Coronavirus latest: French jobless count soared by nearly a quarter in April

New York will allow stores to bar customers not wearing masks

Joshua Chaffin

New York store owners will be authorised to bar entry to those not wearing masks or face coverings, Governor Andrew Cuomo announced on Thursday.

“You don’t want to wear a mask? Fine. But you don’t have a right to go into that store if the store owner doesn’t want you to,” Mr Cuomo said.

The governor unveiled the new executive order as he announced plans to redouble efforts to contain coronavirus in a cluster of low-income, mostly minority neighbourhoods where — in some cases — the infection rate is more than twice that of the 20 per cent recorded in the city as a whole. Among those areas is Morrisania in the Bronx, which is 80 per cent black, and whose infection rate stands at 43 per cent; and the Flatbush section of Brooklyn, where the infection rate is 45 per cent.

“If you look at New York City, there are very different stories within the city,” the governor said, as he pledged to bring more resources to those neighbourhoods to not only test for the virus but also to address underlying health issues that made residents more vulnerable.

Addressing the virus in those areas is vital to the larger effort of reopening New York City, the last of the state’s 10 economic regions that remains shuttered. In order to reopen, the city must also recruit and deploy more tracers to help track new infections.

Mr Cuomo was flanked by the comedian Chris Rock and the actress Rosie Perez, two proud Brooklynites, to help spread his message about the importance of wearing masks and practicing social distancing. “I thought I lived in a country. I thought I lived in the United States. Now I realise we have 50 countries,” Mr Rock said, referring to the confusing and often contradictory approaches being pursued by various states in the pandemic. He also lamented that a matter of public health had become so politicised, saying: “It’s a status symbol almost to not wear a mask.”

Boris Johnson says he considers the Dominic Cummings matter “closed”

George Parker in London

Boris Johnson has refused to criticise Dominic Cummings, his chief adviser, over his day trip during the coronavirus lockdown, saying he considered the matter “closed”.

Mr Johnson, speaking at the Downing St press conference, refused to comment on Durham Police’s statement that Mr Cummings 60-mile round trip to Barnard Castle might have constituted a breach of the lockdown. The police said that no further action was being taken.

The prime minister said that Chris Whitty, chief medical officer for England, and Sir Patrick Vallance, chief scientific adviser, would not give their views on what was “fundamentally a political argument”.

Prof Whitty and Sir Patrick later said they did not want to get dragged into the political arena, in spite of repeated questions from journalists about whether they agreed with Mr Cummings’ behaviour during the lockdown.

Amazon to offer full-time jobs to 70% of those it hired during crisis

Dave Lee in San Francisco

Amazon will offer full-time jobs to 125,000 — 70 per cent — of the 175,000 extra workers it brought on to handle the coronavirus crisis.

From June, staff who choose to stay on will see their pay reduced to $15 an hour, down from the $17-an-hour emergency rate Amazon put in place for all of its logistics employees in mid-March. Other benefits, such as unlimited unpaid leave, have also now come to an end.

Workers, activists and politicians are still expressing concern about working conditions at Amazon’s facilities, as the company continues to refuse calls to provide more detail over how many employees have contracted, and been killed by, the virus.

At its annual meeting on Wednesday, chief executive Jeff Bezos dismissed claims from some shareholders that the company should be doing more.

“We’ve done a good job on contact tracing [and] isolating people,” he said. “And we’re in the process of building our own testing laboratories, so that we can test our frontline people.”

Amazon expects to spend as much as $4bn on coronavirus-related measures in this current period, raising the possibility the company could record its first quarterly loss since 2015.

Singapore could loosen some restrictions if infection rates stay low

Stefania Palma in Singapore

Singapore could loosen some restrictions earlier than anticipated if infection rates remain low, as the city state gears up to reopen parts of the economy next week.

Select businesses and schools will gradually reopen starting from June 2, after which authorities expect 75 per cent of the economy to resume operations. Companies in sectors such as finance, insurance and logistics that meet safety and distancing requirements may reopen next month.

If the infection rate — excluding daily case numbers in foreign worker dormitories, which are in the triple digits but remain contained in these quarters — stays low in the first half of June, further reopening could materialise before the end of next month. Authorities had originally estimated this would happen in early July, at the earliest.

This second step would include the resumption of activities such as dine-in services, sports and public facilities as well as retail shops that meet safety requirements. Social gatherings of up to five people would also be allowed.

“We expect almost the entire economy to reopen by the start of phase two,” said Lawrence Wong, national development minister and co-chair of the coronavirus task force.

Discussions to resume essential travel with countries deemed low risk are also progressing, Mr Wong said. Testing travellers upon departure and arrival would be mandatory for this to occur. “Having these arrangements does not mean we will allow mass market travel,” Mr Wong cautioned.

Singapore on Thursday reported 373 new cases, 372 of which were linked to foreign worker dormitories. The city state counts 33,249 cases after ramping up testing in these structures.

Boris Johnson says England’s lockdown will ease further on Monday

George Parker and Laura Hughes in London

Boris Johnson has announced a significant easing of lockdown rules, saying that from Monday groups of up to six people will be able to meet outdoors, including in private gardens.

The prime minister said that all five of the government’s tests for easing the lockdown had now been met.

Speaking at the daily Downing Street briefing, Mr Johnson said: “I cannot and will not throw away all the gains we’ve made together and so the changes we’re making are limited and cautious.”

Apart from easing social restrictions, Mr Johnson confirmed that outdoor retail and car showrooms could start to reopen from Monday, with other non-essential retailers allowed to open their doors from June 15, with social distancing measures in place.

Primary schools would start to reopen from Monday, with pupils in Year 10 and Year 12 returning to school for “face time” with teachers from June 15.

Mr Johnson said the governments in Scotland, Wales, and Northern Ireland were “quite properly moving at different speeds” on changing lockdown measures.

The five tests include a requirement that the National Health Service should have enough virus testing capacity and personal protective equipment, and the ability to cope with any return of the disease.

Patrick Vallance, chief scientific adviser, warned that the rate of infection — the so-called R number — was still close to one, where each person with coronavirus infects one person on average.

He said that the average R was between 0.7 and 0.9 and that it was vital that caution was exercised . He said numbers were “not coming down fast and the number remains close to 1”.

France further eases coronavirus lockdown

Victor Mallet in Paris

France will relax travel restrictions inside the country and allow schools, cafés and restaurants to reopen from next week after successfully slowing the spread of the coronavirus pandemic, prime minister Édouard Philippe announced on Thursday.

“Freedom will once again become the rule, and restrictions will become the exception,” he said. “On the health front the news is good, but not so good that everything can go back to normal.”

