Virus spread picks up in Spain as death toll rises

Daniel Dombey in Madrid

Spain has reported a record 849 people have died in the past 24 hours after contracting coronavirus while the spread of the virus has picked up marginally after a deceleration in recent days.

In total 8,189 people have died, compared with 7,340 on Monday, government figures revealed on Tuesday. Overall, confirmed cases have increased 11 per cent to 94,417. This represents a rise on the previous daily rate of increase of 8 per cent, but is still well down on this month’s highs of 25 per cent and more.

The figures showed that 19,259 people have recovered to date and 5,607 have needed attention in intensive care.

Spain is under a two-week-old lockdown, which was intensified this week with a ban on all work deemed to be “non-essential”, in an attempt to bring down transmission of the virus and relieve stress on intensive care.

Italy pays steeper rate to issue first sovereign bonds this month

Tommy Stubbington in London

Italy paid the highest borrowing costs in eight months at its first bond sale since the intensification of the coronavirus crisis, as investors sought higher returns for added risk.

The Italian treasury raised €8.5bn — the maximum planned — across four different bonds, in the latest sign that European Central Bank’s massive debt purchases have stabilised a market which threatened to go into freefall two weeks ago.

The yield for the 10-year bond came in at 1.48 per cent, up from 1 per cent at the last sale at the end of February and the highest level since July last year.

“They have market access and auctions are working normally, and that’s encouraging,” said ING rates strategist Antoine Bouvet. “It’s more expensive for Italy to borrow now, but that takes a long time to feed through to their average funding costs.”

Analysis: Police methods during lockdown raise liberty fears

Police in England were last week granted the right to levy fines of £60 for first offences against a range of regulations banning unnecessary travel and gatherings of more than two people in public.

The Home Office, when announcing the new powers said it expected forces — which enjoy substantial discretion in how they use their powers — to apply their “common sense and discretion”.

But some forces’ behaviour prompted Jonathan Sumption, a former Supreme Court justice, and others, to warn on Monday of the risk of a “police state”.

Robert Wright in London explores whether tough tactics used by the police puts the traditional consensual approach at risk.

Read the full story here

12-year-old girl dies from coronavirus in Belgium as toll rises

Jim Brunsden in Brussels

The Belgian authorities have confirmed that a 12-year-old girl has died from coronavirus.

The death of a child from coronavirus is “very rare, but it is devastating for us”, said Emmanuel André, a scientist and spokesman for the Belgian government’s crisis centre. “We think in particular of her family and her close ones.”

Belgium’s death toll from the pandemic now stands at 705, an increase of 192 compared with yesterday’s data. The crisis centre said that close to half of the increase came from people who died before yesterday.

The centre said that the occupancy rate of intensive care beds in the country stood at 53 per cent.

Europe secures medical supply line to Iran

Michael Peel in Brussels

European countries have arranged the export of medical goods to Iran, in the long-awaited first deal under a financial channel set up to shield trade from US sanctions.

The mechanism known as Instex created by Germany, France and the UK “successfully concluded its first transaction”, Germany’s foreign ministry tweeted on Tuesday, after the Europeans had grappled for 18 months with transatlantic political pressure and technical difficulties.

“#GoodNews (finally),” tweeted Federica Mogherini, the former EU foreign policy chief, who in September 2018 unveiled the plan to set up Instex, as part of the European response to US President Donald Trump’s decision to exit a landmark nuclear deal with Tehran.

It was not immediately clear what the value of the transaction was or whether the medical goods were directly related to the coronavirus pandemic.

Josep Borrell, Ms Mogherini’s successor, said last week that the EU would send €20m of coronavirus humanitarian aid to Iran and back Tehran’s request for IMF funding to fight the crisis.

Daytime is the new primetime in TV business

Anna Nicolaou in New York

As millions stay home worldwide due to the coronavirus pandemic, use of streaming services has soared during the morning and afternoon hours — typically a dead zone for television while consumers are at work.

Daytime viewing on streaming services jumped 39 per cent from March 9-23, according to analytics company Conviva. In contrast, streaming use declined 2 per cent over the same period in “primetime” — between 8pm and 10pm when TV networks traditionally air their best shows.

“As we all adjust to the new normal, streaming and social video have become even more important to many American households,” said Bill Demas, chief executive of Conviva, adding that the growth in daytime streaming was “surprising”.

The streaming frenzy has prompted Netflix, Amazon and YouTube to reduce their picture quality in Europe to ease pressure on broadband networks.

Eurozone inflation rate dives in March as virus disrupts economy

Martin Arnold in Frankfurt

Inflation slowed across the eurozone in March as energy prices plummeted and economic activity came to a standstill in many areas due to the disruption caused by coronavirus.

The fall in prices raises the spectre of deflation in many southern European countries despite the radical monetary easing measures recently launched by the European Central Bank.

Harmonised consumer prices in the 19 eurozone countries fell to 0.7 per cent in March, from 1.2 per cent in February, a flash estimate from Eurostat revealed on Tuesday. That matches a three-year low set in October 2019 and is lower than the 0.8 per cent increase in prices expected by economists who were polled by Reuters.

Energy prices fell 4.3 per cent in March, reflecting the drop in oil prices after Saudi Arabia started a price war with Russia. However, unprocessed food prices rose 3.5 per cent as many Europeans reacted to the spread of coronavirus by bulk-buying staples such as pasta, flour and rice.

Several countries are flirting with deflation after prices rose by only 0.1 per cent in Italy, Greece and Portugal and by 0.2 per cent in Spain.

