The Premier League has wrapped up negotiations to provide a £250m rescue package for English Football League clubs struggling to survive without fans at matches for most of the year.
Shareholders in football’s most lucrative domestic league agreed to provide £50m in grants for League One and Two clubs, England’s third- and fourth-highest divisions of the sport, £30m of which will be paid out to all 48 clubs and the remainder available through monitored applications.
The top-flight league agreed to assist the EFL by paying up to £15m to cover interest payments on a £200m loan facility that Championship clubs in the division below the Premier League can use to cover liabilities running to the end of June next year.
“The Premier League is a huge supporter of the football pyramid and is well aware of the important role clubs play in their communities,” Richard Masters, Premier League chief executive, said on Thursday. “Our commitment is that no EFL club need go out of business due to Covid-19.”
The lack of fans at matches has drained revenues from clubs across the country.
The government has recently permitted supporters to return to stadiums for professional sports matches in England, with up to 4,000 people being allowed into sports grounds in the regions under the least strict of three bands of restrictions.
“With a £250m support package for men’s elite football and £300m government funding for women’s football, the National League and other major spectator sports, we have fuel in the tank to get clubs and sports through this,” said Oliver Dowden, culture secretary.
US retailer Dollar General has had another blockbuster quarter on the back of demand from newly frugal shoppers for low-cost food and cheap general merchandise.
While foot traffic declined, customers spent a lot more on each trip, pushing third-quarter net sales up 17 per cent from the same period a year ago to $8.2bn.
The Tennessee-based company, which has about 17,000 stores across the US, opened another 780 outlets during the period. It plans another 1,000 next year.
All food stores have benefited in recent months from a huge shift in spending patterns, as fewer consumers have dined out during the pandemic. Kroger, the US supermarket chain, on Thursday posted a 10.9 per cent rise in third-quarter like-for-like sales, excluding fuel. Yet Dollar General’s performance also reflects constrained budgets among households that have struggled with the economic effects of the pandemic.
The company said sales had also risen in clothing, homewares and several other non-food categories. Net income jumped from $366m a year ago to $574m.
New US jobless claims fell more than expected last week while remaining at historically high levels, as some states reimpose curbs on businesses in response to record increases in coronavirus cases and hospitalisations.
Initial applications for unemployment benefits dropped to a seasonally adjusted 712,000 from 787,000 in the prior week, the US labour department said on Thursday. That was lower than economists’ forecast of 775,000 claims, and nearly even with a pandemic-era low of 711,000 recorded earlier this month.
The number of Americans actively collecting state jobless aid totalled 5.5m in the week that ended on November 21, compared with 6.1m the week before and a consensus estimate of 5.9m. Continuing claims have fallen from 12.7m in mid-September, although economists have partly attributed the decline to unemployed workers exhausting regular benefits.
The insured unemployment rate, considered an alternative measure of joblessness, fell to 3.8 per cent from 4.2 per cent.
Eric Platt in New York
There will be no Woodstock for capitalists in 2021.
Warren Buffett’s Berkshire Hathaway has cancelled the in-person events tied to its annual general meeting in Omaha planned for next May, a gathering that typically draws tens of thousands of shareholders who hope to glean pieces of investing advice from the famed 90-year-old.
The company will instead stream a question-and-answer session with Mr Buffett on Yahoo. It was unclear which Berkshire executives would join the nonagenarian to answer questions.
This year, Mr Buffett and Berkshire vice chair Greg Abel were the ones to take questions from an empty stage at the CHI Health Center in downtown Omaha, seated apart to conform with social distancing standards.
“We hope that the 2021 meeting will be the last time that shareholders are unable to attend in person,” the company said in a statement. “We look forward to 2022 when we expect to again host shareholders in Omaha.”
The pandemic has weighed on Berkshire’s performance, with the operating profits of the dozens of businesses the company owns down 14 per cent for the first nine months of the year. Net income, which is swayed heavily by the vagaries in the stock market, has collapsed 87 per cent.
England has reported fewer positive coronavirus cases in the latest weekly figures, raising hopes that the national lockdown that ended this week has slowed the infection rate.
About 110,000 people tested positive for coronavirus in England in the week to November 25, a 28 per cent drop over the previous week and the lowest since early in October, the latest NHS Test and Trace figures showed on Thursday.
However, the number of positive tests remains high compared with the lower levels of infection in August. About 13 times more people entered the contact tracing system than at the end of that month, the Department of Health and Social Care said.
The number of contacts reached rose markedly but this was largely due to a technical modification. 72.5 per cent of contacts were reached, up from about 60 per cent a week earlier.
The main reason for the improvement was the system now counts under-18s as having been contacted if their parent or guardian confirms that they have told their child to self-isolate, as opposed to having to talk with the child directly.
England adopted a three-tier system of coronavirus rules on Wednesday when it emerged from a four-week lockdown.
The World Health Organization has warned of the dangers of misinformation, calling the promise of coronavirus vaccines “phenomenal” and reflective of a “brighter” future, as countries prepare to approve a number that are under development.
“The reward is potentially game-changing,” Europe’s top WHO official said, with most people remaining “susceptible to the virus”.
However, Hans Kluge reminded people to seek reliable information from trustworthy sources before making a decision on inoculation against coronavirus.
“Don’t be part of a misinformation pandemic,” the European regional director said on Thursday at a WHO briefing. “Vaccination saves lives. Fear endangers them.”
Infections have surged in central and southern Europe during a second wave of Covid-19 that has made that region among the hardest hit, he said on Thursday.
“These reports are of grave concern,” Dr Kluge said.
Europe accounts for two-fifths of recently registered global cases and half of the latest deaths even as infections declined last week for the third consecutive week. The continent has reported more than 19m cases of Covid-19 and about 427,000 deaths, with more than 4m cases last month, Dr Kluge said.
He stressed “the future looks brighter” on the news of vaccine trial results in recent weeks as well as more than 200 vaccine candidates under development.
WHO is recommending that health and social workers, adults over 60 years old and residents of long-term care facilities should be top of the list for coronavirus vaccine access.
The Brazilian economy rebounded strongly in the third quarter, bolstering hopes among policymakers that the country’s performance during the coronavirus crisis will be better than initially expected.
