 20 per cent over the previous fortnight.

Trading in US stock-index futures was particularly choppy on Monday, with S&P 500 futures trading in a 9.8 per cent range between its highs and lows. The Federal Reserve’s announcement that it is prepared to unleash an unlimited amount of bond buying briefly cheered markets, but the gains rapidly fizzled.

Iranian state broadcaster says 19 of its reporters have coronavirus

Najmeh Bozorgmehr in Tehran

At least 19 journalists from Iran’s state broadcaster have been infected with coronavirus while one journalist from the country’s Fars news agency is reported to have died from the disease.

Abdollah Seyed Ahmadi — a senior editor at Fars, which is affiliated with the Revolutionary Guards — died on Monday of Covid-19 in Tehran, the agency confirmed.

Mehrdad Seyed Mehdi, head of the news agency IRIB, the state broadcaster, said in a post on Twitter that the 19 journalists had been on the frontline and had been to ICU sections to warn people of the risks of the illness.

State radio and television have been urging people to practise social distancing by interviewing patients, nurses, doctors and officials and educating Iranians how to adopt preventive measures.

IRIB has also been on the road embarrassing people who have been ignoring official warnings and travel and so making it a bigger challenge for the country to contain the spread of coronavirus.

Many people on social media blame travellers for being guilty of increasing the burden on the medical system and have called on officials to quarantine cities.

About two-dozen health workers and doctors have died of the coronavirus. The head of Qom Medical Science University said on Monday that 170 doctors and nurses in Qom — the origin of the disease in Iran — had tested positive for Covid-19, two of whom had died.

Abu Dhabi’s Etihad Airways to halt passenger flights

Simeon Kerr in Dubai

Abu Dhabi’s Etihad Airways will temporarily suspend passenger flights from late on Wednesday for 14 days in line with the United Arab Emirates’ directives seeking to limit the spread of coronavirus.

The suspension of flights to, from and via Abu Dhabi will start at 23:59 local time on March 25. Cargo and emergency evacuation flights will continue.

“These are unprecedented times and unprecedented decisions are being made by governments, authorities and companies, including Etihad, to contain the spread of the coronavirus and to help minimise its effects around the world,” said Tony Douglas, chief executive of Etihad.

The move mirrors a similar decision by Dubai’s Emirates.

Mnuchin says White House close to $2tn stimulus deal

Lauren Fedor in Washington

US Treasury secretary Steve Mnuchin said the White House is “very close” to a nearly $2tn stimulus deal with congressional Republicans and Democrats, after bipartisan talks stalled at the weekend.

“We need to get this thing passed today,” Mr Munchin told CNBC on Monday morning. “We need to put aside partisan politics.”

Mr Mnuchin spent the weekend negotiating with Mitch McConnell, the Senate’s top Republican, and Chuck Schumer, the upper chamber’s most-senior Democrat. Nancy Pelosi, the Democratic speaker of the House, has also been involved in discussions to prop up the US economy as the novel coronavirus continues to spread. But talks faltered on Sunday after Democrats said the proposed stimulus package was too generous to big businesses.

Mr Mnuchin told CNBC he would meet Mr McConnell on Monday morning before sitting down with Mr Schumer.

The Senate remains in session, even after Rand Paul, the senator from Kentucky, became the first senator to test positive for Covid-19 at the weekend. The Senate is expected to convene at noon on Monday.

Germany fires warning shot at hedge funds on prowl for virus-hit groups

Guy Chazan in Berlin

Germany’s economy minister has warned hedge funds not to try to pounce on German companies hit by the coronavirus pandemic, saying a government-backed bailout fund stood ready to protect strategic businesses from foreign predators.

I say to all those people in hedge funds and elsewhere who are looking forward to acquiring one or other [German company] on the cheap: make no mistake about it, we are determined to stand by our companies in this situation.

Peter Altmaier was speaking after the cabinet approved the creation of an “economic stabilisation fund” equipped with €100bn to recapitalise German companies hit by the fallout from the Covid-19 pandemic. The fund will have the power to take stakes in stricken companies.

The fund will have a guarantee framework of €400bn to make it easier for companies to refinance themselves on capital markets and will offer €100bn in loans to refinance loan programmes provided via KfW, the German state development bank.

Only companies with revenues of more than €50m a year, more than €43m on their balance sheet and more than 249 workers will qualify for aid from the fund.

The cabinet passed a supplementary budget for 2020, which envisages €122.5bn in extra spending and a €33.5bn drop in tax revenues for the year. The government will take on new debt to the tune of €156bn, marking a radical break from its policy of the “schwarze Null” or “black zero”: balanced budgets and no new borrowing.

The budget includes a €50bn fund to help small businesses and the self-employed, and €3.5bn in extra spending on protective equipment for doctors, work on a coronavirus vaccine and the repatriation of German holidaymakers stuck abroad.

Treasuries rally after Fed says it is prepared to accelerate bond buying

US government debt rallied sharply on Monday after the Federal Reserve said it was prepared to accelerate its bond purchases to shore up the economy.

The 10-year Treasury yield dropped 0.18 percentage points to 0.761 per cent in recent dealings, signalling a sharp rally in the price of the debt. Other portions of the US sovereign bond market also rallied.

The Fed said on Monday it was prepared to buy bonds “in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions and the economy.”

The Fed had originally planned to purchase at least $500bn in US Treasuries and at least $200bn in agency mortgage-backed securities. In recent days it has boosted the pace of these purchases, after earlier interventions failed to address strains that had emerged in both debt markets. 

The move came after Congress on Sunday remained deadlocked on passing a vast fiscal stimulus programme meant to shore up the US economy.

“The Fed has attempted to fill the void created by paralysed fiscal policy,” said Thomas Simons, economist at Jefferies.

“These steps are quite significant, but still do not address all of the issues that need to be addressed. The political leaders still need to get a game plan going here or the masses will suffer.”

India to halt domestic passenger flights

Benjamin Parkin in New Delhi

India will halt domestic passenger flights from Wednesday as it tightens lockdown measures put in place in recent days.

The government said that no more flights will run after Tuesday night, adding to last week’s restrictions on incoming international flights. It did not say when services would resume.

India’s central and state governments have set out measures putting large parts of the country, including the capital New Delhi and financial hub Mumbai, into varying degrees of shutdown. Authorities have suspended rail and metro services. Domestic cargo flights will continue.

The measures have become stricter amid concerns that India, which has reported 415 cases of Covid-19, could be vulnerable to a large outbreak due to its densely populated cities and areas.

Prime minister Narendra Modi said on Monday that people were “not taking the lockdown seriously”. Authorities have vowed legal action against those who violate restrictions.

France sets up ‘crisis committee’ to ease corporate credit fears

Leila Abboud in Paris

France’s economy ministry and central bank are creating a “crisis committee” to help resolve the emerging issue of companies delaying or not paying each other for goods or services rendered.

In a joint statement minister Bruno Le Maire and central bank governor François Villeroy de Galhau said the committee “would be able to handle in real-time the gravest cases in which credit between companies deteriorates”, in particular for small and medium-sized companies.

That the government put in place such a structure shows that the issue poses a real challenge to the economy. France has been trying to keep some parts of the economy going despite closing schools, restaurants, bars and cultural institutions.

Downing Street warns of stricter restrictions if people flout advice

George Parker, political editor, reports:

Boris Johnson’s spokesman has said the prime minister would “not hesitate” to introduce new restrictions on movement if data showed that people were ignoring government advice on social distancing.

Number 10 said the prime minister could act “quickly” and rejected suggestions that he was facing unrest from ministerial colleagues who believe new restrictions should already been in place.

“People should stay at home if possible,” the spokesman said.

If the information we are getting shows that social interaction has not stopped as we had hoped, we could take further measures.

H&M warns of ‘tens of thousands’ of layoffs

Richard Milne, Nordic and Baltic correspondent

Hennes & Mauritz warned that it would have to layoff tens of thousands of workers and cancelled its dividend, as the world’s second-largest clothes retailer surveyed the damage from the coronavirus outbreak, which has closed more than two-thirds of its 5,000 shops worldwide.

The Swedish group said it was unable to specify how many temporary lay-offs would be needed but that it was “likely to affect tens of thousands of employees in all parts of the business”. It added that it might be necessary to terminate employment in some cases due to the impact of coronavirus on its business.

Chief executive Helena Helmersson, who only started in the job eight weeks ago, said:

We are doing everything in our power in the H&M group to manage the situation related to the coronavirus. My hope is that we will be able to get operations up and running again as soon as possible and welcome back all our customers in all our 74 store markets. This is an extraordinary situation in which we are forced to make difficult decisions,

It is withdrawing its proposal to pay a dividend of SKr9.75 per share for last year “to further strengthen the company’s already strong financial position and thereby secure our freedom of action going forward,” said Stefan Persson, chairman and the largest owner of the retailer.