The speech marks the second stage of “deconfinement” after the easing on May 11 of a severe, two-month-long nationwide lockdown.

More than 28,500 people have died of Covid-19 infections in France since the start of March, and about 1,500 patients remain in intensive care, but the number of hospital admissions for the disease has slowed to a trickle after new infections and deaths peaked in April two weeks after the lockdown began.

Now the government under President Emmanuel Macron is eager to restart the economy to limit permanent damage to the country’s industries and the tourism sector. Economic activity fell by a third at the start of the lockdown, and officials are forecasting that gross domestic product will shrink by at least 8 per cent in 2020, the worst depression since the second world war.

Premier League to resume matches on June 17

Murad Ahmed in London

The Premier League has agreed to restart its season next month during a meeting of 20 clubs of English football’s top tier on Thursday, according to two people with knowledge of the decision.

Following the suspension of fixtures due to the coronavirus pandemic, matches are set to resume on June 17, starting with games between Aston Villa and Sheffield United, and Manchester City and Arsenal. All teams would then be involved in a full round of fixtures the following weekend. However, the decision still requires government approval.

Richard Masters, Premier League chief executive, has previously said clubs in the world’s most valuable domestic football competition face more than £1bn in losses if the remaining 92 matches of this season do not take place, due to lost income from ticketing, broadcasting rights and sponsorship contracts.

The Premier League did not immediately respond to requests for comment.

Moody’s cut British Airways’ parent IAG to junk

Moody’s has downgraded British Airways’ parent company IAG’s debt to junk status citing the worsening impact of Covid-19 on air travel.

The agency assigned the company a Ba1 rating, one notch below investment grade, with a negative outlook reflecting possible further downgrades. S&P last week cut the group to BB, placing it two notches inside junk territory. Fitch moved British Airways to junk status in April.

BA late last month moved to cut 12,000 jobs, 30 per cent of its workforce, as it warned that air travel demand might take “several years” to recover. The cuts came before the UK government announced plans to impose a 14-day quarantine on almost all passengers arriving from abroad. IAG chief executive Willie Walsh said that if the restrictions go into force, “I wouldn’t expect us to be doing any flying in that situation, or very little flying”.

In addition to cutting costs, the group — which also owns Iberia, Vueling and Aer Lingus — has raised £300m from the UK’s Coronavirus Corporate Financing Facility and €1bn from Spain’s Instituto de Crédito Oficial facility to boost its liquidity.

Moody’s said that “despite current substantial liquidity” further outbreaks or travel restrictions could add to the financial pressure on IAG. The agency said its decision reflects:

The likelihood that the company will incur substantially increased debt during the coronavirus pandemic, and faces challenges to recover its balance sheet in the next two to three years

French jobless total rose by almost a quarter in April

Martin Arnold in Frankfurt

The number of jobless people in France surged by a record 23 per cent in April as the pandemic caused many companies in the country to stop hiring people on temporary contracts.

The French labour ministry said the number of people classed as category A job-seekers, who are defined as full-time unemployed, rose by 843,000 to reach 4.57m in April.

Three-quarters of the increase came from people switching from other job-seeker categories, many of whom had short-term contracts and could not find a new position.

The ministry said the record monthly jobless increase “was foreseeable because April is the first month entirely marked by confinement” which “led to non-renewals of temporary assignments or short-term contracts, as well as a drop in hiring on short-term contracts”.

“Unemployment therefore increases because companies, in the current context, no longer hire, but not because they do massive lay-offs,” it said. The rise in jobless numbers is unlikely to translate into an equivalent rise in France’s official unemployment figures, which are calculated differently and fell in the first quarter as many people stopped looking for work.

The French jobless figures were released as Europe’s pandemic-stricken economy showed faint signs of recovery, with business and consumer confidence rebounding from near-record lows in May, according to the European Commission’s monthly survey.

Two in three Covid-19 cases are asymptomatic — ONS survey

Clive Cookson in London

More than two in three of people who test positive for Covid-19 in the general community never experience any symptoms of disease, according to the latest weekly infection survey by the UK Office for National Statistics.

“The level of asymptomatic infection — about 70 per cent — seems high but it is consistent with data from other places such as South Korea,” said Professor Sarah Walker of Oxford university, the project’s academic partner. She was confident that the finding was genuine and not the result of false positives in the testing.

Conversely, the study of 19,000 people in 8,800 English households found that only 6.7 per cent of those reporting Covid-19 symptoms on the day of testing — including cough, fever or the loss of taste or smell — actually tested positive for Sars-CoV-2, the virus responsible for the disease.

The survey by ONS and Oxford of people outside hospitals, care homes or other institutional settings also found that 6.8 per cent of people had antibodies to the virus, denoting past infection, which is consistent with levels elsewhere in western Europe.

The overall infection rate in the community was 0.24 per cent, equating to about 133,000 people, down very slightly from 0.25 per cent last week and 0.27 per cent when the study was launched two weeks ago.

Poland cuts interest rates to near zero

James Shotter in Warsaw

Poland’s central bank has cut its benchmark interest rate for the third time in as many months as it battles to contain the economic fallout from the coronavirus pandemic.

The National Bank of Poland said on Thursday that it had lowered its reference rate from 0.5 per cent to 0.1 per cent, a record low. It has now cut the rate by 140 basis points since the onset of the crisis.

Poland has been less badly affected by the pandemic than countries in western and southern Europe, with 22,600 cases and 1,030 deaths so far from Covid-19.

But the country introduced a wide-ranging lockdown to slow the spread of the virus and is still expected to tip into recession, with GDP forecast to decline 4.3 per cent this year, according to the EU.

Live Q&A: The US government and business response to Covid-19

The FT’s Laura Noonan, Demetri Sevastopulo and Andrew Edgecliffe-Johnson have been following the debate among business and political leaders in the US about how to respond to Covid-19.

Throughout the day, they will be answering your questions about how the private and public sector are thinking about the coronavirus crisis and recovery efforts.

Demetri is the FT’s Washington bureau chief and will be able to answer questions about the policy plans being shaped on Pennsylvania Avenue and Capitol Hill. Andrew, US business editor, can take questions about how business leaders are reacting to policy decisions, and their role in shaping the conversations. Laura, US banking editor, will be able to share insight on Wall Street’s response to the pandemic and the Paycheck Protection Program.

Join the Live Q&A here.

Wall Street rally slows as US-China friction worries investors

Harry Dempsey in London

Wall Street opened higher despite escalating tension between Beijing and Washington and news of an additional 2m Americans applying for unemployment benefits last week.

The S&P 500 edged up 0.1 per cent when Wall Street opened for trading on Thursday in an easing of a rally that has taken the benchmark above the 3,000 mark for the first time since early March. The tech-heavy Nasdaq was also up 0.1 per cent, while the Dow Jones Industrial Average rose 0.2 per cent.