Excluding the more volatile energy, food and tobacco prices, underlying eurozone inflation slowed from 1.2 per cent to 1 per cent. The slowing rate of price growth, which reverses a recent trend of rising prices, means the European Central Bank is moving further from its main objective for inflation to be below but close to 2 per cent.

China to announce asymptomatic coronavirus cases from April

Christian Shepherd in Beijing

China will for the first time include asymptomatic coronavirus cases in its nationwide count, after experts criticised the government for leaving infections out from its official tally.

Starting from April 1, individuals who tested positive for Covid-19 but did not display symptoms would be announced daily, China’s national health commission said on Tuesday.

The commission added that a survey of asymptomatic cases will be carried out in areas heavily affected by the outbreak in order to improve containment measures.
1,541 asymptomatic individuals, 205 of whom arrived in China from overseas, had received medical attention from the beginning of the outbreak, it said.

The Chinese government’s refusal to publicly disclose cases that test positive but have no clinical symptoms has been a central concern of experts who doubt China’s claim to have “basically halted” transmission of the virus within the country.

In recent days, cases of newly confirmed asymptomatic cases have been reported in Gansu and Guangdong provinces, both brought to the regions from travellers leaving Hubei, the province most affected by the outbreak.

Thailand outlaws April Fool’s Day coronavirus tricks

John Reed in Bangkok

Thailand on Tuesday warned that it would criminally prosecute anyone who claimed to have coronavirus as an April Fool’s Day prank.

The government’s PR department warned “scaremongers not to spread false news or rumours” in a post on its official Twitter account.

Thailand’s government said that violators would be prosecuted either under the country’s Computer Crime Act, which it uses to police the internet, or an emergency decree dating to 2005 that Prime Minister Prayuth Chan-ocha invoked last week to impose emergency rules in response to the Covid-19 pandemic.

“People around the world are suffering from #Covid19 outbreak, and that’s reason enough why people should be more considerate and not use this as a prank or a joke,” the government said.

Thailand on Tuesday reported 127 new coronavirus cases, bringing the total to 1,651 since the outbreak began, 10 of whom have died.

Dubai to inject fresh capital into Emirates airline

Simeon Kerr in Dubai

Dubai pledged to support Emirates airline with financial assistance during this “critical period”.

The government, the carrier’s current shareholder, will inject new equity into the company, Sheikh Hamdan bin Mohammed Al Maktoum, the crown prince, said in a statement on Tuesday. Details will be released at a later stage.

Emirates, one of the world’s leading long-haul carriers, has like most airlines been hit hard by global restrictions on travel and reduced demand because of the coronavirus pandemic. Scheduled passenger flights from its home base in Dubai have been suspended. The airline has grounded much of its fleet and cut staff salaries.

The support has been made available to Emirates because of its strategic importance to the economies of Dubai and the United Arab Emirates and “the airline’s key role in positioning Dubai as a major international aviation hub,” he said.

Russia reports largest daily rise in Covid-19 cases

Henry Foy in Moscow

Russia reported 500 new cases of coronavirus on Tuesday, its largest daily increase by far, as the total number of infections surged 27 per cent to 2,337.

Russia said the number of people who had died almost doubled overnight to 17. The country has fewer cases than other European states but has seen a major spike in infections over the past week, with cases roughly doubling every three days.

The government has called for a lockdown imposed on Moscow – allowing people to leave their homes only for essentials – to be spread across the country in a bid to stem the spread of the pandemic.

President Vladimir Putin on Monday ordered senior officials to make preparations “in all regions, taking into account all calculated options for the development of the [virus] situation based on the experience of other countries.”

Retail sales slashed in Hong Kong

Primrose Riordan in Hong Kong

Retail sales in Hong Kong dropped by 44 per cent in February compared to the year before to HK$22.7bn (US$2.9bn) as the coronavirus outbreak ravaged the sector and people were forced to stay at home.

Comparing the first two months of the year with the same period the year before, sales of watches and clocks dropped by 58.6 per cent, clothing by 49.9 per cent, motor vehicles by 24.2 per cent and department store commodities by 41.4 per cent, according to estimates by Hong Kong’s statistics department.

But the department said supermarket sales increased by 11.1 per cent in the same period.

ONS releases death figures for March

Chris Giles in London

The first sign that coronavirus is causing more people to die in England and Wales than the government has indicated was revealed in official figures on Tuesday. 

In its weekly report into deaths in the two nations, the Office for National Statistics said that, by March 20, it had seen evidence of 210 deaths where Covid-19 was cited by an attending doctor as a potential factor compared with 170 people the Department of Health and Social Care recorded as dying in hospital from the virus.

The ONS said its number “is higher than the figures the [health department] publish as it includes deaths related to Covid-19 that took place outside of hospitals and those not tested for Covid-19”.

The 210 figure is likely to rise as more deaths are recorded and registered on national systems, a process which can take some time. 

London’s gin distilleries switch to making hand sanitiser

Robert Wright in London

Three London-area gin distilleries are switching some of their production to ensure the capital’s police force has enough hand sanitiser for officers during the Covid-19 outbreak, the Metropolitan Police has said.

The force, the UK’s biggest police service, said on Tuesday that staff at its Commercial Services Department had recently started to look for alternative sources of hand sanitiser because of shortages and had contacted a number of distilleries and breweries about supplies.