German economy to shrink 5 per cent this year

Guy Chazan in Berlin reports:

Olaf Scholz, the German finance minister, said the German economy would shrink by 5 per cent this year as the coronavirus pandemic spreads.

“We looked at what others’ estimates were, and calculated ourselves, and then decided that we will see a big decline this year, as during the last financial crisis,” he told reporters.

We arrived at a figure of about 5 per cent, and said that would mean lost tax revenues of about €35bn.

He was speaking after the German cabinet adopted a supplementary budget for 2020.

BlackRock pledges $50m in coronavirus relief

Richard Henderson in Melbourne

BlackRock, the world’s largest fund manager, has committed $50m to support people impacted by the coronavirus.

The company will target organisations around the world that are integral to relief efforts to help address “financial hardship and social dislocation” caused by the pandemic. The first tranche of $18m will go to food banks in the US, including $5m to Feeding America, which aims to raise $100m to help respond to the pandemic.

Money will also be given to food bank operators in Italy, Spain, France and the UK. The company has also supported Give2Asia, a group that has provided support to hospitals in Asia.

The money will “help address the financial hardship and social dislocation that this pandemic brings in its wake, as families grapple with job disruptions, school closures, and unexpected childcare and medical costs,” Larry Fink, chief executive of the New York-based firm, said on Monday.

UK in talks with Amazon to deliver test kits

Pilita Clark and Jim Pickard in London and Dave Lee in San Francisco

The UK government has approached Amazon and other companies about using their services to urgently increase the delivery of coronavirus tests to frontline health and social care workers.

Workers at hospitals and care homes for the elderly across the country have expressed rising frustration about a lack of tests. Without knowing if they have been infected by the virus, they do not know if they should go to work if they have mild symptoms, and put people in their care at risk, or stay at home and strain stretched colleagues further.

Testing has become a flashpoint in the global struggle to contain the Covid-19 outbreak. The World Health Organization has said it is vital for governments to “test, test, test” as widely as possible so infected people can be isolated, along with anyone they have contacted, and so authorities understand the spread of infection.

Read the full story here


US stock futures rally sharply after latest Fed intervention

US stock-index futures swung from deep losses to solid gains after the Federal Reserve said there was no limit to its bond purchase programme.

S&P 500 futures were recently up 2.7 per cent with little more than an hour to go before the opening bell on Wall Street, leaving them up almost 8 per cent from where they were traded ahead of the Fed announcement.

“The Fed throws in the kitchen sink, the bathroom sink, the neighbour’s sink,” said Peter Tchir, strategist at Academy Securities, but added that Washington needs to do more on the fiscal policy front.

Markets fell overnight after the Trump administration and congressional leaders struggled to reach a deal on fiscal stimulus measures worth nearly $2tn to help combat the pandemic.

European stock markets also trimmed their losses, with the Stoxx 600 recently down 2.2 per cent from a fall earlier of more than 4 per cent.

Israel unemployment quadruples since February due to virus

Mehul Srivastava in Jerusalem

Israel’s unemployment figure leaped to nearly 18 percent, more than quadrupling since before coronavirus-related shutdowns sent the economy tumbling, according to figures from the National Insurance Institute broadcast on state radio.

Some 60,000 people applied for unemployment insurance on Sunday, bringing the total new applicants since the end of February to just under 600,000, the institute said. Payouts in March could exceed 1.5bn Israeli Shekels, (approximately $400m).

Before the virus prompted Prime Minister Benjamin Netanyahu to shutter non-essential businesses, especially bars, restaurants and other leisure activities, Israel was hovering near full-employment, with under 4 per cent of the population actively looking for work.

Mr Netanyahu has promised an “extensive and substantial relief package” aimed at protecting businesses by the end of this week, as economists have urged him to abandon fiscal caution. The chairman of the national economic council told state radio that Israel’s economy was heading “towards the valley of death.”

Israel has more than 1,000 confirmed cases of Covid-19, and on Sunday reported its first death — an 88-year-old Holocaust survivor. Officials are mulling more extensive nationwide closures to stem new infections, including the possibility of day-time curfews.


Federal Reserve says there is no limit to its bond buying programme

James Politi and Brendan Greeley in Washington and Colby Smith in New York report:

The Federal Reserve has committed to unlimited purchases of US Treasuries and agency mortgage-backed securities and set up additional lending tools to shore up struggling companies and financial markets.

“The Federal Reserve is committed to using its full range of tools to support households, businesses, and the US economy overall in this challenging time,” the Fed said in a statement on Monday morning.

“While great uncertainty remains, it has become clear that our economy will face severe disruptions. Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate,” it said. 

The Fed had originally planned to purchase at least $500bn in US Treasuries and at least $200bn in agency mortgage-backed securities. In recent days it has ramped up the pace of these purchases, after earlier interventions failed to address strains that had emerged in both debt markets. 

By Friday, it had already completed roughly half of its planned Treasury purchases, as well as about a third for the agency mortgage-backed securities. Following a meeting on Monday of the FOMC, its monetary policy setting committee, the US central bank is no longer putting a numerical cap on its purchases of Treasuries and mortgage-backed securities, but signalling that it is prepared to act as much as necessary. 

The Fed also unveiled two new facilities that allow it to purchase corporate bonds, including new issues. Another facility called TALF- revived from the 2008 financial crisis – gives the Fed the ability to buy securities backed by student, car and credit-card loans, as well as loans to businesses through the Small Business Administration. The Fed also expanded two existing programmes, to ease strains in the markets for municipal debt and the short-term loans known as “commercial paper.” 

The Fed also said it would soon announce a “Main Street Business Lending Programme” to lend directly to small businesses. 

Ford extends production halt to India and South Africa

Peter Campbell, motor industry correspondent, reports:

Ford has suspended production at plants across the world including in India and South Africa, days after halting output in North and South America and Europe.

The carmaker began closing sites in India, South Africa, Thailand and Vietnam on Saturday, it said on Monday.

The outages are expected “to last a number of weeks depending on pandemic situation, national restrictions, supplier constraints and dealer stock requirements”, the company said.

The expansion of its global closures comes days after Ford tapped its $15.4bn credit line and scrapped its long-protected dividend in a bid to preserve cash while its main factories remain shut.

Last week saw hundreds of auto plants close as every major carmaker closed sites in North America and Europe.

Sterling falls 1% against US dollar

Eva Szalay in London

Sterling is suffering heavy losses against both the US dollar and the euro. The pound traded more than 1 per cent lower against both peers to hover at $1.1504 while the euro pushed to 92.72p.

The pound weakened nearly as much as the Australian and New Zealand dollar, which decline when investors are concerned about global growth prospects. Last week sterling fell to below $1.15. Since the beginning of the year, the pound has shed nearly 10 per cent against the euro and 13 per cent against the dollar.

Sterling’s drop comes despite spending promises from the UK chancellor, which Lee Hardman, a currency analyst at MUFG Bank, described as “impressive”.

He noted that while the coordinated response between the UK central bank and the government has been well targeted and large in scale, it will push the budget deficit to around 10 per cent of gross domestic product.

“The UK’s large twin budget and current account deficits leave the pound vulnerable to further weakness during the Covid-19 crisis period,” Mr Hardman said.

Debenhams closes stores in UK and Ireland

Jonathan Eley reports

Debenhams, the UK department store chain, said it would close its UK and Irish stores from the end of Monday.

“We hope to be able to reopen as soon as is practically and safely possible. In the meantime, our customers will continue to be able to shop with us online,” the group said in a brief statement.

The group has around 130 stores in the two countries. Its decision follows that of John Lewis, which announced its 50 stores would close over the weekend.
Kingfisher is keeping its B&Q and Screwfix stores open for now, but the UK government is suggesting that all non-essential stores may soon be ordered to close.

Central bankers call for joint eurozone action on virus

Martin Arnold in Frankfurt

The heads of the French, Italian and Portuguese central banks have called on eurozone finance ministers to launch a coordinated rescue package to provide funding to European countries hit hardest by the coronavirus pandemic.

While they propose slightly different solutions, the central bank bosses are all attempting to raise the pressure for the bloc’s finance ministers to take decisive action on Tuesday when they will discuss joint action to battle the economic fallout of the disease.

François Villeroy de Galhau, Banque de France governor, said he supported “the idea of exceptional European coronavirus loans,” which he told Ouest France newspaper could be provided by the European Stability Mechanism, the EU’s €500bn bailout vehicle.

