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- Confirmed cases
- Total vaccination doses given
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Amazon is hiring another 100,000 workers in the US and Canada, in its fourth such recruitment spree this year, as it races to keep up with a surge in online shopping fuelled by social distancing restrictions and lockdowns.
The Macy’s Thanksgiving Day parade is reducing its number of participants, doing away with its multitudes of balloon “handlers” and going virtual as the iconic New York City event is reconfigured for the coronavirus pandemic.
The United Arab Emirates has approved the use of a coronavirus vaccine for frontline workers in the Gulf state.
Nicola Sturgeon, Scotland’s first minister, has called on the Westminster government to be more forthcoming about the scale and nature of a backlog in coronavirus testing.
Growth in eurozone industrial production slowed in July, driven by a faltering expansion in Germany and adding to concerns about the pace of the region’s recovery.
Pakistan’s prime minister promised to make sure schools follow public health rules as students prepare to return on Tuesday after closing for six months in an attempt to limit the spread of Covid-19.
New US coronavirus cases remain in line with recent tallies
Peter Wells in New York
The US reported an increase in coronavirus cases on Monday that fell roughly in line with recent averages.
A further 29,853 people tested positive for the disease, according to data from Covid Tracking Project, down from 34,453 on Sunday and compared with 28,682 a week ago.
While Monday figures tend to be lower than other days of the week due to weekend delays in reporting, Covid Tracking Project said its figures today came with an additional caveat, the omission of late data from Texas.
Although too late to make Covid Tracking Project's cut-off, the Lone Star state reported nearly 2,600 new infections and just over 1,416 historic cases, which would lift Monday's total to nearly 33,900. Over the past week, the US has averaged nearly 34,600 new cases a day.
A further 382 people died from coronavirus, according to Covid Tracking Project, but this excludes 21 new fatalities in Texas. That compares with 389 yesterday and with 225 last Monday.
California (56) and Florida (36) had the most new deaths, while Kansas (23) and Wyoming (4) were the only two states to report record one-day increases.
Texas reports smallest number of new Covid-19 deaths in a week
Peter Wells in New York
Texas reported its smallest daily jump in coronavirus deaths in a week, but its efforts to clear a backlog of historical tests has brought it close to surpassing Florida as the US state with the second-highest tally of confirmed cases since the start of the pandemic.
A further 2,595 people tested positive for Covid-19 in the Lone Star state over the past 24 hours, up from 1,840 on Sunday and compared with 2,057 new cases a week ago.
A combined 1,416 historical cases from the regions surrounding Dallas and San Antonio, stemming from a backlog of tests, were added to the statewide total, but omitted from today's total.
That took the total number of confirmed cases in Texas since the start of the pandemic to 663,445, which is just 2,285 shy of Florida, the US state with the second-highest number of infections. California leads with nearly 758,000 cases.
A further 21 people died from Covid-19, state health authorities revealed this evening, down from 47 on Sunday and compared with 20 a week ago. Over the past seven days, Texas has averaged about 100 deaths a day.
Texas has reported 14,211 coronavirus-related fatalities since the start of the pandemic, 174 short of California's tally, which is the third-highest among US states.
Monday figures tend to be lower, owing to weekend delays in reporting. Comparisons with the previous week may be complicated by last Monday's Labor Day holiday.
Asia-Pacific equities lack direction ahead of central bank meetings
Alice Woodhouse in Hong Kong
Asia-Pacific stocks made a mixed start to Tuesday morning ahead of central bank meetings later in the week and despite a positive day on Wall Street after tech sector deals provided a boost.
Japan’s Topix was down 0.7 per cent, the Kospi in South Korea was flat and the S&P/ASX 200 in Australia edged up 0.1 per cent.
Investors are waiting on pointers from central banks, including the US Federal Reserve, this week for any additional support for economies hit by the pandemic.