Latin America’s largest economy grew 7.7 compared with the second quarter, when in the throes of the pandemic it shrank 9.7 per cent – a contraction greater than the total loss in any of nine recessions that have struck Brazil in the past 40 years.
Compared with the same quarter last year, gross domestic product shrank 3.9 per cent and most economists now believe that the country will round out the year with an annual figure of about minus 5 per cent.
European consumers splashed out in October, driving a 1.5 per cent rise in retail sales, which outstripped the expectations of economists who predicted the latest coronavirus lockdowns would cause shopping activity to drop again in November.
The rise in EU and eurozone retail sales reversed a decline in September and meant they had risen 3.1 per cent above their pre-pandemic level in February and 4.3 per cent higher than October 2019.
Online sales were the main driver of growth, new data showed on Thursday, as mail order and internet sales increased 6.1 per cent from the previous month, while sales of food, drinks and tobacco rose 2 per cent and electrical goods and furniture sales rose 1.5 per cent.
However, sales of textiles, clothing and footwear fell 2.8 per cent and automotive fuel sales dropped 3.7 per cent.
Economists predicted that retail sales would fall again in November after many European countries introduced partial lockdowns, including closures of non-essential stores in some countries.
“The daily mobility data that we have been tracking this year show big falls in trips for retail and recreation and we doubt that this will have been entirely offset by increased spending online,” said Jack Allen-Reynolds, economist at Capital Economics.
Najmeh Bozorgmehr in Tehran
Iran’s coronavirus cases exceeded 1m since the beginning of the pandemic at a time when a partial lockdown has helped slow down the speed of Covid-19 infections.
The health ministry said the total number of people who tested positive hit 1,003,494 by Thursday noon.
Iran, with a population of 83m, is the hardest hit by the pandemic in the Middle East based on official figures. Tehran says its figures are some of the region’s most transparent.
The number of daily deaths, which exceeded 400 for almost a month, has dipped below that mark this week. On Thursday, 358 patients died over the past 24 hours. This number is expected to continue falling in the coming weeks as health authorities wait to see the results of a partial lockdown imposed over the past two weeks.
Most restrictions on travelling from one city to another and a ban on travelling by car from 9pm to 4am will continue amid concerns about a surge in the winter.
But some businesses can reopen from Saturday, although many businessmen and workers violated restrictions during the lockdown. The economy has also been struggling with the impacts of the toughest US sanctions to date.
The national headquarters to combat the pandemic said on Thursday that the speed of infection had slowed down but warned it could go up again if people failed to observe health guidelines.
“The current situation is completely vulnerable…and can quickly go back to the previous unpleasant situation,” it said in a statement. “Changes in some cities do not mean we are back to normality.”
Hannah Kuchler in New York and Hannah Murphy in San Francisco
Cyber attackers have targeted the cold supply chain needed to deliver Covid-19 vaccines, according to a report detailing a sophisticated operation likely backed by a nation state.
The hackers appeared to be trying to disrupt or steal information about the vital processes to keep vaccines cold as they travel from factories to hospitals and doctors’ offices.
The targeted organisations are associated with a cold chain platform run by the Gavi vaccine alliance, a public-private partnership for developing immunisation for poorer countries.
Many of the Covid-19 vaccines need to be kept cold to keep them from spoiling. The earliest vaccines have particularly stringent requirements: Pfizer and BioNTech’s vaccine must be kept between minus 70C and minus 80C, while Moderna’s jab needs to be transported at minus 20C.
According to the report by IBM’s threat intelligence task force, which advises companies and the public sector on cyber security, the attackers pretended to be an executive at a Chinese supplier of ultra-cold refrigeration, to mount a phishing campaign trying to obtain usernames and passwords.
Read the full story here
The UK government has announced measures to ease the strain on the transport network ahead of an anticipated surge of passengers during the five day “Christmas bubble”.
Coronavirus restrictions are to be relaxed to allow three households to mix between December 23 and December 27, coinciding with pre-planned closures of parts of the rail network for essential works.
Some minor works will be postponed, and extra services will be added on some lines, but the most disruptive work on the East Coast mainline between London, north-east England and Scotland will still go ahead.
Transport secretary Grant Shapps told MPs he expected trains to be “exceptionally busy”, the first big test of the network following a collapse in passenger numbers during the pandemic.
Nearly 800 miles of works on motorways and key roads will be also cleared, although this tends to happen around Christmas anyway.
The AA told the Financial Times last week that it was not expecting ‘Carmageddon’, pointing to a survey showing 40 per cent of its members were not planning to make their normal Christmas journey.
Valentina Romei in London
UK businesses are less pessimistic about their sales prospects for the first half of next year as news of a vaccine has reduced uncertainty, according to an official survey that highlights further deterioration in investment prospects.
Businesses expect an 11 per cent fall in sales in the first quarter of next year compared with what otherwise would have been without the pandemic, a Bank of England survey in November of nearly 3,000 chief financial officers at UK companies showed.
This is 3 percentage points higher than estimates in October. For the second quarter of next year, sales expectations were revised up 6 percentage points.
The survey was conducted between November 6 and 20 during which time positive vaccine trial data were announced by Pfizer-BioNTech and Moderna.
Businesses were also less pessimistic about the impact of Covid-19 on employment. In November, employment was expected to be 6 per cent lower in the first three months of next year than if there had been no pandemic, up 3 percentage points from October. Employment expectations for the second quarter of 2021 were revised up even further by 5 percentage points.
Businesses also reported much lower levels of uncertainty and increased levels of preparedness for the end of the transition period with the EU.
However, the brighter mood was not enough to lift investment expectations. Businesses expected the pandemic to result in 22 per cent lower investment than otherwise would have been in the first three months of next year — 6 percentage points lower than what was expected in October.
UK business investment has fallen more than other indicators of economic health this year and it has contracted more than in peer countries, limiting growth potential after the pandemic.
US and European regulators will not be “very many days behind us” in authorising a coronavirus vaccine from Pfizer and BioNTech, England’s deputy chief medical officer said as he addressed safety concerns about the speed of its development.