However, Bank of Portugal boss Carlos Costa said ESM credit lines for virus-hit countries were flawed as they would only inflate national debts. He suggested issuing “coronabonds” to lend money to countries that could be repaid over many years via the EU budget.

“Failure to cooperate in this crisis would permanently scar the European project,” Mr Costa told Reuters, adding that “solutions must be found in order to avoid that the coronavirus emergency becomes a second sovereign debt crisis”.

Diageo is latest drinks maker to join hand sanitiser production rush

Diageo has become the latest spirits maker to pledge to assist the rocketing demand for hand sanitiser, following the likes of Pernod Ricard and LVMH with a pledge to boost global supply.

The maker of Johnnie Walker whisky, Smirnoff vodka and Tanqueray gin said it would provide up to 2m litres of alcohol to sanitiser manufacturers for free as shortages grow amid the worsening coronavirus pandemic.

It follows a similar move by rival Pernod Ricard — maker of Jameson whiskey and Absolut vodka — which will also supply alcohol to producers. A host of other drinks makers, ranging from multinationals to small scale craft distillers — have already pledged to support sanitiser production in various different ways.

Distillers use 96 proof alcohol as the base for drinks such as gin and vodka but as their factories are not equipped to make gels, some are opting to make liquid sprays, while others — like Pernod and Diageo — are seeking to supply ingredients.

Luxury goods group LVMH, which makes Hennessy Cognac and Moet champagne, said last week it would retool production lines in its French perfume factories to produce sanitising gel to be donated to hospitals.

Keir Starmer urges prime minister to extend UK compliance measures

Jim Pickard, chief political correspondent, reports:

Keir Starmer, the frontrunner to become the next Labour party leader, has urged Boris Johnson to implement further compliance measures to bring the UK in line with other European countries battling the spread of coronavirus.

Sir Keir, shadow Brexit secretary, said there was “growing anxiety” about the spread of the disease and the severe pressures on the National Health Service:

Labour has supported the social distancing measures that have been introduced.

However, in these extraordinary times, the government must now set out further compliance measures, such as those introduced in other countries. These are vital days in the battle against the coronavirus.

The intervention adds to the pressure on Boris Johnson to consider further interventions such as closing non-essential shops.

The prime minister used Sunday’s news conference to confirm his refusal to impose a curfew on households, saying that people needed to get outside for mental and physical health. But he did issue a threat to tighten up restrictions if people failed to adhere to the guidance of staying two metres apart.

Iran steps up efforts to identify coronavirus patients

Najmeh Bozorgmehr in Tehran

Iran’s health ministry has accelerated efforts to detect coronavirus patients, which could lead to a rising rate of confirmed cases in coming days.

Iran has capacity to do 6,000 tests a day in 56 laboratories and this will increase to 10,000 tests soon, said ministry official Kianush Jahanpur in a video conference call with reporters on Monday. “We have had a more active search for patients and monitored 36m people which will increase the number of those tested positive in the coming days.”

Dr Jahanpur added that 58,000 people have had tests, 23,049 of whom were confirmed to have the virus, while 1,812 of them died.

The Islamic republic opposes lockdown and curfew and expects the Covid-19 fatalities to reach a peak in the first half of April. Dr Jahanpur reiterated that draconian preventive measures were not an option because they “do not correspond with the country’s economic, management and cultural characteristics” and that there were no guarantees such acts would have a positive outcome.

Local authorities said on Monday that around 8.5m people travelled in 2.8m cars over the past few days to celebrate the Persian new year. Dr Jahanpur said the whole country has been infected and such travel “will definitely have a negative impact on the spread” of the virus.

Iran has allocated 40,000 beds and 2,500 ICU beds in about 165 hospitals for Covid-19 patients. All ICU beds are occupied, he added.

UK’s Coronavirus Act to begin its swift journey into law

Sebastian Payne in London

The UK’s Coronavirus Act begins its parliamentary passage on Monday.

For a 325-page piece of legislation, its journey into law is going to be rapid. It is expected to complete all of its stages in the House of Commons today: the second reading will be completed by 8pm and the committee stage by 10pm.

The act will then go to the House of Lords on Tuesday and Wednesday. Assuming peers do not amend it, it should receive Royal Assent late on Wednesday or early Thursday. Parliament is then expected to go into early recess for the Easter holidays.

The key debate in the Commons on Monday will be about oversight. The Coronavirus Act includes draconian powers for the police – the ability to shut down airports, ports and force individuals into self-isolation for example. The opposition Labour party and some Conservative MPs are concerned about having sweeping powers unchecked possibly up to September 2022.

The government has acknowledged this and has set out its own amendment to the bill, which requires a vote every six months to renew the powers within the Act. Labour party insiders said that, while this compromise is not perfect, it is a “very welcome” step from No 10 and is “much improved” from its previous position.

The other area MPs remain concerned about is the death management provisions within the Act. Cremation by local authorities is an issue for certain religions and Naz Shah, Labour MP for Bradford, is poised to set out an amendment to ensure dignity is maintained with respect to faiths.

There may be debates among MPs on provisions for the special education network and Rishi Sunak’s economic packages to deal with coronavirus disruption. Expect to hear a lot about self-employed workers and if and when the government will act to help them.

Spain records 26 per cent increase in deaths in 24 hours

Daniel Dombey in Madrid

More than 450 people have died in Spain in the past 24 hours after contracting the coronavirus, while there has been a surge in intensive care patients.

The ministry of health said on Monday that 2,172 have died, a 26 per cent increase on Sunday’s total of 1,720. Spain, with more than 33,000 infected, is the worst hit European country after Italy.

Meanwhile 2,355 people are in intensive care, up more than 30 per cent from Sunday, as health services come under strain. Emergency hospitals have been set up, for example at Madrid’s biggest exhibition and conference centre where more than 1,000 beds have been placed.

Fernando Simón, the doctor helping coordinate Spain’s response, said 3,910 medical professionals have been infected. Carmen Calvo, Spain’s deputy prime minister, has been hospitalised for respiratory problems and is being tested for coronavirus.

Spain hopes this week will mark the peak in terms of the rapidity of the spread of the virus but, because of the incubation period, the number of patients in intensive care is likely to increase for a further one to two weeks.

Bank of Ireland to close 40 per cent of branches

Arthur Beesley in Dublin

Bank of Ireland is closing almost 40 per cent of its branches for the duration of the coronavirus pandemic, saying it needs staff to focus on services that are most in demand after a sharp decline in branch footfall.

BofI, Ireland’s second-largest lender by market capitalisation, said it will close 101 of its 262 branches from Tuesday:

Over the past 10 days, the bank has seen a reduction in footfall in branches, predominantly at advice and self-service locations. While at the same time there has been an increase in customers needing a range of other support.

The bank said officials from closed branches will support larger branches and help call centres deal with the “increased volume” of customers seeking help to face Covid-19 disruption, especially for mortgage and business loan payment breaks.

Deutsche Bank to close nearly half of its branches

Olaf Storbeck in Frankfurt

Deutsche Bank will temporarily close 40 per cent of its branches as it reacts to coronavirus spreading across Germany.

From Tuesday 210 of Deutsche’s 500 domestic branches are going to close, Germany’s largest lender said on Monday. It added that it wants to protect employees, clients and business partners as far as possible from infection.

Deutsche Bank said that its aim is to be accessible for all clients across Germany. It will supply all its ATMs with cash and said that clients who need advice can either use other branches or phone.

Deutsche’s move mirrors a similar decision by Munich-based lender HypoVereinsbank, which early last week said that it will close down one in three branches.

Indian doctors say lockdown is keeping crucial staff away

Amy Kazmin in New Delhi

Doctors in Delhi say that the abrupt lockdown in the capital city, including suspension of public transport, is impeding the ability of crucial support staff to get to and from work.

Public transport has been suspended in the city since Sunday, when Prime Minister Narendra Modi asked India’s nearly 1.4bn people to observe a voluntary one-day “people’s curfew”.

As the day was ending, authorities announced a more formal lockdown, in which public transport services networks, including the Delhi Metro and most buses, would be suspended until March 31. Taxis and auto rickshaws have also been prohibited from operating, as have Uber and its local rival Ola.

After a total suspension of services on Sunday, city buses began running again on Monday, but are only operating infrequent skeletal services.

“How are staff supposed to attend the hospital with no public transport,” said one doctor at a 595-bed private hospital in New Delhi. “Hospitals are not run by doctors alone. Doctors all reached because they have their cars. But the electrician couldn’t reach because he didn’t have a scooter. All the staff nurses were calling saying, there is no bus how do we come?”

“Where was the planning for this?” the doctor asked.