Overnight on Wall Street, the S&P 500 rose 1.3 per cent and the tech-heavy Nasdaq added 1.9 per cent. Sentiment improved after Oracle said it had struck a deal with ByteDance over TikTok’s US operations, which was seen as smoothing recent US-China tensions.
Futures tip the S&P 500 to fall 0.1 per cent when trading resumes in the US.
Victoria reports no new Covid-19 deaths for first time in two months
Alice Woodhouse in Hong Kong
Australia’s state of Victoria reported 52 new coronavirus cases on Tuesday morning and recorded no new deaths for the first time since July.
The state has recorded 729 deaths linked to Covid-19 and the number of fatalities linked to the virus have slowed in recent weeks from a one-day peak of 59 lives lost earlier this month.
Victoria’s health department said the 14-day rolling average for Melbourne stood at 52.9 cases, down from 54.4 a day earlier while that for regional Victoria was 3.6 from 3.9 previously.
Lockdown measures will be eased when the rolling average falls to 50, the state’s government has said.
UK business schools report jump in MBA applications
Jonathan Moules in London
Applications to MBA courses in the UK have risen sharply since lockdown began, with several British schools celebrating record numbers of applications for courses starting this month, according to the Financial Times’ global MBA ranking list.
Business schools not only run the most popular degree programmes on UK campuses, but generate higher returns per student than other academic departments from their postgraduate qualifications.
They also attract greater proportions of overseas students, who are more likely to pay full tuition fees for their studies than domestic applicants.
Their bumper enrolment this year will help their parent universities as they invest heavily in online teaching and battle demands for refunds from students upset about being unable to attend campus lectures due to Covid-19.
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China retail sales grow for first time since coronavirus outbreak began
Thomas Hale in Hong Kong
China's retail sales have returned to growth for the first time since the coronavirus pandemic emerged, in a sign that consumer spending is catching up with the country's wider economic recovery.
The metric, which tracks sales of retail goods and catering services, rose 0.5 per cent in August compared with last year. Economists had anticipated no change compared with a year earlier.
Retail spending had been a weak spot in China's recovery from the coronavirus outbreak, which was originally fuelled by strong industrial growth at a time when households remained cautious over spending and the risk of fresh outbreaks.
The reading had fallen for the first seven months of the year.
Asian developing economies set to shrink for first time since 1961
John Reed in Bangkok
Asia’s developing economies will contract this year for the first time in six decades as the Covid-19 pandemic takes a toll on a crucial driver of global growth, according to the Asian Development Bank.
The ADB said in a new report that developing economies across Asia would on average show negative GDP growth of 0.7 per cent this year.
"This will be the first regional contraction since the early 1960s,” Yasuki Sawada, the bank’s chief economist said ahead of the report’s launch. Mr Sawada said that the fall would be the sharpest since 1961, when regional growth contracted by 8 per cent.
The Manila-based development bank forecast that the economies would rebound in 2021, growing on average by 6.8 per cent.
But it noted that this would still be below its pre-Covid-19 projections — implying a partial rather than a full recovery. It said a prolonged pandemic that would require renewed lockdowns could “derail the recovery”, and was the biggest risk to the region’s growth this year and in 2021.
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China’s currency hits 16-month high on retail spending boost
Hudson Lockett in Hong Kong
China’s currency hit its highest level in more than a year as retail sales rose for the first time in 2020, signalling the post-pandemic recovery is taking hold.
The onshore-traded renminbi strengthened as much as 0.3 per cent to Rmb6.7897 per US dollar early on Tuesday, its firmest level since May 2019. That coincided with official data that showed retail spending increased 0.5 per cent in August compared with a year ago. The less tightly regulated offshore-traded renminbi strengthened 0.3 per cent, past Rmb6.8 per dollar.
China’s central bank “has shown few signs of resistance to a stronger renminbi, paving the way for currency appreciation”, analysts at JPMorgan wrote in a note. They added that conditions were “favourable for less official resistance to foreign exchange strength overall, especially in the absence of obvious signs of renminbi overvaluation”.
