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Last updated: October 30, 2012 8:01 pm
Businesses and residents across the northeast US face billions of dollars of losses and days of disruption after hurricane Sandy swept through the region.
The storm rolled inland on Tuesday having caused the deaths of at least 40 people in the US and Canada, cutting power to more than 8m people and flooding Wall Street and much of lower Manhattan.
After being closed for two days, the New York Stock Exchange plans to resume normal trading on Wednesday. But Michael Bloomberg, New York mayor, said it could be at least three days before electricity supplies were restored to the 750,000 people in the city who lost power, and four days before the subway was running again.
New York’s subway suffered the worst damage in its 108-year history, with seven of the 10 tunnels under the East River flooded.
Andrew Cuomo, governor of New York state, admitted that officials had not been prepared for the scale of the storm surge as rivers burst their banks, flooding tunnels and power infrastructure.
A record 14ft storm surge hit southern Manhattan on Monday night – about 4ft above the previous record, set in 1960. Hundreds of vehicles and buildings were damaged in New York and surrounding areas as underground garages, basements and ground floors were flooded.
Business life was disrupted in the US financial centre, with the release of some company results and economic data delayed.
Many businesses told staff to work from home. Proximity to the Hudson River caused problems for some Wall Street banks including Goldman Sachs and Citigroup. Goldman piled hundreds of sandbags around its West Street headquarters and relied on its rooftop generator to keep the lights on even as other buildings in Lower Manhattan went dark.
While the damage was still being assessed as the storm passed inland, insurance experts estimated that it would be measured in billions of dollars.
Gregory Daco and Nigel Gault of IHS Global Insight said early estimates of infrastructure damage stood at $20bn. Factoring in disruptions to commercial activity and the idling of many of the region’s oil refineries, they said the total economic impact could reach $30bn-$50bn.
Jeanne Salvatore of the Insurance Information Institute said she expected the storm to be one of the 10 most costly insured catastrophes in US history: “It will be greater than Irene, which saw property losses of $4.3bn, but far less than Katrina, which saw losses of $41bn.”
Those losses exclude flood damage, which in the US is generally covered not by commercial insurers but by the government’s National Flood Insurance Program, which is likely to also face heavy losses.
One of the worst-hit areas in lower Manhattan appeared to be around South Street Seaport, where retailers including Abercrombie & Fitch, Body Shop, Ann Taylor and Gap were among those suffering damage. Flood waters destroyed shop floor displays and many windows were smashed.
It was unclear how long it would take Consolidated Edison, the utility company that supplies power to New York, to restore electricity, either in the areas where it voluntarily shut down the grid on Monday evening or in the wider swath of the city plunged into darkness by the storm.
Several grocery stores opened even in darkness, as residents sought supplies. Office buildings with their own emergency generators, not least Goldman Sachs, kept the lights blazing, though employers encouraged staff to stay home.
The major underpass around the financial district was a basin of water. Buildings at the East River end of Wall Street sustained damage, but on higher ground near the New York Stock Exchange the clean-up efforts that got under way at dawn were limited to clearing the streets of debris – from plants and branches to road signs and newspaper dispensers – that had been blown around in the night.
New York’s three main airports – JFK, Newark and La Guardia – all suffered flooded runways and were closed Tuesday. Mr Cuomo said JFK, the busiest international hub, might reopen Wednesday. More than 18,100 flights have been cancelled since Sunday, according to FlightAware, the air tracking website.
Airports in Washington, Boston, Philadelphia and Baltimore were operational on Tuesday morning.
Three nuclear reactors in New York and New Jersey were shut down as a result of the storm, according to the government’s Nuclear Regulatory Commission.
On the New Jersey coast, which bore the brunt of Sandy’s landfall on Monday night, search and rescue teams were beginning operations to reach stranded people in several towns including Atlantic City, Governor Chris Christie said on Tuesday.
“The level of devastation on the Jersey shore is unthinkable,” he said.
Three towns in New Jersey were swamped with up to five feet of water after a natural berm on the Hackensack river was breached by the tidal surge. In total, 2.4m households in New Jersey were without power – twice the number affected by tropical storm Irene in 2011, Mr Christie said.
Campaigning in the US presidential election also came to a halt. President Barack Obama cancelled stump events and declared a major disaster in New York City, Long Island and parts of New Jersey, releasing millions of dollars in federal emergency aid. Mr Obama will visit New Jersey with Mr Christie on Wednesday.
Additional reporting by Robert Wright, Tom Braithwaite and Anjli Raval
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