Markets are increasingly on edge as relations between the US and China deteriorate, after Beijing’s National People’s Congress on Thursday approved the proposal to introduce a new national security law in Hong Kong.

Washington took initial steps on Wednesday towards potentially removing Hong Kong’s special trade status, after Mike Pompeo, secretary of state, said the US no longer viewed Hong Kong as autonomous from China.

“It is hard not to see the remarks by Mike Pompeo on Hong Kong . . . as anything but a gloves-off restart of US political hostilities towards China which will probably see trade tensions worsen and tit-for-tat retaliation commence,” said Robert Carnell, head of Asia-Pacific research at ING. “Personally, I struggle with the markets’ calm in the face of this.”

Dubai schools send plea to reopen at start of academic year

Simeon Kerr in Dubai

Dubai schools have lobbied authorities to allow them to open fully in September, providing clarity and support for students’ enrolment.

As the emirate eases restrictions after April’s lockdown, an industry group last week requested approval from the education ministry to open at the start of the academic year, subject to “robust UAE wide health and safety precautions”.

The letter to federal and local authorities, seen by the Financial Times, was sent by the Education Business Group, which represents almost 100 schools in Dubai, including GEMS, the world’s largest private provider of education.

In the letter, the group outlined proposals for keeping staff and pupils safe in September, such as temperature checks, staggered timings and social distancing by segregating year groups.

The call for schools to reopen fully comes after reports that the ministry was reviewing options for the next academic year.

One option could be the extension of distance learning through the autumn term if there is no improvement in the national health situation, one official was quoted in local media as saying. A “blended” model, including on-campus learning and online classes, is the best-case scenario if the Covid-19 outbreak is under control, the reports said.

School operators have been hit hard by the economic repercussions of the pandemic on parents, many of whom have been unable to pay fees. They have offered discounts this term or extended relief to families affected by redundancies or unpaid leave.

A slowdown over the years had hit UAE schools even before the onset of coronavirus and many will struggle to sustain operations through the disruption of the lockdown and bleak economic conditions.

US jobless claims top 40m

Matthew Rocco in New York

The number of Americans seeking unemployment benefits during the pandemic has eclipsed 40m, after an additional 2m people applied for the first time last week.

The data highlighted the deep economic damage caused by coronavirus and the shutdown of restaurants, retail stores and other businesses since government restrictions were imposed, driving US unemployment last month to its highest rate since Washington started tracking data in 1948.

A total of 40.8m Americans have filed for unemployment through state programmes over the past 10 weeks, data released by the labour department on Thursday showed.

Continuing claims, which tallies the number of unemployed who are actively receiving benefits, dropped 3.9m to 21.1m, accounting for 14.5 per cent of the workforce.

The pace of new jobless claims has slowed for eight consecutive weeks, as states have begun to emerge from coronavirus-related shutdowns and restart economic activity. The seasonally adjusted 2.1m initial claims last week reflected a drop from 2.4m a week earlier, which was revised slightly higher. The result matched economists’ forecasts as polled by Reuters.

On an unadjusted basis, jobless claims dropped to 1.9m from 2.2m for the week ended May 23.

Cummings may have committed ‘minor breach’ of rules, says police

Robert Wright in London

The UK prime minister’s chief adviser may have committed a “minor breach” of coronavirus lockdown regulations when he drove 26 miles to a beauty spot in the north-east of England from Durham, local police has said.

Dominic Cummings, who had driven to Durham from London on March 27 to self-isolate on a property owned by his father, did not commit an offence “contrary to [Covid-19] regulations”, the constabulary said on Thursday, adding that it will take no further action against Boris Johnson’s chief adviser.

The police said its examination of the circumstance was not concerned with the general government guidance to “stay at home”.

Durham Constabulary said that, if an officer had stopped Mr Cummings during the drive between his parents’ home in Durham and Barnard Castle, he would probably have been advised to return to Durham. If he had then agreed to do so, no further action would have been taken.

The force said it had no intention of taking “retrospective action” over the adviser’s behaviour.

The statement is the latest development in six days of controversy after the Guardian and Daily Mirror first revealed that Mr Cummings drove 260 miles from London to Durham on March 27 with his wife and four-year-old son to self-isolate in a house on his father’s property.

Two Sunday papers subsequently revealed that Mr Cummings then drove on April 12 from Durham to Barnard Castle, a trip that he said on Monday was to test whether his eyesight had been so damaged by coronavirus that it was unsafe for him to drive home to London.

Ministers have insisted that neither the drive to Durham nor the trip to Barnard Castle constituted breaches of the lockdown rules.

Thursday’s statement means Downing Street has avoided the prospect that a key member of the prime minister’s team would face a police investigation over his conduct.

Downing Street said after the statement that the police had made it clear they were taking no action against Mr Cummings over his self-isolation and that the initial trip did not breach the rules.

“The prime minister has said he believes Mr Cummings behaved reasonably and legally given all the circumstances and he regards this issue as closed,” Downing St said.

Wall Street to edge higher on open

The rally in US stock markets this week is set to slow down as tensions between the US and China continue to escalate and investors brace themselves for the latest set of US jobless benefit claims.

Futures for the S&P 500 point to the index edging 0.3 per cent higher when Wall Street opens for trading later in the day, in an easing of the rally that has taken the benchmark above the 3,000 mark for the first time in three months.

Markets are increasingly on edge as relations between the US and China continue to deteriorate. China’s National People’s Congress on Thursday approved a proposal to introduce a new national security law on Hong Kong.

Mike Pompeo, US secretary of state, said on Wednesday that the US no longer saw the city as autonomous given its treatment by China.

European markets shrugged off growing US-China tensions as their economies started easing lockdown restrictions, with London’s FTSE 100 and the continent-wide Stoxx 600 rising more than 1 per cent.

American Airlines to cut more than 5,000 staff

Claire Bushey in Chicago

American Airlines will cut 30 per cent of its management and support staff to adjust to shrunken global demand for air travel caused by the pandemic.

The Fort Worth-based airline employs 17,000 in the ranks of management and staff, so the cut translates to 5,100 people. It is offering a buyout programme through to June 10, but will begin layoffs if not enough people volunteer.

The airline will notify employees that they will be laid off in July, but they will remain on payroll with benefits until September 30, as required by the US CARES Act. American took $5.8bn in government grants and low-interest loans to preserve the size of its workforce during the collapse in demand.

“We will be a smaller airline, with fewer routes and fewer flights,” Elise Eberwein, the airline’s executive vice-president of people and global engagement, said in a memo to staff.