The force said three operators – Portobello Road Gin of Notting Hill, 58 Gin Ltd of Haggerston and the Copper Rivet Distillery in Chatham – were now helping the force. The sanitiser was being made to a formulation by the World Health Organization. The force said another company approached – Budweiser Brewing Group – was donating 6,000 litres of its own supplies of hand sanitiser free of charge.

Mark Roberts, the Met’s director of commercial services, said hand sanitiser was an “essential item” for the force’s officers and staff.

“I am extremely grateful to all of the suppliers who have agreed to work with us and provide us with this vital commodity, which will help prevent the spread of Covid-19 and ultimately save lives,” Mr Roberts said.

Border restrictions hit Macau’s gambling sector

Primrose Riordan in Hong Kong

Wynn Macau said the Chinese territory’s junket operators are likely to face liquidity problems as it reported a 19 per cent drop in net profit for 2019 to HK$5.06bn (US$650m) from HK$6.25bn the year before.

While casinos have re-opened, Macau and Hong Kong have introduced various border restrictions which have slowed the flow of gamblers into the city.

“These factors may cause gaming promoters to face a decrease in liquidity, limiting their ability to grant credit to their patrons, and difficulty in collecting credit they extend,” the casino operator said in a filing to the Hong Kong stock exchange.

Wynn Macau said its VIP gaming business had also decreased in 2019, and the total VIP table games turnover was down over 30 per cent from HK$931bn in 2018 to HK$637bn last year.

Unemployment falls in Germany up to March 12

Martin Arnold in Frankfurt:

The number of unemployed people in Germany fell slightly over the past month, but the federal employment agency said its jobs data missed much of the impact from the coronavirus pandemic as it only measured up to March 12.

The agency said the number of unemployed people fell by 60,000 to 2.34m between February and March. After adjusting for seasonal fluctuations, it said the fall in jobless people was only 1,000 and the unemployment rate dropped from 5.3 to 5.1 per cent.

It warned that the shutdown of much of Germany’s economy to slow the spread of coronavirus would leave “clear traces in all areas of the economy”.

Most German companies have put hiring plans on hold and many of them are planning to lay off workers because of the coronavirus crisis, according to the Ifo institute in Munich which said last week that its employment barometer had fallen by a record amount from 98 in February to 93.4 in March, the lowest level in a decade.

But analysts are divided on how much the country’s short-term work subsidy scheme will cushion the blow. The German government has predicted that more than 2m workers will be put on Kurzarbeit, or shorter work-time, which allows companies to send workers home or radically reduce their hours while the state replaces a big chunk of their lost income.

The federal employment agency said on Tuesday that based on a preliminary estimate, there were 108,000 employees receiving short-term work allowances under the Kurzarbeit scheme in January, up from 89,000 in December and 42,000 a year ago.

Aldi to ease purchase caps in UK stores

Jonathan Eley in London

Aldi said it is easing limits on most of the products in its UK stores in a further sign that retail food supplies are back to normal after a sudden spike in demand in the wake of the coronavirus outbreak.

The German-owned discounter, which has over 800 stores in the UK, was the first to limit items across all product lines.

It will continue to restrict shower gel, bleach, toilet and kitchen rolls, nappies, pasta, tinned tomatoes and beans, part-baked bread and alcohol to four items per customer.

Hand sanitiser, UHT milk and baby milk remains limited to two items per customer.

“While we would still encourage people to buy only what they need, product availability in store is good and the move will make it easier for people to shop for vulnerable people and those who are self-isolating,” it said.

US posts biggest daily case rise of any country

Steve Bernard in London

The US has recorded the biggest daily rise in cases of any country since the coronavirus outbreak began in December, even as the rate slowed, as it added more than 20,000 cases on Monday.

Its daily rate of growth slowed to 14 per cent from 16 per cent on Sunday.

Worldwide 61,404 people were diagnosed with Covid-19, bringing the total to 786,876. The global death toll increased by 3,723, as coronavirus claimed 37,839 lives.

Italy recorded a significant drop in new cases, adding 4,050, the lowest rise for 13 days. Spain continues to struggle with the outbreak with the death toll rising by 913 to 7,716. It added 7,846 new cases after four days of falling daily numbers.

New recoveries rose by a record 14,075 on Monday, bringing the total number of people free from the virus to 165,387.

Vietnam to impose two-week lockdown

John Reed – Bangkok

Vietnam will from midnight implement a 15-day national lockdown, under a directive issued by Prime Minister Nguyen Xuan Phuc on Tuesday.

Under mandatory social distancing rules, people will be required to maintain a distance of at least 2 meters from others, and allowed to leave home only to buy food or medicine or in an emergency.

Gatherings of more than two people will be prohibited except in public offices, schools and hospitals.

Vietnam’s communist government has taken aggressive steps to contain the disease since reporting its first cases in January. The country has recorded 204 Covid-19 infections and no deaths to date.

Rate of new cases in Germany slows even as death toll rises

Tobias Buck in Berlin

Germany is slowing the rate of new coronavirus infections, while the number of fatalities has risen, figures suggest.

The country reported 4,615 new coronavirus cases in the past 24 hours, taking the number of confirmed infections to 61,913 since the start of the crisis, the latest data released by the Robert Koch Institute on Tuesday revealed.

This was the third day in a row that the number of new infections rose by less than 10 per cent. For much of last week, the growth rate was around 15 per cent and, before that, it was closer to 20 per cent.

The number of Covid-19 deaths jumped from 455 on Monday to 583 on Tuesday. That leaves Germany’s fatality rate substantially below that of other European countries.

