American Airlines soars on news it will boost U.S. flights in July

WASHINGTON (Reuters) – American Airlines Group Inc (AAL.O) shares jumped by 25% after it said Thursday it will significantly boost its U.S. flight schedule next month after dramatic reductions caused by the coronavirus pandemic, flying more than 55% of its July 2019 domestic capacity.

American shares, up 24.6% to $14.77 on the bullish announcement, are still down more than 50% since mid-February.

The airline, the largest U.S. carrier, will also boost its international flights schedule next month, flying nearly 20% of its July 2019 schedule.

By comparison, American flew just 20% of its domestic schedule in May and is flying 25% in June, said Vasu Raja, American Airlines’ senior vice president of network strategy.

“As an airline, we’ve consciously bet on demand coming back. We have bet the economy,” Raja said, noting American has been operating a larger schedule than U.S. rivals.

Raja told Reuters that the airline would fly just over 4,000 flights on peak days in July compared with nearly 2,000 on peak days in May. That is still down from the peak 6,800 daily flights before the crisis.

Other U.S. carriers are also adding flights to summer schedules.

In total, American plans to fly 40% of July 2019 capacity.

The airline is boosting flights from New York City airports, Los Angeles and Washington and adding flights from its Dallas Fort Worth and Charlotte hubs. It is also increasing flights to major cities in Florida, Gulf Coast cities and mountain destinations as national parks and outdoor recreational spaces reopen.

In late May, the airline carried a daily average of about 110,000 customers – an increase of 71% over the 32,000 daily average the airline served in April, but still far below last year. Load factors rose to 55% by late May.

American plans to resume service to additional European and Latin American destinations in August. It will resume service to Rio de Janeiro, Brazil from Miami on July 7.

Source: Read Full Article

Coronavirus: Pandemic ‘gripping the Amazon’ as people ‘die in their beds’

In Manaus, the largest city in the Amazon rainforest, people are dying in their beds. 

They are trying to lift the coronavirus lockdown across Brazil – people teem the streets, the traffic noise is deafening, the markets are full, but the body count keeps growing.

The COVID-19 pandemic is gripping the Amazon and it is spreading.

Brazil has the second highest number of cases in the world, behind the US, with more than 584,000 – and 32,548 deaths, according to the Johns Hopkins University, which is tracking the virus.

We joined a body collection in Sao Jorge, one of the worst hit neighbourhoods.

Family and friends crammed the streets as the SOS Funerals undertakers van negotiated its way through the narrow alleys of what is basically a slum.

SOS is paid by the city to pick up the poorest dead. Nobody in Sao Jorge can afford a proper funeral.

We could see the body of Afonso de Souza through the door to his breeze block single room.

Teary eyed friends told me he was really popular in the community but had a drink problem. They do not know what he died of – the point is, they never will. Afonso’s body, like hundreds of others, will never be tested.

The undertakers are used to this now. They have been collecting the dead in huge numbers for weeks.

Sixty bodies a day has now become 40 a day, but that is over double the normal numbers in a country where poverty and disease are part of everyday life, and death.

Dressed in full hazmat suits, they brought a simple coffin into his home and loaded him up. Friends and family helped carry the body to their vehicle – another victim, another family, another community hit by the pandemic.

Manaus is a remote city in the heart of the Amazon. Nobody drives to get here. You come by plane or more likely boat.

Despite its remoteness, despite the vastness of the Amazon, the rainforest and its river did nothing to protect its people from the virus as it swept through and actually still is.

There are no funeral corteges for these poor people, no hearses. Mini vans take the bodies to the COVID cemetery on the outskirts of the city.

We followed through in torrential rain. The funeral van struggling through waterlogged roads, huge plumes of spray soaking our windscreen as we left the city and entered the rainforest.

The Taruma Cemetery is huge and well established, but this is where coronavirus victims come.

Outside the gates – only three members of families of victims are allowed inside – relatives look through the fences of the cemetery trying to spot the funeral taking place. They stand in small groups, often crying, often hugging each other.

If there is a backlog of burials, and there often is, the coffins are offloaded into refrigerated lorries. The work of the SOS team is done, they have more work elsewhere.

We did not know what to expect in the cemetery. What we saw was a vast area of newly dug graves, grave diggers in hazmat suits digging more graves and tending to those holding the bodies of the dead. It is exceptionally grim.

At the bottom of a hill, families wait beneath a canopy to protect themselves from the incessant rain.

When it is their turn, they take their paperwork to a man who paints the name of the family member on a simple blue wooden cross.