Indian stocks plunge as lockdown measures unveiled

Benjamin Parkin in New Delhi

Indian stocks plunged after the government unveiled broad lockdown measures across much of the country to curb the spread of the coronavirus.

The Bombay Stock Exchange’s benchmark Sensex index plummeted 12 per cent on Monday, continuing its fall even after an early sell-off triggered a 45-minute halt to trading.

After a voluntary one-day curfew on Sunday, the government said activity would be restricted to all but essential services across large parts of the country. That applies, with some variations, to the capital New Delhi and financial hub Mumbai, where stock exchanges and many financial groups are located. India has reported 415 cases of Covid-19.

The Sensex, which rallied in the months before the virus started to spread, has fallen 26 per cent over the past month as foreign investors pulled out funds amid a broader flight from emerging markets. That has added to pressure on the Indian rupee, which fell to a record low of 76 against the US dollar on Monday.

Moody’s downgrades outlook for asset managers to negative

Chris Flood reports:

Moody’s, the ratings agency, has downgraded its outlook on global asset managers to negative from stable as a result of the upheaval unleashed by the coronavirus pandemic.

Moody’s warned that the outbreak would strain asset managers’ revenue and cash flow, which are highly correlated to movements in financial market indices and that fund houses’ profits and liquidity would be impaired .

Dean Ungar, senior analyst at Moody’s, said:

Even if central bank and policymaker responses to the coronavirus pandemic mitigate recessionary forces and ease liquidity stress, asset managers will be forced to rapidly adjust their cost structure and conserve liquidity. In the event that public health measures are unable to curtail the pandemic, a deeper more prolonged economic slowdown in the US and Europe will result, and the credit negative implications for asset managers will intensify.

Australia pulls athletes from 2020 Olympics

Murad Ahmed, Sports Correspondent, reports:

Australia is withdrawing its athletes from the Tokyo 2020 Olympics, putting further pressure on games organisers who have begun discussions to postpone the world’s biggest sporting event.

On Monday, the Australian Olympic Committee announced that it could not assemble a team for the games if they went ahead as planned this July, because its athletes were unable to train properly due to lockdown conditions in the country. It became the second nation to withdraw from this summer’s games after Canada.

Over the weekend the International Olympic Committee conceded that a postponement of the games was likely — a sentiment echoed by Shinzo Abe, Japanese Prime Minister, today.

The IOC has given itself a four week deadline to agree the extent of a delay but has added “cancellation was not on the agenda.”

US subprime mortgage specialist seeks buyers for $1bn of assets

Joe Rennison and Robert Smith in London and Eric Platt in New York

A $2.3bn mutual fund sought buyers for more than $1bn of US mortgage bonds on Sunday to cover investor withdrawals after booking heavy losses in the current market turmoil.

The AlphaCentric Income Opportunities fund lost more than 30 per cent of its value last week owing to its heavy exposure to home loans for borrowers with lower credit scores. The fund’s public filings show that at the end of 2019 — when it still had $4bn in assets — it had invested two-thirds of its portfolio in bonds backed by subprime mortgages. 

The mortgage market has come under broad pressure as some investors began to doubt homeowners’ ability to repay their loans. Two traders said that the fund’s portfolio managers sought offers from potential buyers on a list of more than $1bn of securities to raise cash.

The mutual fund, which carries the highest, five-star rating by influential investment research firm Morningstar, offers its investors the chance to withdraw their money on a daily basis. 

A statement from AlphaCentric’s management team said the coronavirus had caused “severe market dislocations and liquidity issues” across the bond market and that they were “moving expeditiously to address the unprecedented market conditions”.

Read more here

Global Covid-19 case count rose by record magnitude over the weekend

Steve Bernard, FT data visualisation journalist, reports:

The global coronavirus count count increased by a record magnitude this weekend as the situation worsened, particularly in the US.

Health authorities reported an additional 61,872 cases over the 48 hour period, according to FT calculations. The number of fatalities increased by 3,260 to 14,748.

The US was the hardest hit on Sunday adding 9,339 cases, nearly 4,000 more than Italy which added 5,560. Italy saw a drop in the number of new cases for the first time in 12 days.

New York State has become the centre of the outbreak in the US, adding 5,190 cases. It now has 16,900 affected by the Covid-19 virus, almost half the nation’s total of 35,060.

The daily number of recoveries saw a slight dip on Sunday with 3,127 more people free from the virus. The total now stands at 99,040.

Coronavirus tracked: the latest figures as the pandemic spreads

French companies scrap financial forecasts

David Keohane in Paris

Some of France’s largest companies are cutting back or scrapping their forecasts for this year as they struggle to deal with or even quantify the impact of the coronavirus.

On Monday morning materials group Saint Gobain and construction group Vinci both discarded their forecasts while state-backed energy giant EDF said it now expected its core earnings for the year to come in at the lower end of the range it had targeted.

Saint Gobain said it would aim for a “greater decrease in capital expenditure than the €200m reduction initially planned for 2020 versus 2019 by deferring all possible projects that were scheduled in the coming months” and that “the guidance for 2020 is no longer valid”.

Vinci said:

Given the uncertainty about the duration and scale of the health crisis, it is not possible to quantify its impact on the group’s financial statements.

However, it appears that VINCI will be unable to meet its target, announced in February, of achieving revenue and earnings growth in 2020.

Oil slides again as demand continues to decline

Oil slipped lower once again this morning as ever-tighter restrictions on global travel continue to sap demand, while an end to the Saudi-Russia price war seems as far away as ever.

Brent crude, the international oil benchmark, fell 5.7 per cent to $25.44, hovering just above the sub-$25 lows it touched late last week following one of its worst one-week slides. West Texas Intermediate, the US marker, was down 1.2 per cent at $22.36.

Countries across Asia clamped down further on people’s movement over the weekend. “Oil has obviously been unable to escape this pressure, with it pretty clear the impact stricter travel restrictions will have on global oil demand,” said analysts at ING.

Meanwhile hopes of a resolution to the price war between Russian and Saudi Arabia were dampened by reports that Russian President Vladimir Putin would not give in to what he views as blackmail. Optimism that US producers might enter into supply constraint agreements in the near-term was also dashed.

Analysts at JBC Energy said that as demand continues to tumble producers may be unable to halt production quick enough so as not to overwhelm global storage capacity. “In such an environment, it is as possible for Brent prices to briefly go to $10 per barrel as it was back in 1986 or 1998,” they said.

Mervyn King speaks up for UK self-employed

Mervyn King, former governor of the Bank of England, joined the chorus of voices calling on the government to borrow whatever is necessary to provide compensation to the self-employed, Jim Pickard writes.

The UK government on Friday announced an unprecedented wage subsidy scheme worth 80 per cent of salary for every worker for the duration of the crisis – but 5m self-employed people were excluded.

Mr King told the Today programme on BBC Radio 4:

It is difficult to come up with short-run practical schemes to do this, the government needs to announce that it will compensate all business and all self-employed for a very large proportion of the incomes which they could reasonably have expected.

We should allow the government a few days to think through the practical ways to implement it.

UK jury trials put on hold and current jurors discharged

Jane Croft reports:

All new jury trials in England and Wales will be halted temporarily amid concerns about the coronavirus.

The Lord Chief Justice said on Monday that he would stop jury trials for a short time to enable appropriate precautions to be put in place in crown court buildings to ensure social distancing. The UK government has urged people to stop all unnecessary contact to prevent the coronavirus from spreading. Crown court trials currently involve 12 jurors sitting in close proximity to each other in a courtroom often with several barristers, solicitors and court staff.

Lord Burnett said:

This morning no new trials are to start. Jurors summoned for this week are being contacted to ask them to remain at home, and contact the court they are due to attend. They will only be asked to come in for trials where specific arrangements to ensure safety have been put in place.

In some cases, this may mean that jurors may be called in to start a new trial later on Monday. All hearings in the Crown Court that can lawfully take place remotely should do so and other hearings not involving a jury should continue if suitable arrangements can be made to ensure distancing.

His updated statement comes after last week’s announcement that only jury trials of three days or less would take place in the crown court due to concerns about Covid-19. Scotland and Northern Ireland, which have separate legal jurisdictions, have already stopped all new jury trials.

Lord Burnett also said he would put in place more arrangements to use telephone, video and other technology for court hearings.

Meanwhile the jury in a high profile murder trial at London’s Old Bailey were discharged on Monday and the case adjourned after a third juror went into self isolation due to coronavirus.

Three teenagers were on trial accused of the murder of police officer Andrew Harper who died after becoming entangled in a tow rope as he tried to apprehend quad bike thieves.

The 12-strong jury hearing the case had already dropped to 10 people due to jurors going into self isolation and on Monday the court heard a third juror was also in self isolation and could not attend court. Trial judge Mr Justice Edis said he was discharging the jury “with a heavy heart” and set a review hearing date in June.