Germany has had 66,885 coronavirus cases, and 645 deaths, shows Johns Hopkins University, which keeps a global tally of cases. The difference from Germany’s official count reflects delays in the flow of data from local health authorities to the Robert Koch Institute in Berlin.

Ukraine changes law to meet IMF demands

Roman Olearchyk in Kyiv

Ukraine’s parliament has given citizens the right to sell farmland, meeting one of two conditions needed to unlock an $8bn IMF loan programme that will be key to stabilising the economy during the Covid-19 pandemic.

MPs voted for the legislation late Monday while wearing masks, protective eyewear and gloves. Citizens, from next summer, will be able to buy up to 100 hectares from plots given to villagers years ago.

Villagers were given the land in the 1990s, but a moratorium prohibited them from selling their land. With this law, they can sell their land to farmers who could group the smaller plots into bigger plots and farm more efficiently. The right to sell land gives villagers the opportunity to use the land as collateral for loans.

MPs on Monday preliminarily approved banking legislation, the other condition required for an IMF programme, which would open the door to additional multi-billion-dollar support from foreign backers including the EU, World Bank and European Bank for Reconstruction and Development.

Virus takes toll on mental health in Iran

Najmeh Bozorgmehr in Tehran

Iranian couples have been contacting Iran’s state mental health helpline three times more frequently than before the coronavirus outbreak, an official said on Tuesday.

“Under coronavirus conditions, we receive 4,000 telephone calls every day from 8am…over arguments such as hygiene issues or when one of the couples go out… or how to raise kids,” said Behzad Vahidnia, director general of psychological affairs. “Children react differently, demonstrating impulsive behaviours and hyperactivity which add to tensions in the families.”

Iran’s health ministry has urged couples to practice more patience during self-isolation as public concerns rise about the socio-economic consequences of Covid-19 which has so far claimed 2,757 lives in the country and inflicted heavy economic damage.

Iran’s vice-president for economic affairs, Mohammad Nahavandian, said on Monday that the spread of the respiratory illness could cause Gross National Product to fall by up to 15 per cent, if it is not curbed within a few months.

India seals off New Delhi ghetto found to be spreading virus

Amy Kazmin in New Delhi

Indian authorities have sealed off a crowded Muslim ghetto in New Delhi, from which followers of an evangelical Muslim sect have carried coronavirus to many different parts of the country.

Police have established a strict cordon around Nizamuddin West, where the Tablighi Jammat – a powerful movement of Islamic proselytizers, who encourage Muslims to practice their faith more rigorously – has its large headquarters, which doubles as accommodation for hundreds of missionary volunteers.

Indian authorities say the Tablighi held a huge conference – with around 1,800 people, including some foreign preachers from Southeast Asia – in mid-March just days before India imposed a nationwide lockdown.

Volunteer preachers from across India came to Nizamuddin to participate in the conference. After returning to their homes, many have fallen ill, and infected others in their own communities. Cases ranging from Jammu and Kashmir in the north and Telangana in the South have been traced back to the conference.

Authorities have found that 24 people still living in the crowded Tablighi headquarters were confirmed as infected, with hundreds of others in the building and residents of the nearby areas also showing symptoms. Overnight, hundreds of people were bussed out of the crowded neighbourhood and taken to hospitals and other facilities for observation and testing.

European markets gain ground

European markets opened with a bounce on Tuesday, as investors weighed upbeat data on China’s factory sector, which suggested the economy was reemerging from its paralysis and fuelling hopes of a similar rebound elsewhere once the crisis eases.

The benchmark Europe Stoxx 600 was up 1.4 per cent after the opening bell. The German Dax gained 1.9 per cent, while the French Cac 40 and London’s FTSE 100 gained 1.6 and 1.4 per cent, respectively.

US stocks also pointed towards positive moves when they open later in the day, with S&P 500 futures up 0.8 per cent.

BA to halt flights in and out of London Gatwick

Tanya Powley in London

British Airways has stopped flying from Gatwick Airport and will consolidate its London flight operations at Terminal 5 from Heathrow Airport.

It comes as airlines are looking at ways to cut costs as they battle the industry’s worst crisis in decades.

BA’s last flight from Gatwick was on Monday and there will be no more flights from the London airport until May.

The airline temporarily closed its operations at London City airport last week.

BA said:

Due to the considerable restrictions and challenging market environment, like many other airlines, we will temporarily suspend our flying schedule at Gatwick and London City, and have consolidated our operation at Heathrow.

We are contacting affected customers to discuss their options.

Covid-19 concerns prompt Britons to stock up

Jonathan Eley in London

British consumers spent almost £2bn extra at supermarkets during the four weeks ending March 21, boosting their sales by a fifth.

“Total till roll” data from Nielsen, which measures spending on groceries and personal goods such as toiletries, showed that the week ending March 21 was the peak, with sales up 43 per cent.

It was during this week that buying switched from tinned and dried products to meat and poultry. Frozen food sales rose 84 per cent in the week, while the closure of pubs and restaurants drove alcohol sales 67 per cent higher.

Panic buying was the exception rather than the rule.

“Shoppers typically added just one extra item to their basket during each shopping trip,” it said. Average basket sizes rose just £1 to £16 over the four weeks.

But shoppers made an average of three additional trips in the same period, which added up to 79m extra visits to stores.

Shell warns of ‘significant uncertainty’ on crude prices and demand

Anjli Raval in London

Royal Dutch Shell said it expects “significant uncertainty” on crude prices and oil demand as a result of the coronavirus outbreak.