The upbeat Chinese economic data also boosted the country’s stocks. The CSI 300 index of Shanghai and Shenzhen-listed shares was up 0.4 per cent, reversing initial losses. Hong Kong’s Hang Seng index added 0.5 per cent.
Elsewhere in the Asia-Pacific region, Japan’s Topix index was down 0.8 per cent and Australia’s S&P/ASX 200 was little changed.
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Western Australia considers using detention facilities for quarantine
Alice Woodhouse in Hong Kong
Western Australia’s premier said the state could accept more citizens returning to the country if immigration detention facilities were repurposed to quarantine arrivals.
Mark McGowan said he wanted to work with the national government to organise the use of its defence or immigration detention facilities, such as Christmas Island or Yongah Hill.
Residents returning to Australia must undergo a 14-day quarantine in dedicated hotels as part of measures to prevent the spread of coronavirus. There are currently 1,900 people in hotel quarantine in Western Australia.
“States have really been taking on this responsibility now for the last six months ... I have been co-operative with the Commonwealth along this road and working with them and that’s why I would like to work with them to get some of their facilities up and operational to take some of these people returning from overseas,” said Mr McGowan on Tuesday.
He suggested thousands of people could be quarantined in these facilities and warned that the state of Victoria’s experience meant it was important not to overwhelm the hotel quarantine system.
Australian states have been criticised by citizens trapped overseas who are unable to return owing to daily arrivals quotas and reduced numbers of international flights.
Economists warn of US ‘wasteland’ without stimulus deal
James Politi in Washington
The US economic recovery is in danger of being weaker and more uneven if Congress and the White House fail to agree on a new round of fiscal stimulus, according to mounting warnings from Wall Street and academic economists.
In recent weeks, hopes have faded for an accord before November’s election to pump $1tn or more in government money into the world’s largest economy through direct payments to households, enhanced jobless benefits and aid to small businesses and state and local governments.
The diminished chances of additional fiscal support have caused many economists to fret that the US rebound will lose steam in later 2020 or early 2021, creating a drag on the global economy as it tries to recover from the worst contraction since the second world war.
“The risk of fiscal fatigue where policymakers stop providing stimulus or start trying to claw back too early is a meaningful global risk,” said Nathan Sheets, chief economist for PGIM Fixed Income. “What’s going on in Washington right now is in some sense exhibit-A for that.”
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H&M expects return to profit on stronger than expected recovery
Richard Milne, Nordic and Baltic Correspondent
Hennes & Mauritz said its recovery from coronavirus lockdowns was stronger than expected and the world's second-largest clothes retailer now expects to make a profit in the third quarter.
The Swedish group predicts a pre-tax profit of about SKr2bn ($230m) in its third quarter, which runs from June to August, the retailer said on Tuesday. That is far above the consensus analyst forecast of SKr350m, according to Refinitiv.
"More full-price sales combined with strong cost control enabled the company to already turn to profit in the third quarter," it added.
H&M said its third-quarter revenues fell 19 per cent to SKr50.9bn compared with the same period a year earlier, just below the average analyst forecasts of SKr51.9bn.
At the start of June the Swedish retailer had 900 of its 5,000 stores closed due to Covid-19. By the end of last month, 200 were still closed.
Ocado sales rise 52% yet rivals do better
Jonathan Eley in London
Ocado Retail, the ecommerce venture half-owned by Marks and Spencer, reported a 52 per cent rise in quarterly sales amid expectations for a 14 per cent increase in full-year profit.
Revenue in the three months to the end of August climbed to £587m. The gain was driven largely by higher spending. An average basket size of £141 fell from the peaks seen earlier this year when coronavirus-related lockdown measures kept households at home. The basket size was well ahead of the same period a year ago.
Basket sizes had increased by about five items on average since the end of the period as the venture switched from Waitrose own-label products to M&S lines, while the share of M&S own-label products in the average customer basket was higher now than the typical Waitrose share, it added.
Orders per week averaged 345,000, 9.6 per cent higher than the same period last year.