However, Professor Jonathan Van-Tam does not see coronavirus being eradicated even as the UK is set to initiate a vaccine programme, with care home residents and workers plus those over 80 years old to be the first in line.
Prof Van-Tam stressed he was “very confident” in assessments from the UK regulator Medicines and Healthcare products Regulatory Agency. He hoped the regulator would approve a vaccine being developed by Oxford university and AstraZeneca before Christmas,
“I have genuinely said to my 78-year-old mum: ‘you must have this vaccine or any of the vaccines that the MHRA approves as soon as they are available’,” he told a briefing on Thursday.
The Pfizer vaccine was expected to arrive in the UK within “hours, not days”, Prof Van-Tam said at the briefing, a day after the MHRA approved the vaccine from US drugmaker Pfizer and Germany’s BioNTech.
The strict storage requirements for the vaccine, including ultra deep freeze conditions, were a “technical issue” that meant it was not viable to take the vaccine to people who were housebound. However, they would be able to go to mass vaccination centres or hospitals, Prof Van-Tam said.
The vaccine developed by Oxford university and AstraZeneca could be stored at 2C-8C throughout and “is much easier to split into smaller quantities”. It “probably can go into people’s homes”, he said.
Prof Van-Tam was “hopeful” that this vaccine would be approved before Christmas. “It’s in the hands of the regulator,” he said. “We go at the speed of science on that one.”
Using a football analogy to describe the challenges ahead, Professor Van-Tam said “we’ve got to hold our nerve now, see if we can get another goal and nick it”.
“We need more vaccines, but we also need people to realise that these are not an instant ticket out of anywhere at the moment,” he added.
Aldi is the latest grocer to repay the business rates relief granted by the UK government during the pandemic, following rivals Tesco, Morrison’s and Sainsbury’s.
The UK’s fifth largest supermarket on Thursday said it would pay back more than £100m to the government, the full value of the relief it has received.
Giles Hurley, chief executive at Aldi UK, said returning the money was “the right decision to help support the nation […] despite the increased costs we have incurred during the pandemic”.
The latest month-long lockdown in England dealt a lesser blow to services activity than restrictions in the spring and initial estimates implied.
The IHS Markit services purchasing managers’ index, a measure of the sector’s economic health, fell to 47.6 in November from 51.4 the previous month, the lowest level since May.
Last month’s figure was higher than the initial estimates of 45.8 and well above the 13.4 low in April.
“Overall service sector output was still severely impacted by widespread business closures among consumer-facing service providers,” said Tim Moore, economics director at IHS Markit, which compiles the survey. “Other types of firms often commented on successfully adapting to the new lockdown restrictions and seeing a reduced impact on client spending than initially expected.”
Thirty per cent of services providers reported a monthly drop in business activity in November, compared with 80 per cent in April, when the national lockdown involved the closures of schools, factories and building sites that remained open in the Autumn.
However, the reading was below the 50 mark, which indicates a majority of businesses reporting a deterioration of activity.
Businesses taking part in the survey reported falling employment numbers with the rate of job losses accelerating to the highest in three months.
Meanwhile, positive news in relation to vaccines and hopes of a better stage ahead in the pandemic situation led to much greater levels of business optimism in November. About 60 per cent of respondents expect a rise in business activity in the year ahead.
Services account for about 80 per cent of the UK economy and the sharp drop in the services PMI points to an economic contraction in the final quarter of the year after a rebound in the three months to September.
The composite PMI index, an average of services and a better performing manufacturing sector, was revised up to 49, from 47.4 of initial estimates.
Final figures are published about 10 days after flash estimates.
The PMI services index for the eurozone also fell to a six-month low of 41.7 in November.
Global equities set another record on Thursday as hopes for further fiscal stimulus in the US outweighed concerns over rising coronavirus cases and weak economic data.
MSCI’s index of global shares added 0.2 per cent to mark a fresh all-time high after the S&P 500 set a new closing record on Wednesday. In Europe, the Stoxx 600 was broadly flat in morning trading after an almost 14 per cent gain in November.
The rally has persisted largely untrammelled despite the deepening coronavirus crisis. On Wednesday, Germany extended its partial Covid-19 lockdown until January 10, and a survey showed hiring by large US companies had slowed to its weakest pace since July last month.
Investors were cheered after top Democrats added their backing to a $908bn stimulus proposal from a bipartisan group of US senators to deliver financial aid to Americans suffering during the pandemic. This followed months of talks between Democrats and Republicans over the size and shape of a second economic bailout.
On Wednesday, Federal Reserve chairman Jay Powell and Treasury secretary Steven Mnuchin also urged lawmakers to take action to break the gridlock.
Haven assets stayed out of favour on Thursday. The dollar, as measured against a basket of trading partners’ currencies, fell a further 0.2 per cent, languishing around its weakest levels since April 2018. The dollar index has fallen almost 6 per cent this year.
The yield on the US 10-year Treasury bond held steady at about 0.94 per cent. Treasuries have sold off in recent days on concerns that fiscal stimulus would feed through to higher inflation.
Brent crude rose 0.5 per cent to more than $48 a barrel as investors waited to see whether the latest meeting of oil producers could deliver an agreement on production cuts.
Struggling airline Norwegian Air has put forward a restructuring plan including downsizing its fleet of planes and raising new money from investors that it said could “potentially” rescue it from bankruptcy.
The carrier became one of the most significant casualties of the crisis in global aviation last month when it filed for protection from creditors under the Irish equivalent of Chapter 11.
Norwegian’s board on Thursday proposed “reconstructing” the airline’s balance sheet by reducing the size of its fleet of aircraft, a debt-for-equity swap and a rights issue of up to NKr4bn ($450m).
The proposal will be set out at an extraordinary general meeting on December 17.
The board said the plan would aim to “rightsize” Norwegian’s operations at a “level of proven profitability” and could attract new investors including “potentially” support from the Norwegian state.
The centre-right government refused to offer a second bailout last month, triggering bankruptcy proceedings.
The carrier went into the crisis as one of Europe’s weakest due to a high debt level built up through an aggressive expansion plan, including low-cost long-haul flights.
It is operating a skeleton service around its home market using six or seven of its aircraft following a 91 per cent fall in passenger numbers this year.