This post has been updated

Uber and rival Ola slash services in major Indian cities

Benjamin Parkin in New Delhi

India’s coronavirus lockdown has prompted Uber and homegrown rival Ola to scale back operations across large parts of the country, including a total halt in the capital New Delhi.

On Sunday India observed a voluntary curfew, which was promptly followed by orders prohibiting all but essential services across much of the country and broad restrictions on transportation links until the end of the month.

As a result, Uber and Softbank-backed Ola have entirely suspended services in New Delhi where the measures have been among the most restrictive. The rideshare operators are continuing at limited levels in other parts of the country. Ola, for example, said it is offering skeletal services in Mumbai.

“Uber is complying with all Central and State Government directives,” the US company said. Ola said: “We will enable a minimal network of vehicles to support essential services in cities, wherever applicable.”

India, which has confirmed 415 cases of Covid-19, also suspended its national rail service along with local trains and metros in cities like Delhi and Mumbai.

UK government weighing further clampdown

George Parker, Political Editor, reports:

Matt Hancock, health secretary, said the government was willing to take more action, including increasing the role of the police, to stop people passing on the virus to others.

“I can understand people wanting to have exercise but they should do it away from others,” Mr Hancock told the BBC Today programme. “We have demonstrated we are willing to take more action.”

Mr Hancock said “nothing was off the table” pointing out that he had recently signed an order allowing the police to close down pubs and restaurants that were unwilling to follow government advice to shut their doors.

It’s the sort of thing we have to be prepared to see if we are to stop this virus.

Mr Hancock denied that Boris Johnson was reluctant to take steps to curtail civil liberties and was dragging his feet in imposing a shutdown of society. “We are doing everything we can to keep people safe,” he said.

ITV pulls guidance as virus halts film production

Patricia Nilsson in London reports:

ITV has withdrawn its market guidance, as the coronavirus outbreak halts its film production business and advertising spend continues to dwindle.

The broadcaster had earlier this month said advertising revenues would drop 10 per cent in April, as travel companies pull back on marketing spend. It had, however, expected ad sales to grow by 2 per cent over the first quarter.

But on Monday the company warned of a deteriorating situation, with “further deferrals in advertising” from companies in other sectors, following the government’s decision to close shops, factories and other businesses that require people to get together.

Carolyn McCall, ITV’s chief executive said, she was navigating the company through “unprecedented and uncertain times, requiring us to take difficult decisions”. She said the company was taking measures to reduce costs and manage its cash flow, adding:

Our absolute priority is to protect our people, while trying to ensure that we deliver the news and programmes our viewers value and love to watch.

ITV said it would scrap its dividend of 5.4p per share this year, saving the company roughly £300m, and withdrew its intention to pay a 8p dividend for 2020.

The company warned that each percentage drop in advertising revenue would hit the company — which in 2019 reported pre-tax profits of £530m — by roughly £17m over the full year. ITV said it would, however, not give guidance on the next two months as “the situation remains dynamic”, instead updating the market again in May.

ITV Studios, the company’s production arm which has had to “pause a significant number of productions in the UK and internationally” made up roughly half of the company’s revenues last year at £1.8bn.

Hong Kong bans arrival of non-residents for a fortnight

Nicolle Liu reports:

Hong Kong will ban the arrival of all non-residents travelling by plane for a fortnight and all connecting flights will be cancelled from Wednesday, in the latest move by a government to tighten borders in an attempt to limit the spread of the coronavirus.

Arrivals from Macau and Taiwan will also have to undergo compulsory quarantine measures like all other foreign arrivals, chief executive Carrie Lam said on Monday after a surge in coronavirus cases in the city driven by imported infections. Nationals from these two regions who have been abroad in the past 14 days will be barred from entering.

Returnees from the UK, the US and Europe will be required to undergo virus testing even if asymptomatic.

The government will also propose legislation to prohibit restaurants and bars from selling alcohol and order all recreational facilities to close, including changing rooms and gyms.

“People in bars often take off their masks, drink and chat, and people get more intimate when they are drunk, increasing the chance of cross-transmission,” said Ms Lam.

The territory reported 39 new confirmed cases on Monday, driving the total number to 357, including a doctor from the department of health working on infection control at Hong Kong airport.

British government tells people not to visit holiday homes

George Parker, Political Editor, reports:

The UK government has told people to stop visiting second homes or other holiday premises, amid concerns that Londoners were leaving the capital to self-isolate in the countryside.

“Essential travel does not include visits to second homes, camp sites, caravan parks or similar, whether for isolation purposes or holidays,” the government said on Sunday night.

People should remain in their primary residence. Not taking these steps puts additional pressure on communities and services that are already at risk.

Council leaders in popular holiday regions of Britain, including Cornwall, have urged people not to travel for fear that the virus — which has a hotspot in London — could be spread more widely across the country.


European markets sustain fresh blow at the open

Major European markets have kicked off the week on a gloomy note as governments around the world have been forced to sharpen measures aimed at staunching the spread of the coronavirus.

In the first few minutes of trade, Europe’s Stoxx 600 was down 3 per cent, with London’s FTSE 100 off 1.7 per cent. France’s CAC 40 and Germany’s Dax both tumbled more than 4 per cent.

Futures tracking Wall Street’s S&P 500 fell around 3.7 per cent, suggesting the index may continue declining after Friday’s 4.3 per cent fall.

In the commodities market, Brent crude, the international oil benchmark, fell 4 per cent to $25.94 a barrel.

Shared-office group IWG scraps dividend and suspends share buybacks

George Hammond, Property Correspondent, reports:

IWG has scrapped its final dividend and suspended a £100m share buyback scheme, as the coronavirus forces the closure of offices around the world and adds to the pressure on co-working operators such as IWG and rival WeWork.

Both the dividend of 4.8p and the share repurchasing had been announced in the company’s full year results on March 3. Since then, shares in IWG, the world’s largest co-working office provider, have fallen more than 55 per cent, from £3.59 to £1.60.

The spread of the coronavirus made it impossible to provide earnings guidance for the remainder of the year, said the company, which also extended the maturity profile of a £950m revolving credit facility to 2025 earlier in the month.

Iranian military to set up 2,000 beds in 48 hours

Najmeh Bozorgmehr in Tehran reports:

Iran’s conventional army will set up 2,000 beds over 48 hours as part of a military exercise to increase its capabilities to battle against the coronavirus and any similar illnesses in the future.

Rear Admiral Habibollah Sayyari said on Monday that this was in line with the guidelines of Iran’s supreme leader, Ayatollah Ali Khamenei, to be prepared for any biological warfare in the future.

Iran’s armed forces, including the elite Revolutionary Guards and the army, have already set up makeshift hospitals in some of the provinces worst-hit by Covid-19. The guards have said they are ready to establish between 2,000 to 5,000 beds only in Tehran, the capital city, if need be in the coming weeks.

Meanwhile, a venue for international exhibitions and other public places in Tehran have been designated for use as quarantine facilities for up to 10,000 coronavirus patients after they are discharged from hospitals.

Iran — with 1,685 deaths from the virus — has appealed for international help and says US sanctions have hampered its ability to deal with the crisis.

European stocks poised for tumble at open

European equities markets were set to face another day of heavy losses after a bleak weekend in which the coronavirus outbreak continued to worsen.

Futures tracking the pan-European Stoxx 600 were down 4 per cent in recent trade, with markets in France, Germany and the UK poised for similar falls.

As of Sunday, more than 330,000 had become infected with Covid-19 with the death toll rising above 14,500.

The situation was particularly dark in Italy and Spain where the number of fatalities rose sharply at the weekend.

UK temporarily suspends rail franchises

Chief political correspondent Jim Pickard writes:

The British government has suspended the rail franchise system in a move that effectively nationalises any losses by railway companies for the next six months.

The Department for Transport announced on Monday morning that it would temporarily suspend normal franchise agreements and transfer all revenue and cost risk to the government for a limited period of at least half a year.

Operators will continue to run services day-to-day for a small management fee, it said.

The government had already agreed with train operators that services would be reduced by half from today because of the slump in passenger numbers due to the coronavirus.

The number of people using the railways has already fallen by 70 per cent, year-on-year, since the pandemic began.

In its new announcement on Monday the DfT said that only key workers should be using the trains during the crisis. “No other passengers should travel,” it said.

All season ticket holders will be able to claim a refund for time unused on their tickets, free of administrative charges.

The government took the decision to intervene in the railways because of the damaging impact of the drop in rail fare revenue on the train companies.