Rivals such as Tesco, Sainsbury’s and Asda, which pick orders from stores rather than automated warehouses, have reported much larger increases in orders per week.
Tesco has doubled its capacity since the start of the year to well over 1m orders per week.
FirstGroup forecasts first-half profit as passengers return
Philip Georgiadis in London
Transport company FirstGroup expects to report a profit for the first half of its financial year as it was boosted by state support and the gradual return of passengers.
The rail and bus operator reported a "stronger than expected" financial performance for the five months between April and August, just two months after warning there was material uncertainty over its ability to continue as a going concern.
First Group expects to record a small adjusted profit for the six months to the end of September, ahead of expectations and following a £300m pre-tax loss for the year ending in March.
Although its passenger numbers were devastated by the pandemic this year, the company has received support to help keep its US school bus and UK trains businesses running.
FirstGroup said it had received "significant interest from potential buyers" of its US businesses, which it put up for sale this year following pressure from an activist shareholder.
The number of passengers on First's UK rail franchises, which include Great Western Railway, are about a third of pre-pandemic levels after slowly creeping higher throughout the summer.
European retailers’ shares buoyed by positive earnings
Naomi Rovnick in London
Investors snapped up the shares of European consumer groups after positive financial results from some major retailers signalled brighter prospects for the pandemic-struck sector.
Shares in H&M jumped 12 per cent on Tuesday after the world’s second-largest clothing retailer reported stronger than expected trading since its stores reopened after coronavirus shutdowns. The group expects to make a profit in the third quarter.
Zara owner Inditex was buoyed by H&M's news, with its shares 4 per cent higher in early trades.
The Spanish retailer reports first-half earnings on Wednesday, where it will reveal recent sales trends and whether its cost-cutting measures have been as successful as H&M's, which exceeded analysts' expectations.
British online retailer Ocado, which recently switched its main food delivery partnership from supermarket group Waitrose to its rival M&S, traded 6 per cent higher after reporting that the M&S tie-up had gone well, with strong customer demand for the new range. M&S shares rose by 5 per cent.
The consumer cyclical sector of the Europe-wide Stoxx 600, a group of companies whose fortunes are determined by the wider economy, was the index’s best performer, rising 0.8 per cent overall.
In the UK, the consumer segment of the FTSE 100 rose by 1.2 per cent, against a gain for the index of 0.2 per cent. Takeaway provider JustEat rose 2 per cent after issuing new shares, while sporting clothes retailer JD Fashions also traded 2 per cent higher, lifted by the positive mood surrounding retail stocks.
IEA warns on 'fragile' recovery in crude oil demand
Anjli Raval, Senior Energy Correspondent
The crude market outlook is more “fragile” than initially expected after the recovery in oil demand stalled as global authorities implemented new measures aimed at arresting the spread of coronavirus, the International Energy Agency said
In its monthly oil market report published on Tuesday, the Paris-based body said: “The uncertainty created by Covid-19 shows little sign of abating.”
New outbreaks of the virus in Europe and ever-higher case numbers in countries such as India, are weighing heavily on economic activity and would “lead to lower expectations for a recovery in energy demand”, the IEA said.
The initial sharp recovery, led by gasoline, has now lost momentum. “It is becoming increasingly apparent that Covid-19 will stay with us for some time,” the IEA added.
For 2020 on average, the IEA expects a fall in demand of 8.5m barrels a day, which is steeper than last month’s estimate. At a total of 91.7m b/d, demand will have returned to its 2013 levels.
Even as sentiment about demand is weakening, supply is still expected to go up as production cuts from Opec, Russia and other countries - agreed in April - continue to ease. Global oil supply rose by 1.1m b/d in August to 91.7m b/d, but this is still down 9.3m b/d versus a year ago
This means stockpiles will not shrink at the pace that the IEA once thought, keeping pressure on prices. Brent crude, the international oil benchmark, is back below $40 a barrel having recovered after hitting a low of about $20 a barrel in April.