The energy major said on Tuesday that “global developments” on oil supply – namely a Saudi Arabia-led price war – “have caused further volatility in commodity markets”.

The company, ahead of its first quarter earnings, said new oil price assumptions would lead to a post-tax impairment charge of $400m to $800m.

Shell noted it takes a $6bn cash flow hit for every $10 a barrel movement in the Brent crude price. Yet it warned this was mostly applicable “to smaller price changes than we currently witness”.

The company did not disclose its new price assumptions. Brent crude this week fell to its lowest since 2002.

Still, Shell said its liquidity remains strong and it had financial flexibility in the form of two new credit facilities. Together with cash of around $20bn, available liquidity will rise from $30bn to more than $40bn, it said.

Corporate round-up: Galliford Try, Smiths Group

Here’s a round- up of companies reporting updates this morning:

Galliford Try: UK housebuilder has postponed its interim dividend and will consider paying it with the final one. It said it will not be providing guidance for financial years ending June 30 2020 and June 30 2021.

Smiths Group: The UK engineering group is withdrawing guidance for its fiscal year 2020. It is delaying the spinoff of its medical unit. It said: “Moreover, Smiths and Smiths Medical need to focus on navigating the external challenges – including the delivery of ventilators and other critical care devices. Therefore, the board has decided to delay separation until conditions improve. The intent to separate remains unchanged.”

Imperial Brands: The tobacco group announced a €3.5bn multi-currency revolving credit facility, which will be coordinated by NatWest, Santander and SMBC and is provided by a syndicate of 20 banks. It provides the business with committed bank financing until March 2023 and replaces the existing about £3bn facility.

Domino’s Pizza has appointed Dominic Paul as its chief executive, with effect from April 6. He will join the board on May 1.

UK stocks poised for worst quarter since 1987

London’s benchmark stock index has shed a quarter of its value over the past three months, leaving it on track for its biggest dive in more than 30 years.

The FTSE 100 has dropped 26 per cent since the end of last year as of Monday’s closing level, the sharpest quarterly decline since the final quarter of 1987. The pan-European Stoxx 600 gauge has recorded a drop of a similar magnitude and is also set for its heaviest rout since the same three-month period in 1987.

“The first quarter of 2020 has undoubtedly been eventful with an initial stock market record that quickly turned into a bear market,” said Daniel Bergvall, economist at SEB.

Futures trading on Tuesday pointed to a tepid open for both indices as traders weigh whether intense stimulus measures from governments and central banks around the world will be sufficient to prop up the global economy.

A survey on China’s large manufacturing sector pointed to a stabilisation in March after a historic contraction in the previous month prompted by lockdowns across the country meant to halt the spread of Covid-19.

“The shape is almost a perfect V and offer a glimpse of hope that economic effect might be short lived,” said Mr Bergvall. He noted, however, that the survey “does not indicate that everything is normal, just that things are better than before.”

News you might have missed

Samsung Electronics confirmed that an employee at one of its computer chip manufacturing facilities has tested positive for coronavirus.

New York’s Attorney General called for an investigation into the sacking of Chris Smalls, an Amazon worker who helped organise a protest at the firm’s warehouse facility in Staten Island, New York.

China’s manufacturing sector rebounded to expand in March, government data showed on Tuesday, after falling sharply in February as work came to a halt in most of the country.

South Korean factory production contracted in February at its quickest rate since the global financial crisis, hit by falling demand and production disruptions linked to the impact of the coronavirus.

Newly popular video chat app Houseparty said on Monday that it was offering a $1m bounty for evidence that viral rumours that it had been hacked were in fact part of a “paid smear campaign”.

Coronavirus risks pushing emerging Asian economies into recession

John Reed in Bangkok

Coronavirus will knock almost 4 percentage points off gross domestic product growth in emerging Asian economies this year in a best-case scenario, the World Bank has warned.

The disease risks pushing the region into recession, and could force up to 11m people into poverty, the bank said in a report on Tuesday.

In an unusually bleak update of its regular survey of developing Asia-Pacific economies, the Washington-based institution said that Asian countries “now face the prospect of a global financial shock and recession”.

“First this region was recovering from trade tensions, then it was struggling on its own with a viral disease, and now it faces the prospect of a third shock — an unprecedented [economic] shock, and it could increase poverty across the region,” Ergys Islamaj, a World Bank senior economist, said ahead of the report’s release.

Read more here

Hong Kong Monetary Authority warns on loan portfolios

Primrose Riordan reports from Hong Kong

Hong Kong’s defacto central bank has said the territory’s banking sector needs to address how risks such as the virus outbreak could affect the asset quality of their loan portfolios.

The Hong Kong Monetary Authority said the city was vulnerable to the impact of a number of events apart from the pandemic, including the US-China trade tensions and the local political crisis which started last year.

“Banks should carefully assess how the possible intensification of these risk factors could impact the asset quality of their loan portfolios particularly when the levels of corporate leverage and household debt-servicing burdens have been rising,” the HKMA said in its March report.

The authority also said the unemployment rate could rise “even faster” than it did in Hong Kong during the 2003 SARS outbreak due to the higher percentage of workers in the tourism sector and the greater reliance of the retail sector on tourism.

China delays university entrance exam by 1 month

Christian Shepherd in Beijing

China has delayed its notoriously competitive university entrance exam by one month, as coronavirus has kept many schools across the country closed since January.

