China’s trade data improves, but France warns of strong Covid-19 recession – business live | Deal

British banks and other lenders have granted more than 1.2 million mortgage-paying holidays to households affected by the coronavirus outbreak, according to the UK Finance industry group.

He says:

“Lenders’ action means that one in nine UK mortgages is now subject to a payment holiday.

France’s finance minister warned that its economy will suffer an even sharper recession than originally feared, as measures to contain the Covid-19 outbreak are extended.

Bruna Le Maire says GDP is now expected to shrink by 8% in 2020, an extremely painful contraction, and even worse than the previously expected 6%.

Like much of Europe, France is currently under strong blockade, and is committed to supporting its companies and workers to survive the pandemic.

The impact of these emergency measures will raise France’s budget deficit; it is now expected to reach 9% of GDP this year.

Le Maire told BFM TV that the Paris government will do whatever it takes to cushion the impact of the recession:

“If we need to do more, we will do more. We will be there.”

Yesterday, French President Emmanuel Macron announced that the blockade will last another month, at least.

In a television address, he said France would begin to return to normal life on May 11, if citizens were “civic, responsible and respectful of the rules,” and if the number of coronavirus cases continued to decline.

The FTSE 100 does not share today’s rally, it is now down 36 points or 0.6% to 5806.

That’s still a big improvement from last month’s lows (when it closed below 5,000 points for the first time since 2011).

The troublesome cruise operator Carnival is the one that falls the most, with a decrease of 6%, with Intercontinental Hotels 5.8% and the gaming company Flutter losing 4% (three actions all vulnerable to the Covid-19 blockade).

The stronger pound will also pull the Footsie back a bit.

European stock markets remain at their highest levels in over a month.

The Stoxx 600 index across the EU is trading at 334 points, up 0.8% today, its highest level since March 11, and from 280 points three weeks ago.

Rachel Winter, associate director of investment at Killik & Co, says global markets have escaped their recent bear market:

“European markets may have been closed over the Easter weekend, but other major markets around the world were still open, so the value of the MSCI World index was calculated yesterday. The index closed at 1956.75, which is 19.6% below its all-time high, and that means that we are no longer in a bear market right now.

This really highlights how much the markets have recovered from the lows it reached in late March. The MSCI World has risen 22% since then. We have seen some absolutely huge moves in the past few weeks and for us this just shows how difficult it is to test and time the market.

The pound has also strengthened to a one-month high of $ 1,256 today.

Overnight, the International Monetary Fund has announced that it will provide debt relief to some of the world’s poorest countries, to help them manage the coronavirus pandemic.

The Fund will pay off the debt owed to it by 25 countries, primarily in Africa, over the next six months to free up vital cash for health care.

They are: Afghanistan, Benin, Burkina Faso, Central African Republic, Chad, Comoros, Congo, DR, Gambia, Guinea, Guinea-Bissau, Haiti, Liberia, Madagascar, Malawi, Mali, Mozambique, Nepal, Niger, Rwanda, São Tomé and Principe, Sierra Leone, Solomon Islands, Tajikistan, Togo and Yemen.

IMF chief Kristalina Georgieva says:

“This provides grants to our poorest and most vulnerable members to cover their debt obligations to the IMF during an initial phase over the next six months and will help them channel more of their scarce financial resources towards vital emergency medical efforts and other help.

Sarah-Jayne Clifton, Director of Jubilee debt campaignHe says it is a “very welcome move,” but more is needed.

This debt cancellation helps keep the money in the countries so it can be used for urgent health and social protection expenses. Crucially, payments are canceled instead of going forward.

“However, the magnitude of the economic crisis facing developing countries requires that the IMF go much further. The IMF has reserves of $ 27 billion and more than $ 135 billion of gold. You can afford to pay off more debts, and now is the time to do it. We need the cancellation of payments to extend to a much larger group of developing countries and for the next full year. Beyond the IMF, debt cancellation must cover payments to all creditors, including the private sector, along with the start of a process to determine how to reduce debts to a sustainable level once the crisis is over. “

Right on: Budget airline Wizz Air says it is cutting 1,000 jobs, due to the impact of Covid-19.

Almost one in five employees is being laid off, and others are being suspended, due to travel restrictions imposed by governments.

Wizz Air says:

Despite its best efforts, the Company is taking the difficult step of making 1,000 jobs redundant, representing a 19% reduction in the workforce. Additional measures have also been and will be taken for short-term employees as required by travel restrictions due to the COVID-19 pandemic.

The company’s CEO, the Board of Directors and all senior officials are reducing their salary by 22%, while the salaries of pilots, cabin crew and office staff will be reduced by 14% on average .

The news comes when Heathrow Airport predicts passenger air traffic will drop 90% in April, after a 52% decrease in March.. Much of this lawsuit is limited to airlines that focus on the repatriation of citizens trapped abroad during the coronavirus travel ban.

The total number of flights that landed and took off at Heathrow, covering both passenger and cargo aircraft, fell 35% to 25,798. The airport also warned that decreased travel would have “lasting and significant” effects on the industry (my colleague Kalyeena Makortoff reports):

Upcoming stocks are also on the rise, 2.2% after announcing plans to reopen its online purchases.

The retail chain suspended shopping and web distribution last month, when the UK shutdown began. But now it plans to reopen starting today, insisting that it has addressed staff concerns about contracting the covonovirus.

Then he says to the city:

On Thursday, March 26, NEXT announced that it had temporarily closed its online business along with its warehousing and distribution operations, having listened very carefully to colleagues.