They wait for a tractor and trailer to pull up beside the families and the cemetery staff hoist the coffins on to a flat bed.

It is silent but for the sound of mechanical diggers gouging out more graves from the mud.

Once loaded the tractor moves off followed by a morbid, sobbing, heartbreaking procession to the burial site.

The coffins are lowered into a newly dug pit. It is a mass grave. The coffins laid side by side.

Sticks pushed into the earth indicate where each coffin can be identified from six feet higher.

Wooden rectangles are later placed above the bodies so the family will forever more have somewhere to come to pay their respects and mourn.

Above the muddy pit, the families film on their phones – cry, throw flowers and hug each other. Then the work to cover the coffins begins. A huge digger picks up mounds of mud and moves to the grave side.

Source: Read Full Article

Germany forces all petrol stations to provide electric car charging

FRANKFURT (Reuters) – Germany said it will oblige all petrol stations to offer electric car charging as part of a sweeping 130 billion euro ($146.26 billion) economic recovery plan, boosting electric vehicle demand which has been hampered by consumer concerns over refuelling.

Germany unveiled the incentives as part of a broader stimulus plan which included staggered taxes to penalise ownership of large polluting combustion-engined sports utility vehicles.

Customers have been concerned about the limited operating range of electric cars, a factor which has hampered demand. Converting Germany’s 14,118 petrol stations would provide a significant boost to electric vehicle demand.

In Germany, electric cars made up only 1.8% of new passenger car registrations last year, with diesel and petrol cars accounting for 32% and 59.2% respectively.

Related Coverage

  • Factbox: German stimulus to drive forward green vehicles

Of the 168,148 new registrations in May, only 5,578 or 3.3% were electric cars according to German vehicle agency KBA. A further 51.1% were petrol powered, 31.6% were diesel cars and 17.6% were hybrid or plug-in hybrid cars.

As of March 2020, Germany had only 27,730 electric car charging stations according to BDEW, Germany’s association for the energy and water industry.

To make electric cars a mass market phenomenon, at least 70,000 charging stations and 7,000 fast charging stations are required, according to the BDEW.

Source: Read Full Article

Mexico overtakes U.S. coronavirus daily deaths, sets records

MEXICO CITY (Reuters) – Mexico overtook the United States in daily reported deaths from the novel coronavirus for the first time on Wednesday, with the health ministry registering a record 1,092 fatalities it attributed to improved documenting of the pandemic.

Latin American has emerged in recent weeks as a major center for coronavirus. Brazil, where the virus has hit hardest in the region, also reported a record number of deaths on Wednesday.

The Mexican government had previously predicted the pandemic would peak in early May and under U.S. pressure has begun reopening its vast auto industry, which underpins billions of dollars of business through cross-border supply chains.

However, plans to further relax social distancing measures this week were put on hold in recognition of the fact that infections had not yet begun coming down.

Wednesday saw a record 3,912 new infections, with the number of daily deaths more than twice the previous record of 501.

The total number of known cases in Latin America’s second-largest economy is now 101,238 and its tally of deaths is 11,729, making it the seventh country with most deaths from the virus, according to the John Hopkins Center for Systems Science and Engineering.

Deputy Health Minister Hugo Lopez-Gatell attributed the sharp jump in numbers to a new mortality committee established by the Mexico City government to better identify which deaths in the capital were caused by the virus.

“Over the past 20 or 25 days, we have had various cases that were slowly passed on to the registry, for various reasons,” he said. “A technical committee has specifically been carrying out complementary methods.”

The committee was established after growing criticism that Mexico’s very limited testing rate meant most cases and deaths from COVID-19, the illness caused by the virus, were not being registered. A Reuters investigation concluded that fatalities could be 2.5 times higher than reported.

Mexico’s government has previously admitted the real number of fatalities was higher than the official count.

It was not clear if the inclusion of more deaths registered by the Mexico City committee would push daily numbers higher in future.

Mexico, with just over a third of the population of the United States, is at an earlier stage of the pandemic curve than its neighbor and the government has acknowledged that deaths could eventually surpass 30,000.

U.S. daily reported deaths were 1,045 on Wednesday, government data showed.

Source: Read Full Article

UPDATE 1-Indian carmakers offer teasers as RBI softens stance, sources say

(Updates with Maruti quotes)

By Nupur Anand and Swati Bhat

MUMBAI, June 2 (Reuters) – Carmakers Maruti Suzuki , Hyundai and Mercedes Benz are offering buyers “teaser loans”, a move sources said followed a softening of the Indian central bank’s stance on the products in the face of a coronavirus crisis induced economic slump.