With the exception of Beijing and central Hubei province, high school seniors will now sit the nationwide exam known as the gaokao in July, giving students an additional month to prepare, China’s education ministry announced on Tuesday.

Dates for the exam to take place in Hubei, the province where the outbreak has been most severe, and the capital of Beijing will be announced at a later date, the ministry said.

Schools in more remote areas of China with fewer confirmed Covid-19 cases, such as Xinjiang and Qinghai in China’s northwest, have in recent weeks allowed exam-year students to return to class. Larger cities like Beijing and Shanghai have kept instruction online.

China’s college entrance exam, which was taken by over 10m students in 2019, is a national obsession. It is often considered the most challenging and nerve-wracking experience of a Chinese person’s life.

A student that scores top marks in the exam can secure a highly sought-after spot in one of China’s elite universities, bolstering prospects of finding a well-paid job, while low marks can mean a drastic narrowing of future prospects.

Chinese families have in recent years often protested any changes to the exam that are perceived to disadvantage their children.

Human rights group warns internet shutdowns could prove ‘deadly’

John Reed in Bangkok

The internet shutdowns imposed by authorities in India, Myanmar, Bangladesh, and other countries could prove “deadly” during the Covid-19 pandemic, and governments should lift them immediately, Human Rights Watch said on Tuesday.

“During this global health crisis, shutdowns directly harm peoples’ health and lives, and undermine efforts to bring the pandemic under control,” Deborah Brown, a researcher with the New York-based organisation said.

Access to timely and accurate information is crucial during a health crisis, the group said.

Internet shutdowns have become increasingly common during elections, anti-government protests, and armed conflicts. Myanmar’s government is blocking the internet for more than 1m people in Rakhine and Chin states, where its military is fighting against ethnic armed groups.

In neighbouring Bangladesh, an internet blackout and phone restrictions have been imposed at camps housing Rohingya refugees, which Human Rights Watch said was “hindering humanitarian groups from addressing the Covid-19 threat.”

India has had the most internet shutdowns of any country, according to the group, with at least 385 ordered since 2012.

Houseparty offers $1m reward to trace hacking rumours

Hannah Murphy in San Francisco

Newly popular video chat app Houseparty said on Monday that it was offering a $1m bounty for evidence that viral rumours that it had been hacked were in fact part of a “paid smear campaign”.

The Silicon Valley company, which has exploded in popularity in recent weeks among young people under government lockdown looking to chat and play games with friends, said in a tweet that it was “investigating indications that…recent hacking rumors were spread by a paid commercial smear campaign to harm Houseparty”.

It added that it would give a $1m bounty “for the first individual to provide proof of such a campaign”.

Earlier on Monday, some users had started complaining on social media that their PayPal, Netflix, and Spotify accounts were hacked, blaming Houseparty.

The company, which was acquired by Fortnite developer Epic Games last year, said that it had found no evidence of a breach.

India’s biggest e-commerce businesses resume services in cities

Amy Kazmin in New Delhi

E-commerce companies in India, including Amazon and Walmart-owned Flipkart, have resumed services in many cities after suspending them last week.

On its website, Amazon says it has “resumed services in select cities,” and is first “serving existing orders”. The services were suspended last Wednesday, amid confusion over India’s 21-day lockdown measures.

Despite the resumption, e-commerce companies continue to wrestle with severe challenges ranging from a shortage of delivery workers to major disruption in the transport of goods from factories to cities.

Big Basket, an online grocery store backed by China’s Alibaba, said it too had restarted services in some cities but warned that “due to a massive backlog of orders and some operational constraints, you may not find delivery slots.”

Softbank-backed Grofers said it is looking to induct new workers to help it cope with a massive surge in orders.

In a tweet, Albinder Dhindsa, Grofers founder and CEO, appealed to other business owners with idle, available workers to help make them available to Grofers. “If your company has idling semi-skilled workforce that can do with more income + work in a safe environment please reach out,” he tweeted. “We are hiring in our warehouses to increase in all cities.”

Meanwhile, logistics industry representatives have warned that many trucks – including some stuffed with essential goods – have been left stranded on India’s highways, as panicked drivers have fled. The flight of many migrant workers back to villages has also hindered the unloading of trucks once they arrive at their destinations, as laborers are now simply not available.

Yuanfudao raises $1bn as demand for online education soars

By Mercedes Ruehl in Singapore and Primrose Riordan in Hong Kong

Yuanfudao, one of China’s largest online education companies, has raised $1bn from investors including Tencent and Hillhouse Capital.

The fundraising, which values the company at $7.8bn, underscores how the coronavirus outbreak has boosted Asian “edtech” start-ups as millions of students have been prevented from attending school.

Yuanfudao, which offers online education products for K-12 students, said it saw a ten-fold increase in users over the past two months compared to the same period last year. The company suffered a two-hour system crash last month after 5m people took up its offer of free live courses.

It is now recruiting 10,000 people to meet the new demand. A spokeswoman for the company said 5,000 of those jobs would be in Wuhan.

Coronavirus case confirmed at Samsung chip factory

By Edward White

Samsung Electronics has confirmed that an employee at one of its computer chip manufacturing facilities has tested positive for coronavirus.

Production at the factory, located near Giheung, south of Seoul, has continued but a group of staff who were in contact with the infected person are currently self-isolating, a Samsung spokesperson said.

Samsung is the world’s largest producer of computer chips, smartphones and displays. Analysts have warned that any substantial disruption to Samsung’s chip production could wreak havoc on the South Korean economy and the global technology supply chain.