“Our preferred outcome is to properly size our frontline team for the future without having to implement involuntary furloughs. This is a goal, though, not a commitment, and a stretch goal at that.”

US dollar stores ring up sales surge during lockdown

Alistair Gray

Dollar stores have emerged as winners from the coronavirus crisis after US authorities allowed tens of thousands of the outlets to stay open during lockdown and as more shoppers try to trim their household budgets in the recession.

In stark contrast to department stores, clothing chains and other retailers, Dollar General’s quarterly like-for-like sales surged by the most since S&P Capital IQ began keeping track of the figures in 2011.

The company, which has more than 16,000 stores across the US, generated $8.45bn worth of sales in the three months to the start of May, up 21.7 per cent from last year’s levels on a comparable basis.

Huge changes to shopping habits during the pandemic also boosted sales at Dollar Tree, which has long underperformed its rival. The Virginia-based group, which has more than 15,000 outlets and owns the Family Dollar chain, generated revenues of $6.29bn, a like-for-like increase of 7 per cent.

Bonuses paid to staff weighed on margins, and Dollar Tree’s net income fell from $268m last year to $245m. Dollar General’s net income rose from $385m to $650m.

BoE policymaker calls for more stimulus to speed UK recovery

Delphine Strauss in London

The Bank of England should expand its asset purchase programme to limit the risk of a slow recovery that would cause long-term damage to the economy, according to a senior policymaker.

Michael Saunders was one of two members of the monetary policy committee who voted earlier this month to increase quantitative easing by another £100bn immediately, dissenting from a majority decision to leave the size of the BoE’s stimulus package unchanged. Many analysts believe the MPC may vote to step up the pace of asset purchases at its next meeting in June.

Mr Saunders warned, in an online speech, that while some recovery in economic activity was likely as lockdown eased, it could be slower than the central scenario set out in the BoE’s latest forecasts, with businesses fearful of failing and households worried about further job losses.

He said the surge in out of work benefit claims suggested unemployment had already risen from 4 per cent to about 9 per cent of the workforce, on top of the 8m jobs furloughed and large numbers of people on reduced hours.

A relatively slow recovery would be costly, he said, because it would hold back business investment and make people reluctant to switch jobs – with lasting effects for productivity and living standards. Meanwhile, the risks of inflation picking up while growth remained slow seemed “negligible”.

“At present, if we overdo the stimulus somewhat and then find the economy recovers strongly, we have ample tools and time to tighten policy again before persistent excess demand and inflation become a problem,” he said, adding: “If we provide too little stimulus, the economy could slip into a lowflation trap that is much harder to escape.”

European court annuls Vestager decision to block UK telecoms merger

Nic Fildes in London and Javier Espinoza in Brussels

A top European court has annulled a 2016 decision by competition commissioner Margrethe Vestager to block a merger of two British mobile telecoms companies on consumer interest grounds.

The ruling by the General Court, a constituent court of the European Court of Justice, comes as Brussels comes under pressure to allow mergers to help companies weather the pandemic.

The ruling on the European Commission’s decision not to allow the £10.25bn takeover of Telefonica’s O2 network in the UK by Three, owned by Hong Kong’s CK Hutchison calls into question the commission’s approach to merger interventions.

The court ruled the commission had made “several errors of law” in calculating the potential harmful effects of the Three/O2 deal and argued it had not proven that prices would rise or that competition would be harmed as a result of the deal.

The annulment by the bloc’s second highest court represents a fresh blow to Ms Vestager, who is serving a second stint as competition commissioner.

UK business expectations improve as tight restrictions ease

Valentina Romei in London

UK business expectations picked up in May as Covid-19 restrictions were relaxed, enabling more businesses to open and people to circulate outside their homes.

The index for production expectations for the three months ahead among industrial producers rose to minus 49 in May from minus 56 in the previous month, according to data collected by the European Commission.

The index tracking demand expectations among services producers improved to minus 64 in May compared with minus 76 in the previous month. Similar gains were recorded among retailers, for which the corresponding score rose 12 percentage points to minus 59.

The index is calculated as the difference between businesses reporting an increase and those recording a deterioration in demand and production. It represents the first comprehensive measure of less gloomy economic views of the near future.

Despite the improvement, sentiment remained depressed because the assessment of the pass level of activity deteriorated. Services were the worst performer with the overall index falling to minus 67.3 in May from minus 59 the previous month.

The reading for UK services was well below minus 30.8 for Germany, where the restrictions were eased earlier. It was 24 percentage points below that for the EU27 countries.

European business and consumer confidence picks up in May

Martin Arnold in Frankfurt

Europe’s pandemic-stricken economy is showing early signs of recovery after business and consumer confidence rebounded from near-record lows in May, the European Commission’s monthly survey shows.

The commission’s economic sentiment indicator for the EU rose by 2.6 points to 67.5, based on a survey this month of about 135,000 businesses and 32,000 consumers across the region.

It said consumer and industry confidence regained about a fifth of the record losses suffered after the pandemic led to the shutdown of much of Europe’s economy in March and April. However, confidence in the services sector continued to decline, albeit at a slower rate.

The outlook for the job market brightened as companies reported “significantly improved employment plans in all surveyed sectors”, which regained between a quarter and a fifth of the combined drop in March and April, the commission said. The recent surge in fears of job losses among consumers halted in May, it added.

Among the biggest economies, confidence recovered fastest in the Netherlands, Germany and Spain, while it fell slightly in France and dropped more in the UK. The commission said a month-on-month calculation was not possible for Italy, because it had been unable to carry out its survey in April.

Taiwan cuts 2020 growth prediction as retail sales slump

Kathrin Hille in Taipei

Taiwan has slashed its 2020 economic growth forecast as the suspension of economic life in many countries due to the pandemic is hitting demand for its exports.

Full-year gross domestic product is forecast to increase 1.7 per cent, which would herald its slowest growth in five years, instead of the previously forecast 2.4 per cent, the Directorate General of Budget, Accounting and Statistics said.

The latest forecast comes after retail sales weakened and growth in industrial production slowed in April.

However, even the revised outlook is more optimistic than forecasts for most other developed countries, reflecting Taiwan’s success in containing the spread of the disease that enabled it to avoid locking down society.

European stocks rise on hope of swift economic recovery

European stocks maintained some of their momentum as optimism about the reopening and quick recovery of economies outweighed fears of a second wave of coronavirus infections and an escalation in US-China tensions.

London’s FTSE 100 rose 0.7 per cent while Frankfurt’s Xetra Dax pushed 1 per cent higher in early trading on Thursday, while the continent-wide Stoxx 600 index rose 1 per cent.

Brussels’ proposal on Wednesday to borrow €750bn for its recovery fund raised hopes of a quicker economic rebound in Europe, as governments gradually lift restrictions on activity.