Italy’s services activity tumbled more than expected to a six-month low in November as new restrictions resulted in extensive closures of bars, shops and restaurants.
The IHS Markit Italy purchasing managers’ index for services fell to 39.4 in November from 46.7 in October, the lowest since May.
The figure was worse the 41.3 forecast by economist polled by Reuters and it was also well below the 50 mark that indicates a majority of businesses reporting a deterioration of activity.
The fresh blow to Italy’s services industry has led to widespread jobs cut and points to a double-dip economic downturn at the end of the year.
“The Italian services sector remained mired in a downturn during November,” said Lewis Cooper, economist at IHS Markit. “Job cuts continued into November and were the most widespread since June, with the latest round of job shedding attributed to the pandemic.”
However, the fall was less pronounced than in the spring when the services PMI index reached a low of 10.8 reflecting a stricter national lockdown in March and April.
The composite PMI index, an average of services and the better performing manufacturing sector, fell to 42.7 in November from 49.2 in October.
News of a vaccine resulted in rising expectations for the year ahead. According to the report, more than two-fifths of respondents expect output to be higher by November 2021, with many linking confidence to hopes of an end to the pandemic and global economic recovery.
The final PMI services reading for the eurozone, published about 10 days after the initial estimates, was marginally revised up to 41.7, from the 41.3 of the flash figure. The contraction in services activity was common among all countries of the eurozone.
The composite eurozone PMI index was also a touch higher than initial estimates at 45.3 instead of 45.1 of the flash figure, with Germany reporting the only reading above 50, indicating an expansion, thanks to strong growth in the manufacturing sector.
Eurozone composite PMI figures for November:
Eurozone: 45.3 (flash:45:1), 5-month low
Germany: 51.7 (flash: 52.0), 5-month low
Ireland: 47.7, 2-month low
Italy: 42.7, 6-month low
Spain: 41.7, 6-month low
France: 40.6 (flash: 39.9), 6-month low
Spain’s services sector has suffered another decline in activity, underlining how the eurozone’s fourth-biggest economy has been hit hardest by the coronavirus pandemic.
The IHS Markit flash Spanish services purchasing managers’ index dropped to 39.5 in November. The fall was less than expected by most economists in a Reuters poll, which had on average forecast a decline to 36.6.
The Spanish index slid for the fourth consecutive month from 41.4 in October to set a fresh six-month low, data published on Wednesday showed.
A reading below the 50 mark indicates that a majority of businesses reported a contraction in activity from the previous month. The services sector accounts for about three-quarters of eurozone output and jobs.
“November’s PMI data confirm that the second wave of Covid-19 is having a detrimental impact on the Spanish economy, but not to the same degree as we saw earlier in the year,” said Paul Smith, economist at IHS Markit.
The results contrasted with those published this week showing activity continued to grow in Europe’s manufacturing sector, which is proving more resilient as supply chains have remained relatively unscathed and exports are rebounding.
Many services companies, such as airlines, hotels, retailers and hairdressers rely on human contact, so have been hit hardest by the restrictions on people’s social interaction and movement imposed to contain the spread of coronavirus.
Even though the new restrictions are less strict than those imposed in the spring, they are expected to cause another downturn in the eurozone economy, which remains well below pre-pandemic levels despite rebounding strongly in the third quarter.
Madison Darbyshire in London
UK investment platform AJ Bell increased profits by 29 per cent, as retail investment providers ride the wave of new clients looking to put money in volatile markets.
The platform also added a record 63,239 users in the year to September 30, a 27 per cent increase, as customers flocked to investment platforms since March. Revenue was up 21 per cent for the year, to nearly £127m.
Low fee investment platforms have been buoyed by the coronavirus pandemic, as a younger generation of cost-conscious investors look to join the markets and capitalise on dramatic falls in share prices.
Investment platforms have struggled to accommodate the high volumes of new traders, and last month AJ Bell suffered technical outages as a result of heightened trading volumes on the platform.
The FTSE 250 investment manager’s share price has risen 93 per cent since it floated in December 2018, and shares added 2.7 per cent in early trading on Thursday.
AJ Bell said net inflows on the platform were £4.2bn over the year, compared with £3.9bn in inflows a year earlier, while assets under administration rose 8 per cent to £56.5bn.
Despite record growth, analysts said retail investment platforms in the UK were uncertain how many new customers would prove loyal over the long term, and remain profitable for the providers. However, AJ Bell said it believed the pandemic had renewed public focus on taking responsibility for personal finances, and that easy-to-use investment products would continue to see growth.
AJ Bell increased its dividend 28 per cent from 2019, to a total ordinary dividend of 6.16p a share.
Farhan Bokhari in Islamabad
Pakistan has witnessed a surge in the number of Covid-19 cases and deaths this week, with health officials warning against gatherings in public or at homes.
Government data released on Thursday showed 114 deaths in the previous 48 hours, the highest in a comparable period during the previous five months.
After a peak of 6,800 daily infections in June, the number fell to about 200 in August. On Thursday, health officials reported about 3,500 newly detected cases in the previous 24 hours.
Prime Minister Imran Khan’s government has already ordered closure of all schools, colleges and universities until January 10 to minimise contact through educational institutions. Hotels and halls have been banned from holding wedding ceremonies, which can now only be held in an open space with a limited number of guests.
But Pakistan’s opposition parties that are campaigning for Mr Khan to resign have defied the government and plan to hold a large public gathering in Lahore, the second largest city, on December 13.
Opposition leaders say Mr Khan who was elected in 2018 presents a “Covid-18 threat” that is more dangerous for Pakistan than Covid-19. Opposition protests are driven by high inflation, notably of food items, and the influential army’s backing of Mr Khan’s government.
J Sainsbury will forgo business rates relief granted by the UK government during the coronavirus pandemic, following the lead of rival supermarket groups Tesco and Morrison’s.
The FTSE 100 company benefited from £230m of business rates relief in the first half of its financial year, helping to offset £290m in costs incurred to protect staff and customers from infection, it said on Thursday.
The group expects to forgo roughly £410m in business rates relief for the year ending March 2021 and approximately £30m for the 2022 financial year.