Although the Reserve Bank of India (RBI) never banned teaser loans, which offer low interest rates for a limited period before rapidly rising, its obvious disapproval had kept banks from offering them in the past, bankers said.

Maruti Suzuki, Hyundai and Daimler’s Mercedes Benz have all teamed up with banks to offer purchase schemes involving teaser deals, recent press releases show.

Maruti Suzuki India was hopeful there would be “an uptick in demand” as a result of its scheme, Shashank Srivastava, an executive at the carmaker, told Reuters.

A recent company survey of 150,000 customers showed a clear desire for “flexible financing”, Srivastava added.

Hyundai, Mercedes Benz and the RBI did not respond to requests for comment.

The RBI has previously said the terms on such loans were not transparent, warning that similar products had been instrumental in the U.S. subprime crisis of 2007-2008.

Five banking sources told Reuters there was a consensus among lenders and automakers that promotional teaser loans were needed to revive car sales, which automakers have warned could fall as much as 45% this fiscal year in a worst-case scenario.

“People will require some easier terms due to COVID-19 and thereafter they can pay higher, so it’s a scheme which is in line with the times,” one of three sources aware of the RBI’S change in position told Reuters.

Banking sources also said India’s Finance Ministry is pressuring banks to increase lending, although they are already saddled with over $120 billion of bad loans.

This burden is likely to rise in the wake of a two-month lockdown that has pummeled India’s economy.

The Finance Ministry did not immediately respond to a request for comment.

“There is a huge demand from the market to bring back promotion-led loans,” the retail head of a private bank that is considering launching a similar scheme said.

“After all, what other option do we have right now?”

One bank was considering using teaser loan schemes for mortgages to attract borrowers, a banker at the state-owned lender said.

A Mumbai-based ex-banker, who declined to be named, said there was a risk that teaser loans would eventually lead to more bad loans at Indian banks.

“Both the bank and the borrower should be aware and beware.” (Reporting by Nupur Anand and Swati Bhat; Editing by Alexandra Ulmer, Simon Cameron-Moore and Alexander Smith)

Source: Read Full Article

Coronavirus: Face masks and social distancing do work, but are not foolproof says study

Social distancing can limit the chance of catching coronavirus to under 3%, according to the most comprehensive study so far.

Keeping one metre apart reduces the risk of transmission to 2.6%, while a two-metre gap decreases the chance of infection by a further 50%.

The international report, published in The Lancet, analysed data from 172 studies in 16 countries.

It found that by wearing a face mask there’s just a 3% chance of catching Covid-19.

Eye protection lowers the risk to 5.5%.

Although some of the evidence is considered “low certainty”, the study provides the clearest picture yet that social distancing measures and face coverings will be key in slowing the spread of the virus and allowing lockdown restrictions to be eased safely.

The report warns that even combining and properly using face masks, goggles and social distancing doesn’t provide complete protection.

The authors suggest that healthcare workers should wear respirators rather than surgical masks for “greater protection”.

Governments across the world have taken different approaches to safety measures, including social distancing and the compulsory wearing of face masks, in part due to conflicting scientific opinions.

In France, China and Hong Kong parts of the hospitality sector have reopened with a one-metre rule in place, while Spain has far stricter mandatory face mask rules than most other countries in Europe.

The aim of the report is to combine studies from around the globe and analyse all of the science available, to help answer which measures might reduce transmission.

However the report also says that a surge in demand for face masks could “divert supplies from health-care workers and other caregivers at highest risk for infection” and that governments need to “quickly address access issues for face masks to ensure that they are equally available for all”.

Source: Read Full Article

Coronavirus: China would welcome ‘international review’ into COVID-19 pandemic, says ambassador to UK

China would welcome an “international review” into the origins of the coronavirus pandemic, Beijing’s ambassador to the UK has told Sky News.

Speaking on Monday’s edition of After The Pandemic, a Sky News series of special programmes looking at what life will be like after COVID-19, Liu Xiaoming said the purpose of such an investigation should not be to “label any country”.

“This review should be independent, free from politicisation, it should be based on science, the scientists should take the lead,” he said.

“The WHO [World Health Organisation] should lead this independent review.

Mr Liu rejected criticism of China’s response to the virus, claiming Beijing had “wasted no time in sharing information” with the international community.

“China’s record is clean [and] it can stand the test of time and history,” he declared.

However, a YouGov poll for Sky News found that 76% of respondents thought the outbreak had damaged China’s global standing.

A total of 68% thought the same of the United States, while 43% also thought the UK’s global standing had been hit.