Futures markets pointed to gains of 0.3 per cent when Wall Street opens.

Hong Kong’s Hang Seng index bucked the trend, dropping 0.8 per cent on Thursday as Washington took initial steps towards potentially removing the city’s special trade status.

Health minister warns situation in South Korea is critical

Song Jung-a in Seoul

South Korea’s health minister Park Neung-hoo has warned the next two weeks will be critical to stem further spread of coronavirus amid growing fears of a second wave of infections.

The country announced on Thursday it would strengthen quarantine measures for two weeks in Seoul and the surrounding metropolitan areas as the country reported its biggest jump in daily infections for nearly two months.

Public facilities in the area, such as galleries and parks, will be closed for two weeks.

Mr Park also urged entertainment venues to suspend operations for two weeks or to follow strict quarantine rules if they remained open. He also asked people to refrain from joining big gatherings. The country has been battling to suppress recent clusters of infections stemming from Seoul’s nightclub area and a logistics centre.

South Korea on Thursday reported 79 new cases, about double the number reported a day earlier. Earlier in the day, the Gyeonggi provincial government issued a “no assembly” order for Coupang’s logistics centre in Bucheon, west of Seoul, for two weeks, practically banning its business operation.

So far, 82 infections have been traced to the Coupang warehouse. The company, which is backed by SoftBank, is the country’s largest ecommerce operator. More than 4,000 people have been tested over the warehouse-related infections, according to health authorities.

Spain and Germany suffer steep falls in consumer spending

Valentina Romei in London

Retail sales in Spain and Germany fell at the fastest pace on record, while inflation slowed as the pandemic forced the closure of most shops and crushed demand.

In April, the volume of retail sales in Spain fell 31.6 per cent compared with the same month last year, according to official data. This represents by far the largest drop on record and dwarfs the 14 per cent fall in March.

In Germany, experimental statistics showed that the value of sales dropped 13.8 per cent compared with the previous month, national statisticians Destatis reported. The drop follows a 7.5 per cent fall in March and takes sales back to their 2016 level.

The German data are based on a new experimental early indicator determined from monthly sales tax returns, providing initial results before the official survey is available.

Despite both countries relaxing lockdown measures, levels of demand and economic activity remain depressed. Separate official Spanish data show consumer prices — a broad measure of demand — have contracted by 1 per cent in May compared to the same month last year, the lowest in four years.

In the German state of Saxony, inflation slowed to 0.9 per cent in May compared to 1.1 per cent in the previous month, dragged down by lower energy prices and an easing of food prices growth.

Daily Mail owner swings to operating loss in April as pandemic bites

Daily Mail owner DMGT has posted a 23 per cent drop in total group revenue for April and swung to an operating loss as the effects of the coronavirus pandemic began to bite.

The media and events group reported an adjusted operating loss of £3m for April, the month in which strict lockdowns began to take effect on businesses and economies worldwide. That loss compared with a £5m profit in the same month a year ago. First-half adjusted revenue fell 5 per cent to £690m from the same period a year ago. The group did not specify the April revenue in figures.

Nonetheless, the London-listed group raised its interim dividend 3 per cent to 7.5p a share, which it said reflected its first-half trading performance.

DMGT shares fell 6.5 per cent in early London trading on Thursday, bringing its decline for the year to more than 15 per cent.

Almost all of the group’s second-half events have been cancelled or postponed, with £8m of accelerated costs recognised in the first half.

“Covid-19 is adversely affecting the consumer media, UK property information and events and exhibitions businesses,” the group said on Thursday.

“The severity and duration of the Covid-19 crisis remains unclear but DMGT has a robust balance sheet, access to significant funding and a diversified portfolio,” chief executive Paul Zwillenberg said. “This gives me, and the board, confidence that we will weather the current storm and withstand a sustained period of global economic uncertainty.”

DMGT, the parent company of the Daily Mail titles, MailOnline, known for its racy celebrity coverage, and Metro, has attempted to simplify its sprawling business in recent years.

The company, which disposed of some of its property and energy assets late last year, added bolt-on acquisitions such as the i, the UK national newspaper and website, in November. In March, it raised its stake to 23 per cent in Cazoo, an online start-up that seeks to change the way people buy used cars in the UK.

GSK to produce 1bn doses of coronavirus vaccine booster

Donato Paolo Mancini in London

GlaxoSmithKline has said it will produce 1bn doses of a vaccine booster as the pharmaceuticals group steps up its preparations for an eventual immunisation for coronavirus.

The London-listed company, which is one of the world’s largest vaccine makers, said its adjuvant could make “a significant contribution against Covid-19”.

“As demonstrated in the last flu pandemic, GSK’s pandemic adjuvant can reduce the amount of vaccine protein required per dose, which allows more vaccine doses to be produced, contributing to protecting more people,” GSK said. “Additionally, an adjuvant can enhance the immune response and has been shown to create a stronger and longer lasting immunity against infections.”

Adam Barker, an analyst at Shore Capital, said the development of an adjuvant would allow for a greater amount of the eventual vaccine to be “produced in a quicker time period”.

The industry has been scrambling to produce viable vaccine candidates, compressing timelines that can span a decade into months as authorities worldwide search for a way forward.

Roger Connor, the president of GSK’s global vaccines division, said more than one vaccine would be needed to address the pandemic. GSK is working with Sanofi on a vaccine candidate. UK rival AstraZeneca is collaborating with the University of Oxford on its vaccine candidate. The partnership has attracted a promise of more than $1bn in funding from the US.

Shocking video puts spotlight on India’s humanitarian disaster

Stephanie Findlay in New Delhi

A video, which appears to show a toddler trying to wake up his dead mother who is lying on a train platform, has gone viral on social media, putting the spotlight on the unfolding humanitarian disaster in India.

Several people have died on India’s special trains transporting migrant workers home after being stranded for weeks without food, work or money by the country’s harsh lockdown to control the spread of coronavirus.

https://twitter.com/sanjuydv/status/1265495633949085698

Authorities have acknowledged that there have been deaths on the trains, but insisted that they were caused by underlying conditions, according to a report in the local Hindustan Times newspaper.

More than 3,500 special trains have carried 4.8m passengers since they started running earlier this month to help stranded workers who have been stuck since the lockdown was imposed in late March.

New Delhi is easing its strict lockdown as it tries to kickstart the economy, even as coronavirus cases rise rapidly. India is now among the top 10 countries of total confirmed cases, with 158,000 coronavirus cases and 4,500 deaths, according to Johns Hopkins University.

