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Spain and France will give details on plans to ease lockdowns as Europe moves to loosen restrictions. The White House issued a strategy to expand U.S. testing, including partnering with retail chains, accelerating President Donald Trump’s push to reopen the economy.
China’s top scientists said the novel coronavirus will not be eradicated, joining a growing consensus that the pathogen will likely return in waves, as global cases passed the 3 million mark. The number of new infections in Germany fell below 1,000 for the first time in more than five weeks.
Earlier, HSBC Holdings Plc cautioned bad loan charges may climb to as much as $11 billion this year and Banco Santander SA reported the highest provisions by a bank in continental Europe so far this quarter.
Key Developments
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U.K. Plans Gradual Lockdown Exit (4:10 p.m. HK)
Amid renewed calls for restrictions to be lifted, Health Secretary Matt Hancock said it is still too soon to end the lockdown safely. Moving too early will risk a second spike in infections that the government says would cause many more deaths and “economic disaster.”
“The worst thing for the economy would be for it to continue rattling away,” Hancock said as he answered questions from the public on LBC Radio on Tuesday. “We do have to get the level of new cases right down and then we can hold it down through testing, tracking and tracing. It is a catastrophe and we’re trying to manage it as best we possibly can.”
Russia Surpasses Iran in Total Cases (3:55 p.m. HK)
Confirmed cases rose by 6,411 to 93,558. Russia now has more cases than Iran, which is the worst-hit country in the Middle East. The number of new daily cases was up slightly from 6,198 on Monday when Russia passed China in total registered cases.
Outbreak Continues to Slow in Austria (3:51 p.m. HK)
The spread of coronavirus in Austria has continued to slow even after the country started easing lockdown measures two weeks ago. The reproduction factor -- known by epidemiologists as R-naught -- fell to 0.59, Health Minister Rudolf Anschober told journalists.
That will allow the government in Vienna to let some of the most onerous lockdown measures expire this week. People will again be free to leave their homes and meet in public whenever they like, rather than having to provide a specific reason for doing so, Anschober said. However, they will still have to keep at least 1 meter away from each other, wear face masks in stores and on public transport, and gatherings will be limited to 10 people.
Olympics May Be Canceled if Virus Isn’t Controlled (3:41 p.m. HK)
The Olympic Games would be canceled instead of being further postponed if the coronavirus pandemic isn’t under control by 2021, the head of Tokyo’s organizing body said. Yoshiro Mori, president of the Tokyo 2020 organizing committee, told Nikkan Sports that a delay to 2022 wouldn’t happen, noting that during wars, the games have simply been canceled.
Just weeks after agreeing to postpone the games to 2021, Japan and the International Olympic Committee have in recent weeks given conflicting statements about the prospect of a further delay to the games, as well as seeming to disagree on who would bear the extra costs from the delay.
Riksbank May Cut Below Zero (3:49 p.m. HK)
Sweden’s central bank left its main rate at zero, as expected by most economists, but said it may need to cut below zero as policy makers agree that the crisis triggered by Covid-19 calls for extraordinary support measures.
Governor Stefan Ingves has repeatedly downplayed the need to return to negative rates after bringing five years of the policy to an end in December. Instead, the bank has dramatically expanded an existing bond-purchase program and created cheap bank loans to prevent a credit crunch.
Sweden already stands out for its overall approach to Covid-19, which has been more relaxed than in other countries. Though its death rate is now higher than elsewhere in Scandinavia, it’s well below levels in the U.K. and Italy, both in absolute and relative terms.
Duterte May Gradually Restart Economy (3:33 p.m. HK)
President Rodrigo Duterte may gradually reopen the Philippines economy after a lockdown on key economic centers ends in mid-May, his spokesman said. The lockdown imposed in Metro Manila and central and southern Luzon provinces since mid-March will be relaxed eventually, “but not anytime before May 15,” Harry Roque said.
Duterte on Monday night said the lockdown will only be modified becasue lifting it completely may cause more infections. The government plans to allow construction and other sectors to gradually restart, making sure that social distancing remains.