Mr Liu also claimed that the pandemic will “make the world more united” and countries who had “rejected World Heath Organisation advice have paid a high price”.

The COVID-19 outbreak began in the city of Wuhan, in China’s Hubei province.

It has since spread around the world.

According to Johns Hopkins University, there have been more than 6.2 million cases of the coronavirus around the globe, with more than 370,000 deaths recorded.

Ambassador Liu was joined on Monday’s programme by David Miliband, former foreign secretary and now chief executive of the International Rescue Committee, historian Niall Ferguson and Mary Robinson, former UN human rights commissioner and former president of Ireland.

Ahead of the start of After The Pandemic, Sky News commissioned polling on the post-COVID-19 world.

One of the question asked was what the biggest issue facing the world will be.

Top of the pile was climate change (33%), followed by future pandemics (15%), poverty (14%), China (11%) and terrorism (3%).

Ms Robinson said nations around the world needed to emerge from the pandemic with a clear and unified plan to tackle climate change, but added she was “distressed” by what she was hearing at the moment.

She said a number of lessons could be gleaned from the “sudden, dramatic downturn”, including that government matters.

Ms Robinson noted that a number of countries with female leaders have fared particularly well, citing the likes of New Zealand, Denmark, Germany, Iceland and Finland.

Mr Miliband said the coronavirus outbreak was “not a short term crisis, it’s a medium to long-term change in the way we run the planet” that shows “our connected world suffers from disconnected government”.

Dermot Murnaghan will be hosting “After the Pandemic: Our New World” every night until Thursday. It’s a series of special live programmes about what our world will be like once the pandemic is over.

Tuesday’s theme is Economy and Work. He’ll be joined by the Nobel prize winning economist Joseph Stiglitz, Stephanie Kelton, whose forthcoming book explores how best to deal with issues ranging from poverty to building resilient infrastructure. Alongside them both is Lord Browne, the former chief executive of BP. Plus Senior economic adviser to Donald Trump Stephen Moore.

Source: Read Full Article

U.S. companies issue shares at fastest rate ever, selling the rally

NEW YORK (Reuters) – U.S. public companies sold more than $60 billion in shares in May, the biggest monthly haul ever, as they capitalized on a stock market rally fueled by hopes that the COVID-19 pandemic is subsiding.

The benchmark S&P 500 Index .SPX has risen around 40% off of recent lows, hit in late-March at the height of market panic during the coronavirus outbreak, and is now roughly 10% shy of all-time highs hit in February.

The whipsawing markets stunted companies’ ability to issue new shares and raise cash, with just $4.8 billion sold in March, the lowest monthly total since December 2018, Refinitiv data showed.

The market has rocketed back with $22.3 billion sold in April and $65.3 billion in May, the highest on record.

(GRAPHIC – U.S. public companies sell the rally: here)

The likes of Southwest Airlines Co (LUV.N) and cruise operator Carnival Corp (CCL.N) have issued new stock to raise money. Major shareholders in companies such as BlackRock Inc (BLK.N) and U.S. drugmaker Regeneron Pharmaceuticals Inc (REGN.O) have cashed out their stock, with the market rebound far from certain to last.

“We’re talking to a lot of companies around the fact that the market is here, you don’t know what lies in the economy to come,” said Ryan Parrish, head of Americas equity capital markets syndicate at Bank of America (BAC.N). “If you even remotely have a need you should get it done now.”

The share sales echo a similar trend in U.S. debt markets, where companies have raised more than $1 trillion so far in 2020.

As in debt markets, the balance of companies selling new shares has shifted from those facing an imminent cash crunch to those stocking up on rainy day funds.

“There are a whole host of companies that have been hugely impacted by COVID-19 and have had to recapitalize,” said Santosh Sreenivasan, head of equity-linked capital markets for the Americas at JPMorgan Chase & Co.

“Issuers that have seen their stock prices recover are now also taking the perspective that they don’t want to miss this window in case this rebound is short-lived,” Sreenivasan said.

Source: Read Full Article

Spanish nightclub industry draws up code to allow safe partying

MADRID (Reuters) – Dancing with masks on, sipping drinks with straws and keeping to marked off areas of the dance floor are among post-lockdown safety proposals aimed at helping Spain’s nightclubs reopen their doors in time for the summer season.

Clubs have been shut since the government imposed one of the most stringent coronavirus restrictions in Europe in March, which devastated the tourism sector that accounts for more than 12% of Spanish GDP.

With the lockdown now easing, the National Federation of Leisure and Entertainment Businesses (FNEOE), an industry group, and the Institute for Quality Tourism, a lobby group, have drawn up safety guidelines as they wait for the green light for clubs to open.