UK travel chiefs urge government to drop quarantine plans

Alice Hancock in London

More than 70 UK travel chiefs have called on the government to cancel its plans for compulsory 14-day quarantines for travellers arriving from abroad, accusing it of being “woefully slow to react” to the pandemic.

In a letter sent to the home secretary on Thursday, the chief executives and directors said that mandatory quarantines was “the very last thing” the travel industry needed as it looked towards recovery after months of lockdown as coronavirus spread.

“The quarantine plans are poorly thought-out, wholly detrimental to industry recovery and are more or less unworkable,” the letter to Priti Patel said.

Signatories included directors of major London hotels, such as The Savoy, The Dorchester and Claridge’s, as well as travel companies including Abercrombie & Kent, Red Savannah and Mr & Mrs Smith.

The travel industry has been at the brunt of coronavirus restrictions from early on as the spread of the virus prompted countries to shut borders and flights to be cancelled en masse.

The letter argued that the £200bn UK travel sector was “severely challenged” and that continuing with the quarantine plans could put many jobs among the 4m employed in the industry at risk.

UK corporate news round-up

Cineworld expects cinemas in all of its 10 markets to reopen by July as governments lift restrictions related to film theatres. The cinema chain announced that it had secured a waiver for the testing of its debt covenant in June, while increasing the net debt to ebtida ratio to 9 times for its covenant test in December and adding $110m to its revolving credit facility.

EasyJet plans to reduce its staff by 30 per cent, as the low-cost carrier expects the size of its fleet to be reduced to 302 aircraft at the end of 2021, 51 planes lower than it forecasted before the outbreak of Covid-19. The group said it expected to run at 30 per cent capacity in the summer months, as European governments eased travel restrictions in an attempt to salvage the continent’s peak tourist season.

Online fashion group boohoo will acquire the remaining 34 per cent of shares in PrettyLittleThing from minority shareholders for £269.8m, which may potentially rise to £323.8m depending on share price performance. The acquisition comes after the group pushed back against accusations by a short seller that it has inflated its cash flow and played down the eventual cost of its majority stake in PrettyLittleThing acquired in 2016.

Pharmaceutical company GSK said it intends to manufacture 1bn doses of its vaccine efficiency boosters, known as adjuvants, in 2021, to support the development of multiple Covid-19 vaccine candidates.

Stagecoach, a transport company, expects a “lasting effect” of the pandemic on travel patterns with an acceleration in trends of increased homeworking, shopping from home, telemedicine and home education.

EasyJet job cuts loom as airline expects capacity at about 30%

EasyJet plans to cut jobs by up to nearly a third, reflecting its reduced fleet of aircraft, as the low-cost airline seeks to rebuild and improve productivity following the blow to the industry from the coronavirus pandemic.

The airline said on Thursday it would begin an employee consultation process “in coming days” on its proposals to reduce staff numbers by up to 30 per cent. That puts a maxiumum of 4,500 jobs at stake out of the airline’s total 15,000.

EasyJet expects to fly about 30 per cent of the planned capacity in the fourth quarter while by its year end in 2021 the size of its fleet will be at about 302 aircraft. That comes to 51 lower than what was anticipated before the coronavirus pandemic. It is unable to provide guidance for the remainder of its fiscal year.

The airline, which has had to ground almost its entire fleet since the end of March following widespread lockdowns and travel restrictions, does not expect demand levels of 2019 to return until 2023, in line with Iata projections. Its chief financial officer this week announced plans to leave the group next year.

Thailand estimates 8.4m jobs at risk from pandemic

John Reed in Bangkok

Some 8.4m workers in Thailand “are at risk of termination” because of the impact of Covid-19 on demand for labour, the kingdom’s state planning agency said on Thursday.

The number is higher than previous estimates, and reflects growing concerns over the impact of the coronavirus and an ongoing drought on tourism and other industries in south-east Asia’s second-largest economy.

Of the 8.4m jobs at risk, 2.5m are tourism, 1.5m in industry, and about 4.4m in service sectors other than tourism, the office of the national economic and social development council said in a regular update.

However, the body said that it expected the unemployment rate to reach only 3-4 per cent this year, with no more than 2m unemployed, as lockdown measures were eased and the epidemic brought under control.

Thailand has thus far escaped the worst of the coronavirus, with just over 3,000 cases of the disease and 57 deaths confirmed to date, but worldwide shutdowns have caused tourist arrivals to plummet and put millions of service jobs at risk.

Trade Secrets: Covid-19 crisis highlights supply chain vulnerability

Judith Evans in London

As the Covid-19 pandemic gathered pace in March, the chief executive of Nestlé warned his almost 300,000 staff: “Get ready for the storm to hit.”

But the maker of foods from Cheerios cereal to Kit Kat chocolate and Maggi noodles has so far navigated the storm: in April it reported its best quarterly sales growth in almost five years.

The agility of networks such as Nestle’s has contributed to what many analysts say is a strong performance by global food supply chains so far in the pandemic.

Yet as the virus spreads, parts of the food chain are faring less well. Coronavirus has swept through US meat packing plants, forcing several closures. The chairman of Tyson Foods, the US meat company, warned in April of looming shortages: “The food supply chain is breaking,” he said.

Read more here

Restaurants and hotels clean up with toilet paper sales

Aime Williams

In an effort to keep trading during the coronavirus pandemic, Old Ebbitt Grill, one of Washington DC’s oldest restaurants, began serving takeaways. Its menu, which usually offers oysters and steaks to tourists lunching across from the White House, now features a new item: toilet paper, costing $2.50 a roll and limited to two per order.

As the Covid-19 panic-buying empties supermarket shelves of toilet paper, many restaurants, hotels and offices — devoid of their usual visitors — are flush with it.

Leon, a restaurant chain that usually focuses on selling flat whites and halloumi wraps to passing office workers, says it started offering toilet rolls with online orders when it realised customers were struggling to find them in supermarkets.

“Meanwhile, with restaurants, bars and hotels closed, the hospitality supply chain has been sitting on an abundance of [toilet roll] stock,” says Glenn Edwards, managing director of Leon’s US division.

Nielsen, which measures supermarket data, reported a 71 per cent year on year increase in US retail toilet paper sales in the nine weeks to May 2.

Read more here

UK temporarily shuts North Korea embassy due to coronavirus

Song Jung-a in Seoul

Britain has temporarily shut down its embassy in North Korea with all diplomatic staff leaving the country amid the coronavirus pandemic, joining other foreign delegations who have already left the communist state.

UK ambassador Colin Crooks said in a Twitter post that the embassy closed on Wednesday and all diplomatic staff had left North Korea “for the time being”.

The UK Foreign Office said in a statement that the decision was made because “restrictions on entry to the country have made it impossible to rotate our staff and sustain the operation of the embassy”. It added that it would seek to re-establish a presence in Pyongyang as soon as possible.