Pandemic Hinders Novartis Research (3:25 p.m. HK)
A study evaluating a Novartis AG cholesterol drug stopped enlisting patients due to Covid-19, a sign the pandemic is hampering research. The Swiss drugmaker has paused new enrollment in a large U.K. clinical trial called Orion-4 that’s evaluating the experimental heart drug inclisiran, Chief Executive Officer Vas Narasimhan said in a Bloomberg Television interview. The medicine, a potential blockbuster, was central to Novartis’s $9.7 billion takeover of Medicines Co. last year.
Separately, the company maintained its sales and profit forecasts for this year as demand for its medicines held up. Goldman Sachs said Novartis was boosted by patients stockpiling cancer drugs Gleevec and Tasigna, as well as multiple sclerosis medication Gilenya.
Vas Narasimhan, chief executive officer at Novartis AG, discusses the impact of coronavirus
Markets: European Open.” (Source: Bloomberg)
Wuhan Tests Show Antibody Results (3:20 p.m. HK)
Antibody test results are emerging in Wuhan, the Chinese city where the pandemic is thought to have started in late 2019.
A hospital in the city’s Qingshan district tested more than 1,400 people not known to have been infected with the coronavirus for the immune proteins that indicate past exposure to the pathogen. Almost 10% of results were positive in tests conducted from April 3 to 15, indicating individuals who probably recovered from an asymptomatic SARS-CoV-2 infection.
The study, published April 20 in the Journal of Medical Virology, will require large-scale research to evaluate the extent of immunity to the pneumonia-causing virus in the city, the authors said
Earnings Roundup (2:04 p.m. HK)
BP Plc’s profit fell by two thirds in the first quarter as the nascent coronavirus pandemic hammered energy prices and demand and Capgemini became the latest company to lower its dividend and scrap its outlook for the year. However, Delivery Hero SE, the German food delivery company, said orders rose 92% in the first quarter, nearly doubling from a year earlier as customers were forced to stay home and order takeout online. For more on European earnings, click here.
In Japan, Nissan Motor Co. warned that profits for the just-ended fiscal year may be more than 30% lower than forecast, as it delayed its earnings report.
Germany’s New Cases Drop Below 1,000 (1:32 p.m. HK)
The number of new coronavirus cases in Germany fell below 1,000 for the first time in more than five weeks while the daily death toll picked up slightly, as the nation considers a further cautious easing of restrictions on public life.
Fatalities rose by 150 to 6,126 in the 24 hours through Tuesday morning, compared with Monday’s increase of 99. There were 988 new infections, the lowest since March 19, bringing the total to 158,758, the fourth highest in Europe.
Chancellor Angela Merkel is due to consult with state premiers on Thursday on the next steps in tackling the pandemic. Lower Saxony Premier Stephan Weil on Monday warned against expecting too much, saying it’s too early to know what impact the initial easing of curbs has had on infection numbers.
HSBC, Santander, UBS Deal With Loan Losses (12:29 p.m. HK)
Watch: HSBC CFO Stevenson discusses credit losses, the impact of coronavirus on the business, the suspension of dividends and the recovery in H.K. and China.
(Source: Bloomberg)
HSBC Holdings Plc took its biggest charge for bad debt in almost nine years as the coronavirus outbreak roiled the economies of its main markets. Banco Santander SA reported the highest provisions by a bank in continental Europe so far this quarter as it attempted to put a number on potential loan losses caused by the coronavirus outbreak. UBS Group AG, meanwhile, expressed confidence in its ability to withstand a surge in bad loans because of the coronavirus, while warning that the outbreak will put pressure on key streams of income at its wealth management business.
Some Hope for Airlines as Capacity Picks Up (12:21 p.m. HK)
Scheduled airline capacity rose for the first time in nearly 10 weeks as some countries begin to ease coronavirus lockdown restrictions, with a 2% increase in seats this week, according to OAG Aviation Worldwide.
“Whisper it quietly but we may have reached the bottom,” senior analyst John Grant wrote in a weekly blog. “Reassuringly those green shoots of recovery are in more than one market.”