According to a person familiar with the situation, the infected employee, who worked on a semiconductor foundry line producing system chips, was diagnosed on Monday. South Korean health officials are currently assessing how the employee became infected.

The case is the first infection confirmed at a Samsung chip plant and is a worry for the tech giant which has insisted for several months that its chip-making facilities were unlikely to see disruption because production was highly automated and the factory environments are already tightly controlled with strict sanitisation measures.

The event also follows several temporary factory closures at other Samsung factories, including facilities making smartphones.

New York attorney general calls for investigation into Amazon firing

Dave Lee in San Francisco

New York’s Attorney General has called for an investigation into the sacking of Chris Smalls, an Amazon worker who helped organise a protest at the firm’s warehouse facility in Staten Island, New York.

Responding to reporting by the Financial Times, Attorney General Letitia James said the firing was “disgraceful”.

“In this midst of a pandemic,” she tweeted, “Chris Smalls & his colleagues bravely protested the lack of precautions that @amazon employed to protect them from #COVID19. Then he was fired. I’m considering all legal options & calling on the [National Labor Relations Board] to investigate.”

Amazon has said the firing of Mr Smalls was related to safety violations. “Mr. Smalls received multiple warnings for violating social distancing guidelines and putting the safety of others at risk,” the company said, adding that he had been told to stay at home, on full pay, due to close contact with a worker who later tested positive for Covid-19.

Mexico extends ban on non-essential movement

Jude Webber in Mexico City

Mexico declared a health emergency and extended a ban on non-essential movement until April 30, but stopped short of taking steps to enforce stay-at-home advice.

The ban came as the country’s health ministry reported 1,094 confirmed cases and 28 dead, a rise of 101 cases since Sunday.

Hugo López-Gatell, health undersecretary ruled out any state of exception or curfew but appealed for solidarity. “We are in the phase of rapid ascent [of cases]. We must not waste this opportunity for drastic mitigation … we’re in time … We all have to do our bit,” he said.

From April 30, the health, economy and labour ministries will draw up plans for a staggered return to work, he told a news conference. He said that at the weekend just 30 per cent of Mexicans were staying at home, but the country’s vast informal sector makes it impossible for many who live from day to day to comply with the voluntary ban.

Previously, Mexico had announced a social distancing campaign until April 19.
Mexicans aged over 60 with chronic illnesses including diabetes or who are pregnant must not go to work, even if they work in sectors deemed essential, according to the government measures. Among prominent cases, the governor of the state of Querétaro joined the governors of Hidalgo and Tabasco in testing positive for the virus.

South Korean schools move online as case numbers creep higher

By Edward White

South Korea is moving to nation-wide online school classes in April as the country struggles to fully stamp out the coronavirus.

Chung Sye-kyun, the prime minister, said that after repeated delays to the start of the new school year a decision had been made for students to begin online classes from April 9.

The move comes as health officials reported 125 new infections on Tuesday, up from 78 a day earlier and taking the total confirmed caseload to 9,786.

The daily infection rate has slowed sharply since peaking around 900 in late February but new clusters at churches, nursing homes and hospitals, as well as an increase in cases from overseas have frustrated containment efforts. The death of four people took the total death toll to 162.

The rate of recovered patients continues to outpace the infection rate, with 180 new recoveries taking the tally to 5,408.


China’s manufacturing sector expands as companies return to work

Ryan McMorrow reports from Beijing

China’s manufacturing sector rebounded to expand in March, government data showed on Tuesday, after falling sharply in February as work came to a halt in most of the country.

The official manufacturing purchasing managers’ index rose to 52.0 during the month, according to the National Bureau of Statistics, from 35.7 a month earlier.

The 50-point level separates contraction from expansion. The March reading came in well above economists’ forecasts of 45 compiled by Reuters.

After coming to a standstill because of domestic work stoppages, China’s manufacturers now face plummeting global demand as the coronavirus locks down economies across most of the world.

In a statement, China’s statistics bureau said the reading “reflects that more than half of the surveyed enterprises have resumed work and resumed production, better than last month, but it does not mean that China’s economic operation has returned to normal.”

Amazon strike leader fired following walkout over coronavirus measures

Dave Lee in San Francisco

An Amazon worker has been fired after being among the leaders of a strike over an alleged lack of protection from coronavirus held at the company’s facilities in New York state on Monday.

“Today, I stood with my co-workers because conditions at JFK8 are legitimately dangerous for workers and the public,” Chris Smalls said in a statement distributed by Athena, a workers rights group. “Amazon thinks this might shut me up, but I’m going to keep speaking up.”

Amazon confirmed the sacking, but said it was over safety violations.

“Mr Smalls received multiple warnings for violating social distancing guidelines and putting the safety of others at risk,” a spokeswoman said. “He was also found to have had close contact with a diagnosed associate with a confirmed case of Covid-19 and was asked to remain home with pay for 14 days, which is a measure we’re taking at sites around the world.”

Speaking to CNBC, Mr Smalls called the explanation “ridiculous”. The number of those participating in the strike is under dispute, with organisers claiming more than 50 walked off the job, while Amazon suggested it was 15.

Elsewhere, workers for Instacart, the app-based grocery delivery service, said they too would stop working in protest at low rates of pay and what they feel is a lack of adequate safety measures.

Instacart said it had put in place new measures to keep its shoppers safe, and to support sick workers if they are diagnosed.