Fuller’s withdraws guidance after government closes pubs

Alice Hancock, Leisure Industries Correspondent, reports:

Fuller’s, the UK-based pub company, has withdrawn its financial forecast and is considering cutting its dividend after the government enforced the closure of all bars, pubs and restaurants on Friday.

In a statement on Monday, the company said that it had a strong cash position but that it would take pre-emptive action to mitigate all costs including delaying capital expenditure. It added that it was “carefully considering” its dividend policy and could not provide guidance as to the financial impact of the virus outbreak.

The company runs almost 400 pubs across London and the south, 89 per cent of which are freehold.

Prior to the government’s decision to close pubs last week, Simon Emeny, chief executive of Fuller’s, told the Financial Times that shutting the pubs would have a significant knock-on impact to staff and ancillary businesses. He said:

Fullers employs around 6,000 people. We sell a lot of food so our suppliers will be in financial difficulty. Contractors responsible for planting, cleaning, refurbishment, they are all going to be under enormous financial difficulty. It’s the wider ecosystem around the hospitality industry.

Many hospitality and pub company owners have said that as well as providing employee support, the government must mandate a moratorium on rent payments if their businesses are to survive beyond the end of this month.

Also on Monday, AG Barr, the producer of IrnBru, said that in line with Financial Conduct Authority guidance it was delaying publication of its full year results and had drawn down the full extent of a £60m revolving credit facility.

Fulham Shore, the owner of Franco Manca and The Real Greek, said it was in the “unhappy position” of having to reduce all costs including property and staff. It added that it would keep a number of its restaurants open for takeaway.

Shell to slash spending and halt share buybacks

Anjli Raval, Senior Energy Correspondent, reports:

Royal Dutch Shell will make billions of dollars in capital and operational spending cuts and will halt its share buyback programme as the energy major takes steps to ensure “financial strength and resilience” in the face of oil market turmoil amid the coronavirus outbreak.

The Anglo-Dutch energy major will cut capital expenditure to $20bn or under this year, from initial plans for $25bn in 2020. It will also reduce operating costs by $3-4bn versus the levels a year ago.

Shell estimates together this will contribute $8-9bn of free cash flow on a pre-tax basis.

Shell will not continue with the next tranche of its share buyback programme for the coming quarter. The company said it still intends to repurchase $25bn of shares, but it will miss the completion target of the end of this year.

While it said it is still ploughing ahead with its $10bn asset sale programme, the timing will depend on “market conditions”.

Ben van Beurden, chief executive, said:

The combination of steeply falling oil demand and rapidly increasing supply may be unique, but Shell has weathered market volatility many times in the past.

Electrolux suspends dividend as demand for consumer appliances falls

Richard Milne, Nordic and Baltic Correspondent

Electrolux became the latest company to suspend its dividend after a sharp drop in demand and production difficulties led the world’s second-largest maker of consumer appliances to conclude the coronavirus outbreak would have a material impact on its finances.

The Swedish group said on Monday morning that it could not yet provide details of the impact, but that it would close factories and lay off workers as needed as well as not pay its dividend for 2019.

“Electrolux has a solid balance sheet, but this is an extraordinary situation and the board believes it is appropriate to take a prudent approach at this point in order to ensure the company continues to be well-positioned for the future,” said chairman Staffan Bohman.

It also withdrew its proposals for a long-term share programme and increased board fees for the annual meeting. But it added that it could call an extraordinary meeting later in the year if market conditions stabilised and its financial position was still solid enough to declare a dividend.

Russia orders elderly to stay at home after rapid rise in cases

Henry Foy in Moscow

Russia said its number of confirmed cases rose to 438 on Monday, as Moscow ordered all its elderly people to remain at home for the next three weeks.

Russia’s numbers are far lower than other major European countries but have spiked over the past week, and more than doubled over the past four days.

Moscow’s mayor and the governor of the wider region surrounding the capital on Monday said all over 65s must remain at home until mid-April.

“I believe that in general we are in control of the situation with coronavirus,” Russia’s prime minister Mikhail Mishustin said at a meeting with senior officials. “But preparation for more serious challenges is necessary.”

Europe: What you might have missed

Stock markets in Asia Pacific dropped on Monday after negotiations over a $2tn package to support the US economy faltered.

Japan’s prime minister Shinzo Abe publicly acknowledged for the first time that this summer’s Olympic Games are likely to be delayed. Read more on the discussions around postponing the games here.

The UK has announced a £20m programme to track changes in the virus that causes Covid-19 to identify mutations as the epidemic continues.

Donald Trump said he had “activated” the National Guard, the reserve forces of the American military, to help the hardest-hit states, including California, New York and Washington, grapple with the coronavirus outbreak.

Shanghai has downgraded the city’s health emergency response to the virus after several weeks without a new local case. The city has now turned its attention to imported cases from overseas.

New Zealand has ordered citizens to begin self-isolating at home, as well as the closure of all non-essential services within 48 hours, as the number of coronavirus cases in the country jumped to above 100.

In the Philippines, President Rodrigo Duterte is seeking sweeping new executive and spending powers in response to the Covid-19 pandemic.

Coronavirus cases in Turkey rise to 1,236

Laura Pitel reports from Ankara

Turkey exceeded 1,200 coronavirus cases as the outbreak in the country claimed nine more lives.

The nation’s health minister, Fahrettin Koca, announced on Sunday night that a total of 1,236 people had been diagnosed with the virus. He said that nine more elderly people had died, bringing the death toll to 30.

The pace of the increase in cases in Turkey slowed over the weekend after a period when both case numbers and deaths were growing by at least 80 per cent each day.

Sunday’s figures represent a 31 per cent increase in case numbers and a 43 per cent increase in deaths compared with the previous day.


Airbus announces €15bn credit facility in response to virus

Thomas Hale reports from Hong Kong

Airbus announced a new €15bn credit facility on Monday, seeking to strengthen its access to liquidity in response to the pandemic’s impact on the global aerospace industry.

The European aircraft manufacturer also said it would withdraw its 2019 dividend proposal, which had an overall cash value of around €1.4bn, as part of measures to “protect the future of the company”.

“We have withdrawn our 2020 guidance due to the volatility of the situation. At the same time, we are committed to securing the liquidity of the Company at all times through a prudent balance sheet policy. I am convinced that Airbus and the broader aerospace sector will overcome this critical period,” said Airbus chief executive Guillaume Faury.

Airbus now has available liquidity of €30bn, the company said on Monday, including financial assets of €12bn.

UAE calls on residents to stay at home

Simeon Kerr reports from Dubai

The United Arab Emirates has called on the public to stay at home as the Gulf state suspends passenger flights from March 25 to mitigate the spread of coronavirus.

All inbound and outbound passenger flights, including transit, will be suspended for a renewable period of two weeks, except for cargo and emergency evacuation flights.

From Wednesday, the country will close malls and food markets, except for supermarkets, pharmacies and groceries, for two weeks. Restaurants must limit their services to home deliveries.

The authorities late on Sunday also advised people not to go out unless they need to buy essential items such as food or medicine, or carry out essential work. People should limit social contact and avoid crowded places “to ensure safety and wellbeing”.

They advised residents to use social distancing protocols. People should use family vehicles with no more than three individuals in each car. Only those in a critical condition should visit hospitals.

Violators will be punished with fines and jail terms, the authorities added.

Further instructions will be given regarding the use of public transport and taxis.

Asia-Pacific stocks drop after US stimulus deal falters

Hudson Lockett reports from Hong Kong

Asia-Pacific stocks fell as negotiations over a $2tn package to support the US economy during the coronavirus outbreak faltered, kicking off what could be another volatile week for global markets.

US senators’ failure to quickly advance legislation through Congress that could help the world’s biggest economy weather the effects of the pandemic dashed investors’ hopes as the spread of the coronavirus shows few signs of slowing down.

On Monday, Australia’s S&P/ASX 200 index fell 4.1 per cent and South Korea’s Kospi skidded 3.6 per cent. China’s CSI 300 index dropped 1.9 per cent while Hong Kong’s Hang Seng slipped 3.8 per cent.

Futures markets pointed to more losses when Wall Street opens on Monday, with S&P 500 contracts sliding 3.9 per cent. Coronavirus cases in the US have reached almost 30,000, with New York state the worst hit.

US dollar strength, a side effect of investors and companies liquidating positions and hoarding cash, was again visible. The South Korean won fell 2 per cent to Won1,279.10 per dollar while the Australian dollar slid 0.8 per cent to $0.5754, down 18 per cent this year.

Sovereign bond prices rose, pushing down yields. The 10-year US Treasury yield dropped 4 basis points to 0.809 per cent. The yield on the equivalent Australian government bond dipped 23 basis points to 0.877 per cent after the central bank said it would buy up to another A$4bn (US$2.3bn) of government debt.