The IEA said China’s crude purchases that had provided strong support to the crude market had slowed sharply. Separately, weak margins meant there was little incentive for refiners to keep buying. At the same time some of the world’s biggest oil traders are again chartering ships to store oil at sea.
“With the on-coming northern hemisphere winter, we will enter uncharted territory regarding the virulence of Covid-19,” the IEA said.
Czech Republic's rising ‘R’ number signals exponential Covid spread
Harry Dempsey in London
Czech Republic’s infection rate has surged over the past fortnight, as the central European country struggles to keep the spread of Covid-19 under control.
The reproduction, or R number, has risen to 1.59, pushing it above 1 in every region, raising the risk of coronavirus spreading exponentially, official health statistics showed on Tuesday.
If the R number is above 1, an outbreak expands exponentially — the higher the number the faster it grows. But the Institute of Health Information and Statistics said the figure is used for “orientation purposes” and other indicators are needed to evaluate the severity of an outbreak. The R number rose above the current level in March and at the end of June but daily cases are higher this time.
Daily confirmed coronavirus cases were above 1,000 on Monday for a sixth day out of seven. During Europe’s lockdowns in March and April, the highest daily tally of Covid-19 cases was below 400 in the central European nation and the caseload began trending higher at the start of September.
The capital Prague is the worst hit region with 142.12 people per million infected with Covid-19 in the last seven days, which is below the rate of infection in Spain but above that in France.
The number of people in hospital being treated for Covid-19 has increased to 305, up from 172 at the end of last month.
A number of countries including the UK have placed travel restrictions on Czech Republic, with Slovakia becoming the latest to require travellers from its neighbour to produce a negative Covid-19 test or quarantine for five days upon arrival.
Hong Kong steps up easing restrictions as Disneyland set to reopen
Nicolle Liu in Hong Kong
Hong Kong unveiled plans to relax social-distancing measures as the territory recorded no locally transmitted coronavirus cases for the first time since a third outbreak began in early July.
Authorities have been easing restrictions in the past weeks and have reopened museums, gyms and outdoor facilities.
Bars, party rooms, karaoke, swimming pools and theme parks including Disneyland and Ocean Park will be allowed to reopen from Friday. People will also be able to dine in until midnight, loosened from the previous 10pm limit.
However, restrictions limiting public gatherings to four people and mandating mask-wearing remain in place.
The government spent more than HK$500m ($64.5m) testing 1.78m people, about a quarter of the territory’s population, confirming 32 new cases.
Paul Chan, Hong Kong’s financial secretary, said the total budget for government relief measures hit more than HK$300bn, equivalent to 10 or 11 per cent of the territory's gross domestic product.
The financial deficit for 2020-21 will be more than HK$300bn and the fiscal reserves will fall to about HK$800bn, close to the post-2003 Sars level.
Eurozone job seekers face challenges after record fall in vacancies
Valentina Romei in London
Job vacancies in the eurozone dropped at the quickest pace on record in the first six months of the year as the pandemic hit the labour market even as government measures propped up workers.
The eurozone job vacancy rate — the number of vacant jobs as a proportion of all jobs — dropped to 1.6 per cent in the second quarter, down from 1.9 per cent in the previous quarter, official Eurostat data showed.
This is the joint largest quarterly drop since records began in 2006, mirroring the drop in the previous three months, suggesting that workers entering or returning to the job market face rising challenges.
Despite support for jobs across the continent via government-led furlough schemes, falling employment and dropping job vacancies show that the region's labour market is rapidly deteriorating.
Across the eurozone, southern European countries such as Greece, Spain and Italy show among the lowest vacancies rates, below 1 per cent. In contrast, job vacancies in Germany are above the eurozone average at 2.1 per cent, despite a 0.5 percentage points drop compared with the previous quarter.
Job prospects deteriorated across all sectors in the eurozone, but the fall was steeper in professional and scientific services. In the manufacturing sector, job vacancies dropped for the first time below 1 per cent since consistent data was produced in 2006.