For the full year, it had assumed that the negative impacts of the crisis on its financial services, fuel, general merchandise and clothing sales would be mitigated by roughly £450m in rates relief.
However, food stores have been classified as essential retailers and almost all of Sainsbury’s branches have been “open and trading strongly”, it said. Sales and profits have been better than the group initially expected.
“With regional restrictions likely to remain in place for some time, we believe it is now fair and right to forgo the business rates relief that we have been given on all Sainsbury’s stores,” chief executive Simon Roberts said.
Sainsbury’s said it would agree with government how best to forgo its business rates relief, as repayment is not required by law.
India’s November trade data highlighted the country’s sluggish economic recovery with exports and imports falling and the trade deficit widening to $10bn, said Nomura in a note on Thursday.
Provisional merchandise trade data for November showed that export growth contracted by 9 per cent year on year from -5.1 per cent in October, while import growth also slowed by 13.3 per cent.
The trade deficit has hit a post-lockdown high of $10bn in November, up from $8.7bn in October, with petroleum exports taking a hit. India reached a record surplus of $19.8bn in the second quarter after New Delhi imposed one of the world’s strictest lockdowns.
Core exports — including electronics and vegetable oils — picked up “possibly reflecting the festive and pent-up demand” but “sustained contraction in categories like machinery and transport equipment suggest weak investment demand,” said Nomura.
India’s return to pre-pandemic levels of growth is slower than its Asian peers as rising coronavirus infections make returning to business difficult. Nomura expects the current account surplus to remain elevated, though improving imports combined with sluggish exports will reduce the surplus in the coming quarters.
Go-Ahead’s bus passenger numbers have fallen about 15 per cent over the past four weeks after picking up to between 50 and 60 per cent of pre-pandemic levels before the most recent national lockdown.
The company, which runs about a tenth of the UK’s regional bus services, said 90 per cent of revenues were secured through contracts and so were not dependent on changes in passenger demand.
It was working towards paying a dividend at an appropriate level next calendar year, it said in its trading update on Thursday.
The government in August promised the sector rolling funding at up to £27.3m a week until a time when the funding was no longer needed, having spent hundreds of millions of pounds earlier in the year to keep vehicles on the road.
Go-Ahead said that at the half year end it expected to have about £200m available in cash and non-used facilities.
Public transport is “vital to achieving the country’s net zero ambitions while supporting economic growth”, group chief executive David Brown said. “This, combined with public transport’s ability to support the health and wellbeing agenda, underpins my confidence in the prospects of the group.”
Valéry Giscard d’Estaing, the former French president, has died at the age of 94 after being infected with Covid-19. He was one of the outstanding political figures in postwar France and on the wider European stage.
A liberaliser at home, where he became the Fifth Republic’s youngest president, until Emmanuel Macron in 2017, he also played a significant part in furthering European integration, notably by fostering the idea of the European Exchange Rate Mechanism and, later, by campaigning for French acceptance in a referendum of the 1992 Maastricht treaty that led to the creation of the euro.
Yet the EU’s subsequent draft constitution, produced by a convention that he chaired, was voted down by his fellow French citizens and by the Dutch before its reforms finally found a home in the Lisbon treaty of 2009. The referendum defeats in 2005 shook the entire union and exposed the gap between the people and the Brussels elite.
Read the full obit Valéry Giscard d’Estaing, former president of France, 1926-2020
Robin Wigglesworth in Oslo
The markets have become too hot to handle. So intense is the frenzied stock-buying that even many of Wall Street’s biggest brokerages and wealth managers are struggling to keep up.
Almost every major US brokerage firm — from old stalwarts like Charles Schwab and Merrill Lynch to new platforms such as Robinhood — suffered at least one outage in November, according to Downdetector, a website that tracks online service problems, as a torrent of trading overwhelmed their websites.
Thomas Peterffy, the billionaire founder of Interactive Brokers, who first started trading on the now-defunct American Stock Exchange in the 1970s, says the current environment is unlike anything he has ever seen before — but understandable.
“Money is now so easy, why not borrow what you can and put it into stocks? That’s what our customers are doing, and they’re making helluva lot of money,” he says.
Read more here
Gary Jones in Hong Kong
The Asian Infrastructure Investment Bank will provide a $50m loan to Corporación Financiera Nacional BP, Ecuador’s largest public bank, to address liquidity constraints facing small businesses in the country as a result of the pandemic.
The loan, provided under the AIIB’s Covid-19 Crisis Recovery Facility, is the first financing in Latin America by the Beijing-based bank.
Ecuador, with a population of just over 17.5m, has been severely affected by Covid-19. It has officially recorded over 195,000 cases with more than 13,500 deaths. The country’s GDP is expected to contract by 11 per cent this year.
Micro, small and medium-sized enterprises represent 99.5 per cent of all companies in Ecuador and 60 per cent of formal employment, according to the AIIB. The pandemic has made it increasingly difficult for MSMEs to meet their operational needs and expenses, such as payroll, supplies, rent and utilities, and to procure necessary goods and services to maintain production.
Clive Cookson, Anna Gross and Sarah Neville in London
People will not be able to pay to jump the coronavirus inoculation queue for many months, companies and public health officials insisted after the UK regulator became the first in Europe or North America to authorise a Covid-19 vaccine.
“I can say clearly and confidently that there are no plans to supply the private sector for the foreseeable future — no chance at all,” said Ben Osborn, Pfizer UK country manager, after the Medicines and Healthcare products Regulatory Agency approved the Pfizer/BioNTech vaccine on Wednesday. “Equity is at the heart of our decision to supply only the NHS,” Mr Osborn added.
He was confident that the Pfizer supply chain was secure enough to prevent any unauthorised diversion of the vaccine to the private market.
Public health officials in the UK pointed out that, even if companies were willing to sell their product for private use, anyone seeking to receive it in that way would be at the back of the queue behind countries and states that had already pre-ordered many millions of doses of the vaccine.
Read more here
If lockdown and social distancing are not enough of a challenge, how would you like to be confined to a research lab with your colleagues for three weeks — 19 metres under the sea?
Or perhaps you would prefer to be left in a cave system, isolated from the outside world with no natural light, minimal privacy and limited equipment for hygiene and comfort?