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The diplomats crossed the border into China via land as flights have been suspended, according to Seoul-based NK News that monitors North Korea.

North Korea has yet to report any confirmed case of Covid-19 but placed thousands of people under quarantine. Pyongyang imposed tougher quarantine measures on foreigners. In March, more than 60 foreigners who were quarantined for more than a month in Pyongyang left the country on a special flight.

Several countries including Germany and France also closed their missions in North Korea in March while Sweden’s ambassador to North Korea, Joachim Bergström, still remains in Pyongyang.

North Korea acted swiftly to close borders in January to prevent the coronavirus outbreak. It has banned foreign tourists and sharply reduced trade with China, calling its fight against the virus a matter of “national existence”. Experts have warned that the country was particularly vulnerable given its poor public health system.

Pandemic prompts jump in UK trade union membership

Anna Gross, Bethan Staton and Delphine Strauss in London

UK trade unions are reporting a stream of new members since the start of the coronavirus lockdown, reflecting increased anxiety over workplace safety and the risk of redundancies.

The heightened imperative to ensure safety at work provoked by the pandemic — after years in which ministers have viewed health and safety inspections as a burden to be minimised — has given unions a new-found influence in talks with the government over the reopening of schools and other key sectors of the economy.

Figures from some of the largest unions suggest that it is also reinforcing a recent stabilisation in trade union membership after decades of decline. Unison, whose membership of 1.34m is concentrated among public sector workers, said it had seen a net increase of 16,000 in the year to date — 18 per cent higher than the gain in the same period of 2019.

The biggest spike in inquiries came directly after Boris Johnson’s address to the nation on May 10, urging people to return to work.

Read more here

Bank of Korea forecasts slowest growth in two decades

Song Jung-a in Seoul

The Bank of Korea has slashed its growth forecast for this year, predicting a 0.2 per cent contraction, which would be the slowest growth in over two decades, as the export-driven economy is battered by the coronavirus pandemic.

The revised outlook for Asia’s fourth-largest economy is a sharp cut from the bank’s February estimate of a 2.1 per cent expansion for 2020 but it is still higher than the IMF forecast of a 1.2 per cent contraction.

The downward forecast was announced on Thursday after the BoK cut interest rates by 25 basis points to a new record low of 0.5 per cent.

South Korea has rolled out a series of stimulus packages worth about $200bn to cushion the economic blow of the pandemic. The South Korean economy contracted 1.4 per cent in the first quarter. Exports, which account for 40 per cent of the economy, slumped 24 per cent in April from a year earlier.

The BoK expects a sharp recovery next year, predicting a 3.1 per cent growth in 2021. It also forecast the country’s inflation would average 0.3 per cent this year before rising to 1.1 per cent next year.

Philippines’ task force recommends easing Manila lockdown

John Reed in Bangkok

The Philippines’ coronavirus task force has recommended easing quarantine restrictions in greater Manila starting on June 1, in a move that if implemented would end one of Asia’s strictest lockdowns.

The group made the recommendation that the megacity, where more than 12m people live, be placed under “general community quarantine” to President Rodrigo Duterte, who is expected to announce his decision on the measures in a speech on Thursday night.

The easing, if announced, would represent a relaxation of the strict “enhanced” community quarantine imposed in mid-March on Manila and Luzon island, the country’s business heartland, under which all but the essential movement of people was banned.

Despite the restrictions, the Philippines has reported more than 15,000 coronavirus cases to date and 904 deaths, the third-highest rate in south-east Asia after Singapore and Indonesia.

South Korea reports 79 new coronavirus cases as warehouse cluster grows

Song Jung-a in Seoul

South Korea on Thursday reported a spike in new coronavirus cases linked to a warehouse operated by the country’s leading e-commerce operator, renewing concerns about community spread in Seoul and the surrounding metropolitan areas, where about half of the country’s population lives.

A total of 69 cases have been traced to Coupang’s logistics centre in Bucheon, west of Seoul, as health authorities are trying hard to prevent a second wave of infections with mass testing and aggressive contact tracing and isolation measures.

The country on Thursday reported 79 new infections, the biggest one-day increase in nearly two months. “Infection routes have been diversified in workplaces, cram schools, bars and karaoke rooms in the metropolitan area,” said health minister Park Neung-hoo in a government meeting.

South Korea has won international praise for largely containing the outbreak without mass lockdowns. It reopened its economy and relaxed social distancing in early May, ahead of other countries, as the virus appeared to have been brought under control.

But the recent flare-ups, stemming from a cluster of infections linked to nightclubs in Itaewon, the nightlife district in Seoul, underscore the challenges in eradicating the virus.

Myanmar ‘has jailed at least 500’ for violating restrictions

At least 500 people, including children, returning migrant workers, and religious minorities, have been jailed in Myanmar since last March for violating curfews, quarantines and other coronavirus-related restrictions, according to a human rights advocacy organisation.

Authorities have charged hundreds more in cases that are ongoing or have resulted in fines, Human Rights Watch added on Thursday, arguing that imprisoning people for violating curfews, quarantine, and physical distancing directives is counterproductive for reducing threats to public health.

“Limiting public health risks through social distancing is crucial, but jailing people for being outside at night just adds to everybody’s risk,” said Phil Robertson, deputy Asia director at Human Rights Watch. “Throwing hundreds behind bars in crowded, unhygienic prisons defeats the purpose of containing the spread of Covid-19.”

In March and April, Myanmar authorities announced strict rules aimed at reducing the spread of the coronavirus including a mandatory 28-day quarantine for foreign arrivals, nighttime curfews, a ban on gatherings over 5 people, and several township-level lockdowns, the advocacy group said.

Bank of Korea cuts rates as pandemic threatens exports

Song Jung-a in Seoul

The Bank of Korea on Thursday cut interest rates by 25 basis points to a record low of 0.5 per cent to as the coronavirus pandemic takes a toll on the country’s export-driven economy.

The latest monetary easing, which follows a 50 basis point cut in March, came after South Korea rolled out a series of stimulus packages worth about $200bn to help out troubled small and mid-sized companies, spur domestic spending and create jobs.

The South Korean economy contracted by 1.4 per cent in the first quarter, led by a 6.4 per cent drop in consumption. Despite recording the worst performance since the 2008 global financial crisis, South Korea has fared better than other major economies as the country has avoided imposing a nationwide lockdown.

However, policymakers are warning of a more severe economic fallout in the current quarter amid a collapse in demand from key trading partners. Exports, which account for 40 per cent of the South Korean economy, slumped 24 per cent in April from a year earlier and are likely to fall further this month.