German investor confidence soars on brightening outlook
Investors are becoming more bullish about a German economic rebound despite concerns over rising infections and the impact of Brexit, a survey published on Tuesday showed.
The Zew poll of German investors found that sentiment about the outlook for Europe’s largest economy had surged to its highest level for 20 years, as the country seems to be emerging faster than expected from its deepest postwar recession.
“The experts continue to expect a noticeable recovery in the German economy,” said Achim Wambach, Zew president. “The stalled Brexit negotiations and the increasing number of corona[virus] infections could not slow down the positive mood.”
But Mr Wambach said investors remained deeply pessimistic about the outlook for the German banking sector, which he said “points to fears of an increasing number of loan defaults in the next six months”.
The Zew survey of 178 analysts and investors last week found that sentiment about the German economic outlook rose by 5.9 points month-on-month to reach a 20-year-high of 77.9. Sentiment about the current economic situation improved, albeit from a lower level, rising 15.1 points month-on-month to minus 66.2.
Last week, the economy minister Peter Altmaier said the resilience of the country’s labour market would help it achieve a sharp, V-shaped recovery. He predicted an economic contraction of 5.8 per cent, compared with an earlier forecast for a decline of 6.3 per cent.
German health authorities on Tuesday reported 1,407 new coronavirus infections in the past day, an increase from the daily average of the past week but well below the peak levels in April, according to the Robert Koch Institute.
However, the Munich public prosecutor is investigating a 26-year-old American woman suspected of being a “super-spreader” after she visited several bars in Garmisch-Partenkirchen despite having symptoms of the virus - prompting about 1,000 people in the Bavarian town to be tested.
Carnival losses expected to near $3bn in third quarter
Mamta Badkar in New York
Carnival expects a $2.9bn loss in the third quarter as a no-sail order remains largely in place for US cruise operators as the coronavirus pandemic drags on the travel industry.
The Miami-based company plans to raise $1bn through a stock offering, having tapped the bond market this year in its efforts to raise billions of dollars.
The world’s largest cruise operator's preliminary net loss included a non-cash impairment charge of $937m, it said on Tuesday. Adjusting for one-time items the group expects to post a loss of $1.7bn in the three months ending in August.
Carnival shares, which have fallen 70 per cent this year, declined more than 2 per cent in pre-market trade.
The travel industry has struggled as the Covid-19 pandemic that has killed nearly 930,000 worldwide, weighs on business. The US Centers for Disease Control and Prevention issued a no-sail order effectively suspending voyages until the end of September or until the secretary of health and human services declares that Covid-19 is no longer a public health emergency.
Carnival's Italian brand Costa Cruises completed its first voyage this month. Carnival planned to resume operations with additional voyages on its Costa ships and with its German brand AIDA cruises this autumn.
Advanced bookings for the second half of 2021 are "at the higher end of the historical range, despite minimal advertising or marketing", the group said.
"Our business relies solely on leisure travel which we believe has historically proven to be far more resilient than business travel and cannot be easily replaced with video conferencing and other means of technology," said Arnold Donald, chief executive.
Eighteen of Carnival's less efficient ships have left or are being removed from its fleet, representing 12 per cent of capacity before the pandemic paused sailing. The company ended the third quarter with $8.2bn of cash and cash equivalents.
UK to prioritise tests to meet demand, says Hancock
Jasmine Cameron-Chileshe in London
The UK health secretary has said that the government will begin to prioritise coronavirus tests as demand has increased over recent weeks.
“As demand has risen so we are having to prioritise once again and I do not shirk from decisions regarding prioritisation," Matt Hancock said on Tuesday. "They are not always comfortable but they are important.”
Addressing the House of Commons, Mr Hancock added: “The top priority is and always has been acute clinical care; the next priority is social care and where we are now sending over 100,000 tests a day."
Mr Hancock defended his record on testing, arguing that despite the “operational challenges”, the UK has conducted more than 20m tests. It is carrying out more testing per head of population than “almost any other major nation”, he said.