Welcome to the world of astronaut training. Both Nasa and the European Space Agency run field studies in locations with similarities to working in space: a “dangerous and unfriendly” place, according to Nasa’s website. Hazards include isolation and confinement, while behavioural issues are “inevitable”.
Although many are emerging from second pandemic lockdowns, heavy social restrictions remain. The performance techniques taught could help isolated workers who are struggling with a decline in mood, a lack of interaction and fatigue.
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Gary Jones in Hong Kong
The arrival of an effective vaccine will not reverse the damaging impact of Covid-19 on wages globally, the head of the UN’s International Labour Organization warned on Wednesday.
“It’s going to be a long road back and I think it’s going to be turbulent and it’s going to be hard,” ILO director-general Guy Ryder said with the release of its flagship Global Wage Report, which is published every two years.
The latest report shows how the pandemic has slowed or reversed a trend of rising wages across the world, with the most damaging impact on women and the low-paid.
With the exception of China, which the ILO said is bouncing back quickly, most of the world will take a considerable period of time to get back to where it was before the pandemic, which had dealt an “extraordinary blow” to the world of work.
“The aftermath is going to be long-lasting and there is a great deal, I think, of turbulence and uncertainty,” Mr Ryder said. “We have to face up to the reality, at least a strong likelihood that … as wage subsidies and government interventions are reduced, as they will be over time, that we are likely to face continued downward pressure on wages.”
The Global Wage Report shows how the pandemic has put pressure on wages, widening the gap between top earners and low-wage workers.
After four years when wages grew on average, by 0.4 to 0.9 per cent annually in advanced G20 economies, and 3.5 to 4.5 per cent in emerging G20 economies, wage growth slowed or reversed in two-thirds of countries for which data was available.
Alice Woodhouse in Hong Kong
Activity in China’s service sector soared in November on greater customer demand as the country’s recovery from the pandemic continues.
The Caixin purchasing managers index for the sector rose to 57.8 in November from 56.8 in October. The reading, which was well above the 50-point level marking expansion, was the highest since June.
New business expanded at the fastest pace since April 2010 and business confidence was at its highest in nine-and-a-half years.
China’s economy has reopened and remained so after shutting down to control the coronavirus outbreak at the start of the year. It has not experienced multiple waves of infections, unlike Europe, the US and parts of Asia, that have forced governments to reimpose restrictions.
The survey, combined with the Caixin manufacturing PMI, which hit a decade high, resulted in a composite PMI of 57.5 in November, up from 55.7 in October. That was the steepest increase in total Chinese output since March 2010, Caixin said.
“We expect the economic recovery in the post-epidemic era to continue for several months,” said Wang Zhe, senior economist at Caixin Insight Group. At the same time, deciding how to gradually withdraw the easing policies launched during the epidemic will require careful planning as uncertainties still exist inside and outside China.”
Gary Jones in Hong Kong
The Asian Development Bank has approved a $100m grant to support Afghanistan in its response to the pandemic.
“The assistance will help strengthen the health system, expand social protection for the poor and vulnerable population while ensuring gender mainstreaming, and support macroeconomic stabilisation and job creation in Afghanistan,” said ADB president Masatsugu Asakawa.
Afghanistan’s economic outlook has deteriorated during the pandemic because of business lockdowns, a sharp drop in household incomes and a downturn in regional trade and remittances.
ADB forecasts Afghanistan’s GDP to contract by 5 per cent this year. Nearly 250,000 micro, small and medium-sized enterprises — accounting for over 80 per cent of nonagricultural employment — have been especially badly hit.
Afghanistan’s unemployment rate is projected to rise to 37.9 per cent in 2020 from 23.9 per cent in 2019. The national poverty rate is expected to reach up to 72 per cent this year from 55 per cent in 2017, with an additional 6m people falling into poverty. Spikes in food prices due to disruptions in supply have increased the risk of food insecurity.
Alice Woodhouse in Hong Kong
Activity in Japan’s service sector was hit by a surge in coronavirus infections in November, with a renewed decline in employment, according to a private survey.
The au Jibun Bank Japan services PMI edged higher to 47.8 in November from 47.7 a month early, remaining below the 50-point level marking an expansion.
New business contracted at the fastest pace since August, dropping for the 10th consecutive month.
Companies surveyed said a third wave of coronavirus cases in the country had hit demand. Employers scaled back staffing amid ongoing weakness in activity.
The composite PMI, which combines readings for the manufacturing and service sectors, was little changed at 48.1 against 48 previously.
“Japanese private sector firms remain confident of a wider recovery over the next year amid hopes that the pandemic will recede and private sector activity will be supported by a broad-based boost in demand stemming from stable business conditions and the Tokyo Olympics,” said Usamah Bhatti, economist at IHS Markit.
IHS Markit forecasts the Japanese economy will grow 2.2 per cent in 2021.
Gary Jones in Hong Kong
Almost half of the population in Central Asia is not digitally connected, falling behind in learning and not receiving adequate healthcare during the pandemic, a World Bank representative said on Wednesday.
“The COVID-19 crisis has underlined the connectivity chasm — the digital divide between those who are connected and those who are not,” said the World Bank regional director Lilia Burunciuc during its “COVID-19 and the Digital Divide in Central Asia” online briefing. “This digital divide is worsening existing social inequalities and is hampering economic growth in the region.”
Recent studies show that countries with robust connectivity infrastructure have been able to mitigate many negative economic impacts of the pandemic, allowing governments, individuals and businesses to cope with social distancing, work from home and get access to distance learning and telehealth.
According to telecoms market researcher TeleGeography, access to high‐speed internet is limited and costly across Central Asia, with the household fixed broadband penetration rate varying from 3.1 per cent in Tajikistan to 35 per cent in Kazakhstan, and both fixed and mobile broadband Internet speeds significantly below the global average.
Kiran Stacey in Washington
The US is making a mistake by prioritising nursing-home residents for a coronavirus vaccine, according to a member of the government panel responsible for setting national distribution guidelines.
Keipp Talbot, the only member of the Advisory Committee on Immunization Practices to vote against its recommendations on distributing the vaccine, told the Financial Times on Wednesday that she worried the jabs could prove less effective with care-home residents.