Duterte seeks sweeping new powers to combat fallout from virus

John Reed reports from Bangkok

Philippine president Rodrigo Duterte is seeking sweeping new executive and spending powers in response to the Covid-19 pandemic.

A bill declaring a national emergency and authorising Mr Duterte to “exercise powers necessary and proper to carry out the declared national policy” was filed in the Senate by two pro-Duterte senators, Vincente “Tito” Sotto III and Pia Cayetano, on Monday.

The proposed powers include the right to procure medical and protective equipment, allocate funds, take action to stop hoarding, regulate and limit transport, and “require businesses to prioritise and accept contracts”, according to a draft published in local media.

Mr Sotto denied that the bill would give the Philippine president “emergency powers” and said that Congress would retain oversight over his actions.

The Philippines has reported 380 coronavirus cases to date, and 25 deaths. Mr Duterte last week declared a nationwide “state of calamity” and a lockdown in greater Manila and on Luzon island.

Emirates to continue passenger flights to 13 destinations

Simeon Kerr reports from Dubai

Dubai’s Emirates Airline is cutting its route network to 13 destinations, after earlier saying it would temporarily suspend all passenger operations.

The government-owned airline said that in this “dynamic” situation amid lower demand and border closures it would maintain flights to the UK, Switzerland, Hong Kong, Thailand, Malaysia, the Philippines, Japan, Singapore, South Korea, Australia, South Africa, the US and Canada.

The airline has also introduced cost-cutting measures, including pay cuts, so it can “survive through a prolonged period of reduced flight schedules”.

The airline, which has a strong cash position, is maintaining its cargo operations.

Shanghai downgrades health emergency response on falling cases

Wang Xueqiao reports from Shanghai

Shanghai today downgraded the city’s public health emergency response to the virus, after several weeks without a new domestic case.

The change means that provincial rather than state level departments will be primarily responsible for responding to the epidemic. There have been no local confirmed Covid-19 cases in Shanghai since March 3.

The city is now focusing on preventing imported cases from overseas. It has so far reported a total of 66 confirmed imported cases and 18 suspected cases as of midnight on Sunday.

The office of the Municipal Epidemic Prevention and Control Leading Group said the city was further strengthening prevention measures around ports. These include quarantine measures for all inbound flights, inspection of health declaration cards and temperature checks for all inbound passengers. People who come to Shanghai from or through key countries or regions are to be quarantined for 14 days.

Singapore Airlines cuts 96% of capacity

Stefania Palma reports from Singapore

Singapore Airlines will cut 96 per cent of its capacity to the end of April as border controls tighten across the world to curb the spread of coronavirus.

The airline will ground 138 Singapore Airlines and SilkAir aircraft out of a total of 147 as well as 47 of its 49-strong fleet for low-cost unit Scoot, in what it called “the greatest challenge that the SIA Group has faced in its existence”.

The group said it is taking steps to increase liquidity and cut back capital expenditure and operating costs as passenger revenues have dropped significantly. The company has drawn on its credit lines over the past few days to meet immediate cash flow needs and will be discussing further funding requirements with financial institutions.

Shares in the airline were down 8.8 per cent in morning trading.

Other measures include asking manufacturers to postpone upcoming aircraft deliveries as well as cutting management’s salaries and setting up a voluntary unpaid leave scheme.

Singapore Airlines said it is unclear when it will resume normal services given the uncertainty over when border controls will be lifted.

New Zealand orders citizens to begin self-isolating at home

Jamie Smyth reports from Sydney

New Zealand has ordered people to begin self-isolating at home and will shut down all non-essential services within 48 hours, over fears tens of thousands of people will die unless stricter measures are introduced.

Jacinda Ardern, New Zealand’s prime minister, said schools would close on Tuesday for everyone, except the children of essential workers. All bars, restaurants, cafes, gyms, cinemas, pools, museums, libraries and playgrounds must also close for at least four weeks, she said.

“Staying at home is essential. It’s a simple but highly effective way to constrain the virus – it denies it places to go, and will help give our healthcare system a fighting chance,” said Ms Ardern.

Supermarkets, doctors, pharmacies, service stations and access to essential banking services will remain open.

The escalation of social distancing measures comes as New Zealand reported 36 new coronavirus cases on Monday, which brings the total number of cases to 102.
Ms Ardern said health experts now considered there is now likely transmission within the community with two cases unable to be traced to people travelling from overseas.

South Korean government to take legal action against churches

Song Jung-a reports from Seoul

South Korea’s prime minister Chung Sye-kyun said on Monday that the government will take legal action against several Protestant churches for pressing ahead with Sunday services and violating the government’s guidelines for stricter social distancing.

The move comes as the country continued to report new coronavirus cases, albeit at a slower rate. South Korea on Monday reported 64 new cases, the lowest in about a month, bringing the total to 8,961, according to the Korea Centers for Disease Control and Prevention. Seven more deaths were reported, increasing the death toll to 111.

Some churches, including Sarang Jeil Church in northern Seoul, led by a jailed conservative pastor, continued to hold weekend religious services without abiding by guidelines, despite fears of clusters of infections.

Mr Chung said stern measures should be taken to punish those churches, including banning such gatherings. “The churches’ act seriously hurt the safety of not only individuals attending the service but also communities,” he told a pan-government meeting to discuss Covid-19 measures. “Now is an emergency situation that amounts to a quasi-wartime situation.”

Mr Chung on Sunday called for religious, indoor sports and entertainment facilities to close for the next 15 days, saying the next two weeks will be a “critical” time to contain the virus.

China reports 39 imported coronavirus cases

Chinese health authorities reported no new coronavirus cases in the mainland for the fourth consecutive day. There were 39 imported cases in Beijing, Shanghai and seven other cities or provinces to the end of Sunday. The country has now recorded 81,903 coronavirus cases.

Classified China government data reported over the weekend recorded a further 43,000 cases where people were found to be infected with the virus but did not show any symptoms. These people were not included in the official tally.

There were nine new deaths linked to the virus, taking the total to 3,270.

Mexico warns of rising coronavirus cases

Jude Webber reports from Mexico City

Mexico reported a leap in confirmed coronavirus cases to 316, with 793 suspected cases as authorities warned against a tide of “fake news” and urged people to stick to official advice about the pandemic.

Ricardo Cortés Alcalá, director-general of health promotion at the health ministry, told a news conference that “the trend is definitely going to rise, there’s no other way” but said the government hoped that social distancing measures due to take effect on Monday would flatten the curve.

The social distancing campaign, during which schools will be closed, stops short of ordering people to stay at home, as is the case in neighbouring countries. “We are not in a state of siege … We think people are responsible enough to mitigate this,” he added.

Mexico City’s mayor Claudia Sheinbaum earlier announced that all museums, gyms, cinemas, theatres, zoos and sporting events would be closed and churches would be shut or would be barred from holding large-scale events. “We are appealing for all public and private events not to be more than 50 people,” she said.

The Basilica of Guadalupe, the shrine to Mexico’s patron saint, closed its doors for the first time in its history on Sunday as mass was said to an empty church and transmitted via the internet. The church had not closed during the H1N1 epidemic in 2009.

President Andrés Manuel López Obrador, who spent the weekend holding events and supervising infrastructure projects in the southern state of Oaxaca, has been criticised for appearing too relaxed. He argues he must remain calm and says Mexico is prepared but is still in the first stage of the epidemic.

Japan’s Shinzo Abe says Olympics might be postponed

Kana Inagaki reports from Tokyo

Prime minister Shinzo Abe has publicly acknowledged for the first time that a delay to this summer’s Olympics was likely following mounting global pressure due to the spreading coronavirus outbreak.

“The IOC’s decision is in line with my policy to carry out [the event] in a ‘complete form’, and if that is difficult, we may need to make a decision to postpone, putting priority on the athletes,” Mr Abe said at a parliamentary session on Monday.

The comments came a day after the International Olympic Committee gave its first indication of a postponement to the world’s biggest sporting event, giving itself four weeks to reach a formal decision.

The IOC said that it would need the “full commitment and co-operation” of Japanese authorities, sports bodies, broadcasters and sponsors, and that “cancellation was not on the agenda”.

In line with IOC’s comment, Mr Abe and Yuriko Koike, the governor of Tokyo, emphasised that “cancellation was not an option”.

Australian stocks fall sharply as shutdown takes hold

Jamie Smyth reports from Sydney

Australia’s share market dived 8 per cent in early trading on Monday, as state governments began shutting down large parts of the national economy and US lawmakers failed to agree coronavirus stimulus measures.