U.S. Makes Rare Nod Toward Taiwan With Virus Call (12:13 p.m. HK)
The top U.S. health official spoke to his Taiwanese counterpart about fighting the coronavirus outbreak, a rare Cabinet-level contact between the two governments that’s certain to anger Beijing.
Health and Human Services Secretary Alex Azar discussed giving Taiwan a bigger role in the global fight against Covid-19 in a telephone call with health minister Chen Shih-chung Monday. The two also discussed U.S. support for Taiwan’s inclusion in the World Health Organization, according to a summary of the meeting released by Taiwan’s foreign ministry.
The 30-minute phone call signals a strong display of support for Taiwan given that successive U.S. administrations have limited high-level contacts. Relations between the U.S. and China, already strained under President Donald Trump, have worsened further as a result of the outbreak, with American officials accusing China of refusing to cooperate in fighting the virus.
California Activists Fight Stay-at-Home Order (12:09 p.m. HK)
Two California activists claim a ban on non-essential activities is infringing on their right to protest at the State Capitol Building. Ron Givens, a gun store employee in Sacramento, and Christine Bish, a Republican candidate for the U.S. House of Representatives, sued Governor Gavin Newsom and other state officials Monday seeking a judgment that the state’s stay-at-home order is unconstitutional.
Separately, an Illinois judge ruled that Governor J.B. Pritzker’s stay-at-home order violated the liberty of a state lawmaker who sued to block the measure, signaling potential legal hurdles for extended periods of social distancing.
Virus Is Here to Stay and Likely Seasonal: Scientists (11:05 a.m. HK)
China’s top scientists said the novel coronavirus will not be eradicated, joining a growing consensus around the world that the pathogen will likely return in waves like the flu.
It is unlikely for the new virus to disappear the way its close cousin the SARS virus did 17 years ago, as it infects some people without causing obvious symptoms like fever. This group of asymptomatic carriers makes it hard to fully contain transmission as they can spread the virus undetected, a group of Chinese virus and medical researchers told reporters in Beijing at a briefing on Monday.
It is unlikely for the new virus to disappear the way its close cousin the SARS virus did 17 years ago, as it infects some people without causing obvious symptoms like fever. This group of asymptomatic carriers makes it hard to fully contain transmission as they can spread the virus undetected, a group of Chinese virus and medical researchers told reporters in Beijing at a briefing on Monday.
A consensus is forming among top researchers and governments that the virus is unlikely to be eradicated, despite costly lockdowns that have brought much of the global economy to a halt.
Singapore Boosts Testing Capacity as Infections Jump (10:53 a.m. HK)
As part of Singapore’s strategy to bring down coronavirus infections in the weeks to come, the government said it has more than doubled its daily testing capacity since early April as the number of cases jumped beyond 14,000.
The city-state now has capacity to conduct more than 8,000 tests a day, up from an average of 2,900 less than a month ago, the health ministry said in a statement. To date, the Southeast Asian nation has tested about 2,100 per 100,000 persons, higher than the rates in the U.S. and the U.K.
China’s Moutai Sees Profit Gain Despite Lockdowns (10:23 a.m HK)
Kweichow Moutai Co. reported a gain in profit for the first quarter as demand for its popular baijiu liquor held up in the face of lockdowns that kept people from social gatherings during the coronavirus outbreak.
The results come amid some of the most challenging conditions Moutai has faced. Yet scarcity of the high-end baijiu helped keep demand strong. Consumers still sought out Moutai’s fiery liquor, which has become the toast of China’s elite and is highly coveted by the growing middle class.
Hong Kong Preparing to Re-Open Public Facilities (10:06 a.m. HK)
Hong Kong government employees will start returning to work May 4 and the city is preparing to reopen public facilities that have been closed during the coronavirus pandemic, leader Carrie Lam said. Authorities have yet to decide whether to extend social distancing measures beyond May 7, Lam said at a regular briefing ahead of a meeting of her advisory Executive Council, as the city continues to see success containing daily Covid-19 infections.
— With assistance by Adveith Nair, and Boris Groendahl
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