“We know that vaccines typically don’t work very well in residents of long-term care facilities, partly because of comorbidities such as diabetes, and partly because of general frailty,” said Dr Talbot, an associate professor of medicine at Vanderbilt University in Nashville, Tennessee.
“When we are looking at a limited supply of vaccine, we should use our resources to focus on vaccinating staff of those facilities rather than the residents.”
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Gary Jones in Hong Kong
The Asian Development Bank and Jakarta-based technology group Gojek signed an agreement to research the impact of digitisation and the Covid-19 pandemic on Indonesia’s micro, small and medium-sized enterprises.
“We anticipate the findings of this research will help shape policies that expand opportunities for unique and innovative online platforms like Gojek to further contribute to inclusive and sustainable development,” said ADB chief Economist Yasuyuki Sawada.
The agreement, signed by Mr Sawada and Gojek chief of public policy and government relations Shinto Nugroho, outlines research into the benefits of business digitisation on MSMEs using Gojek’sdigital ecosystem and big data.
The research aims to assess the impact of Covid-19 on small businesses, discover emerging patterns and identify measures to support recovery.
Gojek is a south-east Asian technology platform providing services including transport, payments, food delivery and logistics. As of October 2020, Gojek’s applications had been downloaded more than 190m times across the region.
Alice Woodhouse in Hong Kong
Business conditions in Hong Kong stabilised in November, according to a private survey, even as a surge in coronavirus infections dampened confidence.
The IHS Markit Hong Kong purchasing managers’ index rose to 50.1 in November, up from 49.8 in October. The reading, which is marginally above the 50-point no-change level, suggested “broadly unchanged” conditions in the territory’s business conditions, Markit said.
November’s reading was the highest since March 2018.
The tightening of social distancing rules in the middle of the month, in efforts to limit a fourth wave of coronavirus infections, had had “little impact” on business activity.
Output fell modestly with survey respondents pointing to subdued demand, while employment fell for a second month.
New orders from mainland China and overseas fell at a slower rate than during the height of the pandemic.
“The average PMI reading of 49.9 for the fourth quarter so far is the highest for nearly three years and consistent with annual GDP growth,” said Bernard Aw, principal economist at IHS Markit. “That said, a global resurgence of Covid-19 cases and measures to contain fresh waves of infections locally pose as downside risks to the recovery.”
Hong Kong’s economy is in the doldrums after slipping into recession in 2019 on the effects of social unrest and the US-China trade war.
Peter Wells in New York
The number of coronavirus patients in US hospitals topped 100,000 for the first time on Wednesday, while new cases jumped by a record of more than 195,000.
In addition to those milestones, the country tallied its second-biggest one-day jump in deaths of the entire pandemic.
The number of people in US hospitals being treated for coronavirus hit a record 100,266, according to Covid Tracking Project data on Wednesday.
The number of hospitalisations nationally has more than doubled since the end of October.
On Wednesday, 16 states reported their highest level of patients for the pandemic. Although this is down from a seven-month high of 23 on November 30, it included a new peak for California that surpassed its summer high.
The US reported a record 195,695 coronavirus cases, edging past the previous peak of 193,667 on November 25. California, the most populous state, reported 20,759 cases on Wednesday, a record one-day jump for any US state.
Over the past week, the country has averaged 161,411 cases a day. That is down from a peak seven-day average of 172,531 on Wednesday last week, probably reflecting a drop off in testing and delays in processing on Thanksgiving and the holiday weekend.
States attributed a further 2,733 deaths to coronavirus, up from 2,473 on Tuesday and compared with 2,289 on Wednesday last week. It was the second-biggest one-day jump in fatalities of the entire pandemic, lagging only a record 2,752 deaths on May 7.
Illinois had a record increase of 266 deaths. More encouraging, though, is that although average death rates in the Midwest state and its neighbours remain at elevated levels, daily case rates in most of those states have trended lower in recent weeks. The Midwest region became a coronavirus hotspot during autumn.
Gary Jones in Hong Kong
Covid-related school closures globally risk pushing an additional 72m primary school-aged children into “learning poverty”, according to a World Bank report released Wednesday
Such children would be unable to read and understand a simple text by the age of 10.
“The pandemic is amplifying the global learning crisis that already existed,” the World Bank said in a statement. “It could increase the percentage of primary school-age children in low- and middle-income countries living in learning poverty to 63 per cent from 53 per cent, and it puts this generation of students at risk of losing about $10trn in future life-time earnings, an amount equivalent to almost 10 per cent of global GDP.”
The report, entitled Realizing the Future of Learning: From Learning Poverty to Learning for Everyone, Everywhere, lays out a vision for the future of learning that can guide countries today in their investments and policy reforms.
“Without urgent action, this generation of students may never achieve their full capabilities and earnings potential, and countries will lose essential human capital to sustain long-term economic growth,” said Mamta Murthi, World Bank vice president for human development. “Having over half of children worldwide in learning poverty is unacceptable.”
According to the World Bank, Covid-induced school closures have left most students out of school globally — 1.6bn students at the peak in April 2020 and almost 700m today.
Alice Woodhouse in Hong Kong
Asia-Pacific equities rose on Thursday after a lacklustre day for US stocks as optimism over vaccine progress was offset by softer labour market data.
Japan’s Topix nudged up 0.2 per cent while the S&P/ASX 200 in Australia added 0.4 per cent. Futures point to a 0.2 per cent gain for the Hang Seng in Hong Kong.
Those moves came after the S&P 500 closed 0.2 per cent higher at a record, while the tech-heavy Nasdaq Composite dipped 0.1 per cent. US private sector employment rose at a slower pace than forecast in November after states imposed restrictions to limit the spread of coronavirus.
Investors are also focused on a potential $908bn US stimulus proposal.
The UK has become the first country to approve a Covid-19 vaccine after large scale clinical trials. The BioNTech/Pfizer inoculation will be available for high-risk groups from next week.
Peter Wells in New York
Texas on Wednesday reported its second-biggest one-day jump in new coronavirus cases since the start of the pandemic and its biggest increase in deaths in about two weeks.