Since then, NEXT has implemented very extensive additional security measures and, after consultation with colleagues and our recognized union, USDAW, will reopen online on a very limited basis starting today, Tuesday April 14, 2020. Initially, only the categories that our clients need the most. offered, such as children’s clothing and selected small household items. Other product ranges may be added at a later date.

Operations will begin with the support of willing and able colleagues to return to work safely. The idea is to start selling in low volumes, so that we only need a small number of colleagues in each warehouse at the same time

Shares of pharmaceutical giant AstraZeneca have risen 6% after it began testing whether its drug Calquence can help treat seriously ill Covid-19 patients.

Calquence is a blood cancer treatment: it inhibits an enzyme called Bruton’s tyrosine kinase (BTK) that helps some leukemic cells survive and proliferate (details here).

AZ is now testing whether Calquence could help treat the exaggerated immune response associated with COVID-19 infection in seriously ill patients.

He says there is strong scientific evidence that BTK plays a role in the exaggerated immune response suffered by some seriously ill patients (this is the “cytokine storm” that can strike in the second week of infection as the patient’s immune system goes into overdrive)

Yesterday, Forbes reported that the first results were “promising.”

José Baselga, AZ Executive Vice President of R&D in Oncology, says the company is moving at a record pace to test the drug:

“With this essay we are responding to new ideas from the scientific community and we hope to demonstrate that adding Calquence the best supportive care reduces the need to place patients on ventilators and improves their chances of survival. This is the fastest launch of any clinical trial in AstraZeneca history. ”

European markets have also opened higher, with the Stoxx 600 gaining 1%, and Germany leaping 1.6%.

But in London, the rally is a bit more muted, with the FTSE 100 gaining 0.5% or 30 points.

Asia and the Pacific stock markets have hit a one-month high, helped by better-than-expected trading data from China.

Major indices have gained ground, raising the MSCI Asian benchmark index to a four-week high, and 20% above its lowest point in March.

Reuters explains:

Analysts said some of the tail risks that had threatened a much deeper and longer recession were beginning to dissipate thanks to a slowdown in new coronavirus cases in major economies and a series of monetary and fiscal stimuli at the level world.

Market sentiment was fueled by data showing China’s exports in March fell just 6.6% from the same period last year, smaller than the expected 14% drop. Imports decreased a modest 0.9% compared to expectations for a 9.5% drop.

“Looking ahead, production constraints should no longer be an issue as economic life in China returns,” Oxford Economics said in a note, but added that exports were expected to drop more substantially due to weak demand. global.

New trade data from China offers hope that its economy is recovering from the coronavirus shock.
Chinese exports fell 6.6% year-on-year in March in US dollars, according to the General Administration of Customs, while imports contracted 0.9%. That’s a notable improvement in January and February, when imports decreased 4% and exports contracted more than 17%.

Trade data is even better when valued in Chinese yuan: this showed a 3.5% drop in exports and 2.4% upload in imports last month.

This is better than economists expected.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, writes:

Asian stocks started the week on a mostly positive note on the back of encouraging trade data in China. Chinese exports fell 6.6% in March compared to a 14% drop expected by analysts and a 17.2% decrease registered a month earlier. Imports fell 0.9% year-on-year during the same month versus -9.5% recorded and -4.0% printed a month earlier.

China’s trade surplus increased to $ 19 billion in March, from $ -7.09 billion printed in February. However, due to Friday, Chinese GDP should confirm a 6% drop in the first quarter. But for now, the mood of the market seems to be holding up.

Good morning, and welcome to our continued coverage of the global economy, financial markets, the eurozone, and business.

After a refreshing break for Easter, the stock markets are resuming their recovery, despite the large body of evidence that Covid-19 is dragging the global economy into a deep recession.

Asia-Pacific indices have rebounded overnight, with Japan’s Nikkei rising 2.% and China’s CSI 300 rising 1.2%.

And after its best week in over a decade, Britain’s FTSE 100 receives another 90 points. That would lift the blue chip index back to 5,900 points for the first time in a month (since the stomach drop on March 12).

The avalanche of stimulus packages and emergency liquidity movements by governments and central bankers are rooting for investors, despite the rising death rate in the United Kingdom and the United States.

As IG’s Kyle Rodda says:

For the markets, it is a matter of fundamental financial conditions at the moment. The Fed’s actions last week to open its lines of credit to a broader range of borrowers, and deepen the amount of credit it extends, has eased credit risk in the market.

There is also some relief that OPEC finally agreed to cut output over the weekend, although the deal has not raised crude prices much.

Markets will be reminded today that the world economy is in a terrible mess. The International Monetary Fund begins its spring meeting, virtually, with some new growth predictions. The latest World Economic Outlook report is expected to show that the world economy is contracting sharply as closure measures affect activity.

IMF Kristalina Georgieva He set the stage last week, saying the world is facing “a crisis like no other.”

Morgan Stanley is also preparing for the long term, predicting that the US economy. USA It will not return to pre-Covid 19 levels until the last quarter of 2021.

Analyst Matthew Harrison wrote:

Recovery from this acute period in the outbreak is only the beginning and not the end. We believe that the path to reopen the economy will be a long one. Various forms of social distancing will need to be turned on and off and will only come to an end when vaccines become available, in the spring of 2021 at the earliest.

The new earnings season begins today, with Wall Street banks JPMorgan ChaI know and Wells Fargo and consumer goods giant Johnson and johnson report results and give forecasts. That will show if corporate bosses are also preparing for a long haul or if they expect growth to pick up soon.

The agenda

• 13:30 BST: IMF publishes its Perspective of the world economy
• 15:30 BST: IMF publishes its Global Financial Stability Report