The plan recommends masks should be compulsory on the dance floor and clubbers would have to wash their hands as they enter and leave discos. Dance floors would be clearly marked off from other parts of clubs so customers did not mix and drinks would only be served with disposable straws.

The nightlife sector, including “super clubs” on the island of Ibiza such as Pacha, Amnesia, and Eden that are popular with tourists, produces annual revenue of some 20 billion euros ($22 billion), according to the FNEOE.

Getting it restarted will depend on the approval of the government, which has so far only allowed bars to open outdoor terraces, and with limited capacity. There is no word yet on when nightclubs will be allowed to open.

“These guidelines were drawn up by doctors to try to ensure that people can enjoy an essential part of the Spanish life in a safe way,” said FNEOE spokesman Vicente Pizcueta, adding that he hoped things will return to normal in July.

Source: Read Full Article

Wall Street and Fed fly blind as coronavirus upends annual stress tests

WASHINGTON (Reuters) – U.S. financial regulators, banks and their investors will get their first glimpse into the health of the nation’s banking system as it confronts soaring corporate and consumer defaults in the economic crisis sparked by the novel coronavirus.

And no-one, including the U.S. Federal Reserve which sets the annual bank “stress test” exams, has a clue what to expect.

“That is the $100,000 question. Actually, it’s much bigger than that and I am sure the Fed is working hard to get it right. We’re curious, and we don’t have clarity,” said Kevin Fromer, CEO of the Financial Services Forum, which represents the biggest banks in the U.S.

That could mean banks may be on the hook for billions more in capital than they had anticipated, which could ultimately force them to slash dividends, slim down their balance sheets or reduce lending.

Since the 2009 financial crisis, the Fed has tested annually a snapshot of big bank balance sheets against an extreme hypothetical economic shock. The results ultimately dictate how much capital banks can dish out to shareholders.

This year, however, the real life economic blow dealt by the pandemic has by several measures exceeded the doomsday scenario the Fed unveiled in February, leading some banks to grumble it may as well scrap the tests this year.

Instead, the Fed told banks after they had handed in their exam papers in April that it was adding an extra test to reflect the rapid deterioration of economic conditions in recent months.

That eleventh-hour change combined with other tweaks the Fed passed last year has thrown the stress test playbook out the window.

Related Coverage

  • Factbox: What's new with the Fed's 2020 bank stress tests?

“Unnecessarily increasing bank capital could serve to limit bank balance sheets at exactly the wrong time, likely chilling economic recovery,” the Securities Industry and Financial Markets Association wrote in a note on Friday in which it urged the Fed to stick to its original plan.

While the banking sector has so far proved resilient, some Fed officials worry it will come under greater stress as mass unemployment leads to more corporate and consumer debt defaults, according to minutes from the Fed’s April meeting.

The country’s largest four lenders – JPMorgan Chase & Co (JPM.N), Wells Fargo & Co (WFC.N), Bank of America Corp (BAC.N), and Citigroup Inc (C.N) – combined put aside $20 billion to cover expected loan losses in the first quarter alone. Those lenders, alongside Goldman Sachs Group Inc (GS.N) and Morgan Stanley (MS.N), are among the 34 banks to best tested this year.

Banks say they are in the dark about the potential outcome because the Fed hasn’t provided any details on how the extra analysis will work or which factors it plans to probe.

Some analysts expect the central bank to adjust for more job losses, which has already blown through the 10% level outlined in its February scenario, and to significantly raise lenders’ potential loan loss rates from the roughly 6% of previous years.

Nellie Liang, a former Fed official who is now a senior fellow at Brookings Institution, said the central bank will likely also probe banks’ exposures to struggling sectors like hotels.

“From a credibility standpoint, they need to be very severe, not just try to catch up with what’s already happened,” said Tim Clark, another former Fed official who helped build the stress tests and now works with the advocacy group Better Markets.

Regulatory changes to the tests agreed before the pandemic have created another unknown. This year the Fed will integrate the stress test results with other capital rules so as to better tailor banks’ overall capital level to their business mix.

Analysts at Keefe, Bruyette & Woods and Evercore ISI have said they expect the tests to result overall in less excess capital which may force banks to cut dividends. While the Fed declined to comment, some officials have said lenders should be prepared for that outcome, according to the April minutes.

But with pressure from the government and lawmakers to keep banks lending, some analysts are leaning the other way. Goldman Sachs said in a note last week that while the Fed could order higher bank capital, it may actually lower requirements “given the extra-ordinary demands on balance sheets.”

Source: Read Full Article