A further 14,758 new cases were revealed on Wednesday afternoon, down from Tuesday’s record of 15,182, according to data from the health department.
Authorities also added a further 1,666 older cases stemming from backlogs of tests to the statewide total, although these were excluded from the daily figures.
Deaths rose by 207, up from 170 on Tuesday and compared with 200 on Wednesday last week. It was the biggest jump in fatalities since a near-three-month-high of 230 on November 19.
Hospitalisations rose to 9,109 from 9,047 on Tuesday. That remains the highest level since January 31 and is about 16 per cent below the state’s July 22 peak.
Peter Wells in New York
Illinois on Wednesday reported its biggest one-day jump in coronavirus deaths of the pandemic, while new cases remain below recent record highs.
Daily deaths, which tend to lag cases and hospital admissions, have hit high or record levels in several Midwest states in recent days, but encouraging trends for most of the region remain in place as new infections continue to decline from peak levels in November.
Illinois attributed 238 deaths to coronavirus on Wednesday, soaring past the state’s previous one-day record of 191 on May 13, according to health department data. Its overall death toll of 11,963 ranks sixth in the US, behind New Jersey and ahead of Massachusetts.
Wisconsin this afternoon reported a further 82 deaths, down from Tuesday’s record of 107, while Indiana revealed 91 more fatalities, down from the 146 on Tuesday that ranked among the state’s 20 most deadly days.
Ohio reported a further 123 deaths, it’s third-biggest daily jump of the pandemic, up from 119 on Tuesday. The state set a daily record of 156 on November 25.
More encouraging, though, is that daily cases in these states have trended lower in the past few weeks. On Wednesday, Illinois reported a further 9,757 infections, down from an 11-day high on Tuesday of 12,542.
Wisconsin had a further 3,777 new confirmed cases, down from 4,078 on Tuesday but nearly half its record of 7,989 on November 18, according to health department data. Indiana revealed a further 6,655 cases, up from 5,396 yesterday and compared to its record of more than 8,300 on November 14. Ohio reported 7,835 new cases, down from 9,030 on Tuesday. The state had 11,885 on a single-day on November 23.
With the exception of Ohio, all of the 11 states in the Midwest had seven-day average case rates that were down at least 10 per cent from peak rates, according to a Financial Times analysis of Covid Tracking Project data.
While officials in many states across the country have warned that it may take a week or so to gauge any impact of the Thanksgiving holiday on infection rates, states in the Midwest were already experiencing a gradual decline in daily case rates from around mid-November. That may help, albeit partially, to offset rising trends in other parts of the country. California and Texas, which rank first and second among states by population, are reporting one-day jumps in new cases that exceed levels they hit during their summer surge.
Peter Wells in New York
California on Wednesday became the first US state to report more than 20,000 coronavirus cases in a single day.
The most populous state logged 20,759 infections, its health department revealed this afternoon, up from 12,221 on Tuesday and eclipsing its previous record of 18,350 on November 25.
The single-day jump is more than the 18,266 cases logged for the entire pandemic by Hawaii, which was the third-fewest number of infections among US states. It is more than 10 times the overall tally for New Zealand, which has a population about an eighth of California’s nearly 40m residents.
Although California has confirmed some 1.24m cases, more than any other US state, it ranks among the bottom quartile when adjusted for its population.
Although the Golden State has averaged more than 200,000 tests a day over the past fortnight, the latest batch of cases came from just 137,813 tests, the fewest in about two weeks. The positivity rate has averaged 6.9 per cent over the past 14 days, according to state data, the highest since the end of July.
Recent daily cases may be affected by delays to processing following Thanksgiving and the long weekend, but other metrics suggest California may be experiencing a spread of coronavirus that is set to surpass its summer surge. Governor Gavin Newsom warned earlier this week about the possibility of more “drastic action” if hospitals become overwhelmed, and hinted that officials could soon announce a stay-at-home order akin to earlier in the year.
Hospital admissions hit a record 9,365, the health department revealed, having crossed 9,000 for the first time yesterday. That eclipses the previous peak of 8,820 in late July.
Authorities attributed a further 113 deaths to coronavirus, up from 70 yesterday and compared with 106 on Wednesday last week. It was the biggest one-day jump in fatalities since the 162 reported on October 22. The state set a one-day peak of 219 in late July.
The German authorities have decided to extend the partial lockdown, in force since the start of November, until January 10. The measures have closed all restaurants, bars, gyms, theatres and concert halls, and essentially shut down domestic tourism.
Moncef Slaoui, who leads the US Operation Warp Speed to accelerate vaccine development, believes the UK approval of the Pfizer-BioNTech vaccine should reassure Americans they can trust the shot. Mr Slaoui said the UK regulator is of the “highest calibre” and equivalent to the US Food and Drug Administration.
New York Governor Andrew Cuomo said he expects the state will receive its first batch of vaccines from Pfizer on December 15, pending federal government approval. That shipment should provide enough vaccines for 170,000 New Yorkers, starting with care-home residents and healthcare workers.
US health officials have changed official guidelines so that people who come into contact with someone who has been infected with coronavirus will no longer have to remain in quarantine for 14 days, and could return to normal life as soon as a week after their last contact.
Europe’s largest tour operator Tui secured a third round of government-backed funding. The company said on Wednesday it reached an agreement with banks, the German government and Unifirm, Tui’s largest shareholder, on a package worth €1.8bn. The deal will “ensure that the company can bridge the gap if the pandemic persists in 2021”, Tui said.
Airlines and airports have renewed their calls for quarantine restrictions to be dropped following the publication of European travel guidelines that say travellers should not automatically be considered high-risk for spreading infection.
Becton Dickinson, the world’s largest needle maker, plans to invest $1.2bn to expand syringe production, as the US and other nations prepare for the roll-out of coronavirus vaccines.
Austria’s government has bowed to pressure from fellow EU countries and will keep its ski resorts closed until at least Christmas Eve amid fears that a normal start to the alpine sporting season will accelerate the spread of coronavirus.
Bonmarché has collapsed into administration, putting roughly 1,600 jobs at risk. Bonmarché’s administrators on Wednesday said it had not yet made redundancies or closed any stores. “Bonmarché remains an attractive brand with a loyal customer base,” it said.