Banks, commodities, retailers and leisure stocks all fell sharply as the New South Wales and Victorian governments ordered pubs, clubs, casinos, gyms and other leisure facilities to close from noon on Monday.

The partial shutdown of non-essential services came as the number of coronavirus cases in Australia hit 1,316, continuing to double every three to four days.

The stock market rout occurred as large queues began forming outside welfare offices, as laid off workers sought to make claims for emergency payments made available by Australia’s government.

Lawmakers today began a one-day parliamentary sitting in Canberra to legislate a A$189bn stimulus package aimed at helping businesses and workers survive months of disruption caused by the spread of the virus.

Chris Weston, head of research at Pepperstone group, a financial broker, said the Australian market was being driven down by a combination of the partial shutdown at home and a failure by the US Congress to pass emergency stimulus measures.

“It was already troubled, but market confidence has been dealt a further blow by the sheer inability for Congress to learn from TARP and get things passed with the urgency this absolutely needs,” he said.

Miner Vale sources 5m coronavirus tests for Brazil

Andres Schipani reports from São Paulo

Vale, the Brazilian miner grappling with the fallout from a deadly dam burst, said on Sunday it is bringing 5m coronavirus tests from China as the number of cases grow rapidly in Latin America’s largest country.

The 15-minute rapid test kits bought by the world’s largest iron producer will arrive between next week and mid-April. The kits would amount to half the 10m tests the Brazilian government has said it would distribute as health officials expect the virus to continue spreading fast.

Health minister Luiz Henrique Mandetta warned that Brazil’s health system faces a “collapse” at the end of April.

“We are using our logistics network in Asia to bring supplies to Brazil,” Eduardo Bartolomeo, Vale’s chief executive, said in a note. “Vale and China have a long-term partnership, developed over more than 40 years.”

The announcement came in a critical week for Brazil as the number of cases of Covid-19 surpassed 1,500, the highest in Latin America, while Eduardo Bolsonaro, the president’s third son and a powerful congressman, offended the Chinese government sparking a diplomatic spat by blaming the coronavirus on the country.

Santos delays $4.7bn Australian gas project

Jamie Smyth reports from Sydney

Santos, an oil and gas producer, has delayed development of a $4.7bn gas project off the north coast of Australia and will slash capital expenditure by $550m this year in response to the collapse of oil prices.

The company said on Monday it would defer a final investment decision on its Barossa gas field in waters off the coast of Northern Territory until market conditions improve. The move is part of a strategy to reduce the company’s cash flow breakeven rate from $28 to $25 a barrel of oil and strengthen its balance sheet.

“The current environment is a time for discipline,” said Kevin Gallagher, Santos chief executive. “Given the uncertain economic environment of Covid-19 combined with the lower oil price, we expect to defer final investment decision on Barossa until business conditions improve.”

Santos said it would cut capital expenditure costs in 2020 by $550m, a drop of 38 per cent on previous forecasts. It would also reduce production costs by $50m in 2020 and target a free cash flow breakeven oil price of $25 a barrel.

Santos is the second Australian oil and gas producer to announce big cuts to spending. Last week Oil Search cut capital expenditure by 40 per cent to $440m-$530m in 2020. Woodside is still hoping to make a final investment decision on its $11bn Scarborough liquefied natural gas project later this year, although analysts warn the collapse in oil prices has put this timeline in jeopardy.

Asia-Pacific stocks slip and US futures tumble

Asia-Pacific equities fell and US stock futures tumbled as governments placed further controls on the movement of people in a bid to stall the spread of coronavirus.

Australia’s S&P/ASX 200 shed 5.9 per cent after the government called for the closure of pubs and cinemas and the prime minister warned of possible further measures to stop people gathering. South Korea’s Kospi slid 6 per cent while in Japan, the Topix swung between small gains and losses.

The number of coronavirus cases in the US surged to almost 30,000, with New York emerging as an international hotspot for the virus. State governor Andrew Cuomo told residents to prepare for disruption of between 4 and 9 months.

Futures for the S&P 500 hit limit down, falling 5 per cent before easing slightly to be 3.8 lower. Oil prices also slid with Brent crude, the international benchmark, dropping 6.9 per cent to $25.11 a barrel.

UK to launch £20m programme to track Covid-19 genetic changes

Clive Cookson in London

The UK is launching a £20m research programme to track genetic changes in the Covid-19 virus. The project will read the whole genome of the virus — its full genetic code — from patient samples to track mutations as the epidemic proceeds. The Covid-19 Genomics UK Consortium will carry out genome sequencing at a dozen labs around the country, with the Wellcome Sanger Centre near Cambridge leading the initiative.

“Rapid genome sequencing of Covid-19 will give us unparalleled insights into the spread, distribution and scale of the epidemic in the UK,” said Jeremy Farrar, director of the Wellcome Trust, the medical research charity that is playing a key role in the initiative.

“The power of 21st century science to combat this pandemic is something that those going before us could not have dreamt of, and it is incumbent on us to do everything we can to first understand, and then limit, the impact of Covid-19,” he added.

Genome sequencing is one of three methods for tracking Covid-19, alongside testing patients for the presence of the virus and for antibodies that indicate past infection.

Results from the UK will be fed into an international collaboration called Nextstrain that analyses the global pandemic. The Nextstrain database already contains about 900 Covid-19 genomes from around the world, 10 per cent of them from the UK.

This surveillance is showing the inevitable emergence of what some are calling different viral “strains”. But Covid-19 is genetically more stable than flu, with no significant changes detected so far that might make it significantly more virulent or transmissible.

Saudi Arabia imposes curfew to halt spread of coronavirus

Ahmed Al Omran in Riyadh

Saudi Arabia announced that it would start imposing a curfew between 7pm and 6am for a period of 21 days starting Monday to limit the spread of the coronavirus.

King Salman, who last week said the kingdom was going through a “difficult phase” in combating the virus, ordered the interior ministry to enforce the curfew. Essential services such as healthcare and branches of the military are exempted.

“Protecting public health has become one of the most important duties for the citizens and residents of this country,” a statement carried by the state news agency read. “They must fulfil their duty by staying in their homes, and not to expose themselves and their country to the risk of this pandemic.”

Saudi Arabia reported 119 new cases of Covid-19 on Sunday, bringing the total number of cases in the kingdom to 511, but it has not reported any deaths from the virus so far.

Trump activates National Guard in hardest-hit states

James Politi in Washington

Donald Trump said he had “activated” the National Guard, the reserve forces of the American military, to help the hardest-hit states, including California, New York and Washington, grapple with the coronavirus outbreak.

At a press briefing on Sunday evening, Mr Trump said the reservists would “carry out approved missions to stop the virus” while the governors of the three states would “remain in command”.

The decision comes as the US president has faced growing pressure to more forcefully assist the areas of the country that have been hardest hit by the pandemic, which has left more than 340 people dead in the US and more than 30,000 people ill. The Trump administration has also ramped up its supply of medical equipment and would help set up “federal medical stations” to help healthcare systems in the hardest-hit parts of the country which are already facing shortages and trouble coping with the inflow of patients.

Mr Trump expressed hope that Republicans and Democrats could still agree on a stimulus plan despite some disagreements over the terms of the $2tn package on Capitol Hill, saying he did not think they had “any choice” but to strike a deal. “Our goal is to get relief to Americans as quickly as possible,” he said.

Mr Trump said the administration and lawmakers were considering whether to allow members of Congress to vote remotely, given that three had tested positive for coronavirus and others are in self-isolation due to possible exposure to the disease.

New Zealand’s central bank launches NZ$30bn in quantitative easing

Jamie Smyth in Sydney

New Zealand’s central bank has announced a NZ$30bn (US$16.8bn) quantitative easing programme to tackle a rise in interest rates on government bonds and higher funding costs for the nation’s banks.

Adrian Orr, Reserve Bank of New Zealand governor, said on Monday the negative implications of the coronavirus outbreak had continued to intensify and further monetary stimulus is needed to keep interest rates on government bonds low. The quantitative easing programme will purchase up to NZ$30bn in government bonds, across a range of maturities in the secondary market over the next 12 months, he said.

“The programme aims to provide further support to the economy, build confidence, and keep interest rates on government bonds low,” said Mr Orr.

Mr Orr warned financial conditions had tightened unnecessarily over the past week, reducing the impact of the low official cash rate of 0.25 per cent on achieving the bank’s mandate. Heightened risk aversion has caused a rise in interest rates on long-term New Zealand government bonds and the cost of bank funding.

The launch of quantitative easing in New Zealand follows its government’s launch of a NZ$12bn stimulus package — equivalent to 4 per cent of its economy — last week. Australia’s central bank launched a quantitative easing programme last week, which is also aimed at boosting the economy.

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