“Today, we saw 40 per cent more shoppers on the platform compared to the same day and time last week,” the company said. “Over the last 72 hours, more groceries were sold on our platform than ever before.”

US government waives hospital rules to help tackle outbreak

by Hannah Kuchler

The US government is waiving many of the rules that govern hospitals, as it tries to give them flexibility to use new locations and rapidly hire staff during the coronavirus public health emergency.

Seema Verma, the administrator for the Center for Medicaid and Medicare Services, which sets rules for all hospitals and oversees government-backed insurance programmes, said the “unprecedented temporary relaxation in regulation” would help staff and providers.

The changes – dubbed ‘hospitals without walls’ – make it easier for hospitals to set up temporary locations, from doctors’ offices and urgent care centres, to student dormitories, hotels and gymnasiums.

To encourage telemedicine visits, where patients are treated remotely, Medicare will reimburse at the same rates as for in-person appointments.

As staff shortages loom, CMS is also allowing clinicians, including physician’s assistants, nurse practitioners and nurse anesthetists, to do more without a doctor’s supervision, if it does not break state law.

S Korean industrial production posts biggest fall since 2008 crisis

By Edward White

South Korean factory production contracted in February at its quickest clip since the global financial crisis, hit by falling demand and production disruptions linked to coronavirus.

Industrial output in February fell 3.8 per cent from a month earlier on a seasonally-adjusted basis, marking the biggest fall since December 2008 and a worse result than analysts expected, according to Reuters data.

South Korea’s technology and industrial exporters have been under increasing pressure since the outbreak of the virus in Wuhan in January. Initial problems were caused by falling demand and supply shortages stemming from China’s sweeping shutdowns.

In February, factories across the South Korea were forced to temporarily halt production amid a rising number of workers falling ill, including at plants owned by Hyundai, the world’s fifth-largest carmaker, and Samsung, the world’s biggest producer of computer chips, smartphones and screens.

Now as the pandemic causes a slump in consumer demand across key developed markets for South Korean products, including the US and Europe, the groups are facing more uncertainty over whether anyone will buy their products.

The government in Seoul has rolled out record economic stimulus measures and jawboning of the financial markets in a bid to shore up the economy.

China reports 48 new imported coronavirus cases

Health authorities in China have reported 48 new coronavirus cases to the end of Monday, all of which were imported cases. That takes the number of imported infections to 771. Overall, the number of confirmed coronavirus cases in China stands at 81,518.

Experts have highlighted the existence of unreported cases, particularly for patients that show no symptoms.

There was one new death linked to the virus on Monday, taking the number of fatalities in China to 3,305.

The number of people treated and discharged from hospital rose to 76,052.

Asia-Pacific stocks track Wall Street higher

Asia-Pacific stocks gained on Tuesday following a positive lead on Wall Street as the number of new coronavirus cases in some hard-hit countries slowed.

Japan’s Topix nudged 0.2 per cent higher, the Kospi in South Korea was up 1.3 per cent and Australia’s S&P/ASX 200 rose 2.6 per cent.

Overnight on Wall Street, US benchmark S&P 500 ended the day 3.4 per cent higher as healthcare stocks climbed on expectations for new coronavirus tests and a potential vaccine. The $2tn emergency stimulus fund also helped soothe fears over the economic impact of the pandemic.

Futures tip the S&P 500 to open 0.4 per cent higher when US markets reopen.

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Virgin Australia seeks $860m government rescue package

Jamie Smyth in Sydney

Virgin Australia has sought a A$1.4bn ($862m) rescue package from the government to enable it to survive the collapse in passenger demand due to the coronavirus crisis.

The airline, which has Singapore Airlines, Etihad Airways, Richard Branson’s Virgin Group and China’s HNA Group on its share register, has suggested a government loan could be exchanged for equity in the carrier if it was not paid back within three years.

It told the government the rescue package could be part of a wider aviation industry package worth about A$5bn that would ensure Australia retained healthy competition in the aviation sector following the crisis, a source close to the discussions confirmed to the Financial Times.

Qantas has said it does not need any financial assistance and raised more than A$1bn last week from debt markets to bolster its balance sheet.

The requests for financial assistance are contained in a letter from Paul Scurrah, Virgin chief executive, to the government, which was first reported by the Australian newspaper.

A Virgin spokesman told the FT the airline has been in discussions with the government about the support the whole industry will need if this crisis is prolonged.

“The support we’ve proposed will be necessary for the industry if this crisis continues indefinitely, to protect jobs and ensure Australia retains a strong, competitive aviation and tourism sector once this crisis is over,” said the Virgin spokesman.

The government has already provided A$1bn in aid to the aviation sector since the crisis began and has yet not decided on whether to provide the additional support requested by Virgin.

US capital enters loose lockdown

The Washington DC metropolitan area is entering a loose form of lockdown after authorities in the city, Maryland and Virginia issued stay-at-home orders on Monday.

Muriel Bowser, the mayor of the US capital, told residents to remain at home late on Monday afternoon following similar directives from the governors of the two states surrounding Washington DC.

“Staying at home is the best way to flatten the curve and protect yourself, your family, and our entire community from Covid-19,” she said in a statement.

Washington DC and the surrounding suburbs in Maryland and Virginia, known as the “DMV” area, are home to the majority of the US federal workforce.

Earlier on Monday, Larry Hogan, the governor of Maryland, said the number of cases in the DMV area had quadrupled in the past week to 2,709.

“A major outbreak among our critical federal workforce could be catastrophic,” he warned.


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