The IMF forecast the South Korean economy will shrink 1.2 per cent this year while Lee Ju-yeol, the BoK governor, has said the economy would still eke out growth of less than 1 per cent. The BoK is expected to revise its growth forecasts later on Thursday.

South Korea is attempting to offset trade headwinds with domestic spending and there are signs of a tentative consumption recovery, driven by Won14.3tn ($11.7bn) of government cash handouts to all households.

President Moon Jae-in has promised to create half a million jobs in the public sector through the “Korean-style New Deal” scheme as the country’s job losses rose at their sharpest pace in two decades last month.

News you might have missed

There were signs of optimism as the S&P 500 closed above 3,000 points for the first time in 12 weeks. Earlier in Europe travel and leisure stocks, which have been among the worst hit since the coronavirus crisis began, posted large gains for a second day. In the US Disney World is planning to reopen its gates in July as lockdowns ease across the US.

However, the Federal Reserve said economic activity fell “sharply” in most parts of the US heading into May and Goldman Sachs has pushed back this year’s planned launch of a digital wealth management platform and is slowing its hiring of advisers.

Mexico’s central bank has slashed its 2020 gross domestic product forecast to a worst-case prediction of a contraction of almost 9 per cent, and said as many as 1.4m jobs could be lost this year.

In the airline industry, Willie Walsh, chief executive of British Airways’ parent group IAG, said the airline was pressing ahead with plans to cut up to 30 per cent of staff. Boeing plans to lay off more than 12,000 workers starting this week—more than half of them involuntarily. Lufthansa’s supervisory board has refused to approve a €9bn bailout package, after the European Commission sought to force the airline to give up coveted slots at Frankfurt and Munich airports.

And an independent organisation has been set up to raise funds for the World Health Organization from wealthy individuals, companies and the general public.

News Corp axes print editions of more than 100 local Australian titles

Jamie Smyth in Sydney

News Corp, the Rupert Murdoch-controlled publishing group, has announced sweeping changes to its Australian arm, abolishing the print editions of more than 100 regional and community titles, making many of them available online only and closing some altogether.

The decision on Thursday follows a comprehensive review of the Australian publishing portfolio, which has struggled due to digital disruption and a recent reduction in print advertising due to the Covid-19 pandemic.

News Corp said some jobs roles would change and there would be job losses, without putting a figure on the number of redundancies that it expects over coming months.

Michael Miller, executive chairman of News Corp Australasia, said the changes reflected the ongoing consumer shift to reading and subscribing to news online and a decline in print advertising.

“Covid-19 has impacted the sustainability of community and regional publishing. Despite the audiences of News Corp’s digital mastheads growing more than 60 per cent … print advertising spending which contributes the majority of our revenues, has accelerated its decline,” he said.

The decision by Australia’s biggest media company followed similar moves by publishing groups in the US and UK, where local advertising spending has been hit by the collapse of businesses in sectors such as hospitality and retail due to the pandemic.

Publishers have also been hit by a shift in advertising spending to online platforms such as Facebook and Google, which now account for more than two-thirds of the market in Australia.

News Corp said it would now publish 92 digital-only local and community mastheads. Just over 30 community and regional titles would cease publishing altogether.

Asia stocks track Wall Street rally, Hong Kong equities set to fall

Stock markets in Asia-Pacific moved higher on Thursday after European stocks climbed on stimulus plans and Wall Street looked past rising US-China tensions to close at a 12-week high

The Topix in Japan added 0.7 per cent, South Korea’s Kospi was up 0.8 per cent and Australia’s S&P/ASX 200 rose 0.4 per cent. Futures point to a 0.7 per cent fall when the Hang Seng opens in Hong Kong.

Overnight, the S&P 500 ended 1.5 per cent higher, closing about the 3,000-point level for the first time in 12 weeks as investor sentiment was buoyed by stimulus plans in Europe to support economic recovery.

That optimism was tempered after Mike Pompeo, US secretary of state, said the US no longer viewed Hong Kong as autonomous from China following Beijing’s plan to impose national security laws on the territory. The announcement could lead to the removal of Hong Kong’s special trade status.

S&P 500 futures were up 0.2 per cent.

JPMorgan forecasts 50% rise in second quarter markets revenue

Laura Noonan in New York

JPMorgan Chase is on course for a 50 per cent increase in markets revenues in the second quarter, investment bank boss Daniel Pinto said, predicting a performance even stronger than the trading boom of the first quarter when the spread of coronavirus triggered a jump in volatility.

Mr Pinto, who is also co-president of JPMorgan Chase, said that if markets revenues for June came in at the average level for the previous three Junes, then “it gives us a number in markets, year-on-year, for the second quarter around 50 per cent up —five, zero”.

He added that the performance of fixed income was “substantially” better than equities, but that equities was also doing well. JPMorgan’s fixed-income revenues rose by 34 per cent in the first quarter versus a year earlier, while its equities trading revenues rose 28 per cent on the same basis.

In investment banking — the business of advising clients on deals and fundraising — Mr Pinto said his revenues should be up by a “mid-teens” percentage for the second quarter versus a year earlier, but that the revenues were largely based on “transactions from last year that are being closed this year”.

“The new M&A activity is roughly down 40 per cent year on year … which is going to hurt going forward, particularly early next year,” he added.

Mr Pinto said that M&A revenues market wide would probably be 15-20 per cent lower in 2020 “depending on how the economy goes”.

US death toll tops 100,000

Peter Wells in New York

More than 100,000 people in the US have died from coronavirus, the most in the world, according to a widely-followed tally from Johns Hopkins University.

The national total hit 100,047, ticking past the grim milestone on Wednesday evening New York time, and representing 28.3 per cent of all deaths worldwide. The US has for a number of months been the global hotspot for Covid-19, with about 1.69m confirmed cases in the country out of about 5.65m globally.

The US’s overall total exceeds the combined total of the next three hardest-hit countries — the UK, Italy and France.

Johns Hopkins University counts so-called probable deaths in its tally, which Covid Tracking Project, an alternate data source, does not. The latter puts the total number of deaths in the US since the pandemic began at 94,352 as of Wednesday afternoon.

A further 1,259 people died in the US from Covid-19 over the past 24 hours, according to data compiled by Covid Tracking Project, up from 629 on Tuesday and the largest one-day increase since May 21.

One-day increases tend to be lower at the weekend and on Monday due to slower reporting over the weekend, with a tick-up on Tuesday. That pattern was probably delayed this week owing to the Memorial Day public holiday on Monday.

Illinois, New Jersey and Pennsylvania experienced the largest one-day increases in deaths, with 160, 148 and 113, respectively. New York, the hardest-hit state overall, again managed to keep its daily rate below 100 in what has proved to be an encouraging sign amid the pandemic.