Rolling coverage of the latest economic and financial news, as Jerome Powell insists the Federal Reserve can do more to help America through the coronavirus recession
10.54 am BST
UK property firm Intu has been forced to ask for a’ impasse agreement’ from its lenders, after being badly hurt by the coronavirus crisis.
Intu told stockholders this morning that it will probably breach the commitments, or agreements, on its lends.
Significant market uncertainty remains regarding the impact of Covid-1 9 on the operations of intu’s centres which, with the exception of crucial storages, remain semi-closed until at least 1 June 2020. Additionally, at this time, the velocity of recovery once the UK comes out of lockdown remains unclear.
The resulting impact on rental collections and valuations at the end of June is likely to result in breaches of covenants or material liquidity requirements if any such infringes “re gonna be” cured in accordance with the financing records at that time.
10.25 am BST
Ryanair chief Michael O’Leary has also hit out at the UK government for mishandling the crisis, saying its plan to make overseas visitors quarantine themselves is “idiotic and unimplementable”.
Here’s the full narrative 😛 TAGEND
10.22 am BST
Budget airline Ryanair has stern terms for competitives who have taken financial support from governments to keep afloat through the lockdown.
In its latest financial results, Ryanair predicts a price war from operators who have taken hundreds of millions of euros in help.
When Group airlines return to scheduled flying from July, the competitive landscape in Europe will be distorted by unprecedented quanta of State Aid( in breach of EU regulations) under which over EUR3 0bn has been endowed to the Lufthansa Group, Air France-KLM, Alitalia, SAS and Norwegian among others.
We therefore expect that traffic on reduced flight schedules will be subject to significant price discounting, and below cost selling, from these pennant carriers with massive State Aid war chests.
Ryanair’s balance sheet is one of the strongest in the industry with a current money balance of EUR4. 1bn( Ryanair recently grew PS600m under the UK’s CCFF) and 330 unencumbered B737s( 77% of owned fleet ).
Ryanair CEO Michael O’Leary says German and French bailouts misrepresent the airline market. He constructed the comments after Europe’s biggest low-cost carrier boosted its liquidity with a 600 million-pound loan backed by the U.K. government https :// t.co/ 64 rs1adtVA pic.twitter.com/ BZM6BSA 325
Ryanair has moxie. Airline reports earning of one billion Euros for year to the end of March, grumbles bitterly about “unprecedented quanta of State Aid” on offer to its contenders and then divulges it has raised PS600 million using an emergency support scheme backed by UK government pic.twitter.com/ SkrQX8nyWq
10.04 am BST
What a difference a month makes.
9.43 am BST
Wall Street is expected to open higher today, is assisting Jerome Powell’s latest commitment to take further action to protect America’s economy through the slump.
9.24 am BST
Several European countries have hoisted their outlaw on short-selling shares, in another sign that the panic created by Covid-1 9 has eased.
France, Italy, Spain, Belgium, Austria and Greece are all scrapping limiteds that prevented merchants from selling shares they didn’t own( hoping to buy them back cheaper ).
– France, Spain, Italy and Belgium have hoisted short-selling proscriptions as expected- Austria’s ban will be lifted at midnight neighbourhood time
“Markets have partly reduced their losings, trading volumes and volatility to revert to tiers that remains high-pitched compared to mid-February, however this reflects market participants’ uncertainties in the current context
9.11 am BST
The gold price has hit its highest level since 2012, amid predictions that the coronavirus outbreak will drive inflation up.
Gold bullion is up 1.2% this morning at $1,760 per ounce for the first time since October 2012.
Gold has emerged as a clear winner from the economic turmoil established by the pandemic.
There has been more energy about amber bulls today and prices have driven up to above $1760, the most prominent since Oct 2012. The peak in that month of $1795 is the next target for policemen.
Gold costs spikes to degrees last-place seen in 2012 on concerns over the weekend about; a deeper recession monetary stimulus from central banks flooding the systemwith liquidity. pic.twitter.com/ onISNL5bJp
8.53 am BST
The Covid-1 9 crisis will drag India into an unprecedented recession, Goldman Sachs has warned.
Goldman’s economists suppose India’s GDP will shrink at an annualised rate of 45% in the current quarter. It has been already predicted a 20% tumble, but has revised its prognosis after India widened its tough lockdown until the end of May.
8.49 am BST
European marketplaces are a tranquil sea of light-green this morning, with the primary indices up around 2 %.
That’s a solid recovery from last week’s plunges, which transmit stocks to a three-week low.
“The economies of Europe and the U.S. likely bottomed out in April and are slowly starting to come back to life.
“However, incoming data regarding most economies highlight the depth of the contraction, heightening dangers of longer-term scarring that might undermine the recovery.”
8.36 am BST
The European Central Bank’s chief economist has warned that the eurozone economy might not recover from the Covid-1 9 slump until 2022.
Philip Lane told Spanish newspaper El Pais that the coronavirus “re gonna have a”‘ terrible’ impact, and sounded notably cautious about the future, saying 😛 TAGEND
In March the pandemic and the measures to contain it had already led to a substantial contraction of activity. This situation get worse again in April, where we envisioned a deep fall in activity everywhere. Now the picture is changing: some countries are beginning to loosen their lockdowns. How this will develop in the future depends a lot on how quickly the restrictions on economic activity is likely to be eased, but also on how we adapt to living with the virus.
The speed at which their own economies ricochets back will then hinge on whether buyers are more reluctant to consume and industries held up on investment. From today’s perspective, it gazes in all such cases unlikely that economic activity will return to its pre-crisis level before 2021, if not later.
8.21 am BST
A wave of optimism has lifted Britain’s FTSE 100 by 128 phases, or 2.2%, in early trading in London.
Nearly every member of the blue-chip index is up, led by mining corporations. Fresnillo (+ 8 %), Glencore (+ 5 %) and Anglo American (+ 5 %) are all crisply higher, following Jerome Powell’s expresses its determination to loose more firepower if needed.
It does feel like we’re in the middle of a phoney war at the moment with all of us waiting to see how efficiently the various economies are able to re-open given all the social distancing that will be required
8.01 am BST
Good morning, and welcome to our wheel coverage of their economies, the financial markets, the eurozone and business.
The economic cost of the coronavirus continues to mount. Overnight, Japan has followed Germany, France and Italy into recession as its Covid-1 9 lockdown hit economic growth.
“The sharp-witted fall in output in the first quarter intimates the spread of the virus had already dealt a significant blow to economic activity in March.”
PELLEY: Has the Fed done all it can do?
POWELL: Well, there’s a lot more we can do. We’ve done what we can as we go. But I will say that we’re not out of ammunition by a long shot. No, there’s actually no limit to what we can do with these giving programs that “were having”. So there’s a lot more we can do to support the economy, and we’re committed to doing everything we can as long as we need to.
Read more: theguardian.com