“The challenge is to make sure that we prioritise the tests we have as a nation to those who most need it.”
The UK’s testing capacity is 374, 917, the latest figures show, with the government hoping to increase that figure to 500,000 by the end of October.
Mr Hancock has come under fire in recent weeks, following a range of issues with the system, including alleged testing shortages in hotspot areas such as Bolton and Salford.
On Tuesday, Lindsay Hoyle, speaker of the House of Commons, described the testing delays as “completely unacceptable”.
Writing on Twitter, Sir Lindsay said: “I am receiving numerous complaints from residents unable to book a test after displaying Covid symptoms. This is completely unacceptable and totally undermines track and trace so I have raised my concerns with ministers to push for action to be taken as a matter of urgency.”
Kraft Heinz plans to cut $2bn in costs
Kraft Heinz has laid down plans for another $2bn worth of cost cuts and new financial targets as the food group seeks to convince Wall Street it can recover from a protracted period of underperformance.
While demand for packaged fare has picked up during the pandemic, Kraft Heinz fell to a $1.65bn loss in its most recent quarter on another round of writedowns. Shares in the company, backed by Warren Buffett and investment group 3G Capital, have fallen 59 per cent since the start of 2018.
Despite the latest cost cuts, which Kraft Heinz expects to deliver between 2020 and 2024, chief executive Miguel Patricio said on Tuesday that the company — long criticised for starving brands of investment — no longer had a “cost-cutting mentality”.
“Instead of only dropping savings to the bottom line today we are reinvesting those savings in the business to fuel our growth,” he said. At a virtual investor day, the Chicago-based company provided new “long-term” financial targets, including to deliver organic net sales growth of between 1 and 2 per cent and adjusted earnings per share growth of between 4 and 6 per cent.
Shares rose 2 per cent in pre-market trading.
New York manufacturing gauge jumps in September
Mamta Badkar in New York
A gauge of business activity in New York state rose more than expected in September though economists caution the initial manufacturing rebound is over.
The general business conditions index rose 13 points to 10, its third straight positive reading, according to the New York Federal Reserve. That exceeded economists' expectations for a rise to 6.
The new orders index climbed nine points to 7.1, while there was a "significant increase" in shipments. Employment was little changed the report showed even though the average workweek picked up.
However, it is worth noting that New York’s manufacturing sector is not a significant driver of economic activity in the state or the country. Economists remain divided over the outlook for manufacturing and industry.
The manufacturing sector has rebounded as coronavirus-related lockdown measures have eased. But it is expected to lose momentum as workers who received enhanced unemployment benefits worth about $80bn a month, or 4.5 per cent of gross domestic product, are expected to cut their spending. Businesses plan to lower their capital spending as well.
"The big picture here is that the manufacturing upturn probably continues, but the initial rebound is over," Ian Shepherdson, economist at Pantheon Macroeconomics said. "A full return to the pre-Covid level of activity likely will have to wait until after a vaccine and an upturn in business capex."
Sweden to ease restrictions on care home visits
Richard Milne, Nordic and Baltic Correspondent
Sweden is loosening some of its coronavirus-induced restrictions, allowing visitors to its elderly homes for the first time in months, as the rest of Europe looks at imposing more measures to stop a recent rise in cases.
The ban in Sweden on visiting care homes will be phased out at the start of October, the centre-left government and public health agency said on Tuesday.
Health officials said elderly people had been harmed by the ban but urged visitors to act responsibly.
“It is a risk when we lift the ban. I now want everyone to take responsibility,” said Lena Hallengren, Sweden’s minister for social affairs.
Sweden’s lighter-touch response to the pandemic came under scrutiny in April, May and June as a large number of deaths in its elderly homes led it briefly to have the highest per capita Covid-19 death rate in the world.
But since July the number of cases in Sweden have fallen, even as they have risen in most other European countries.
Meanwhile, bars, restaurants and private parties in and around the Danish capital Copenhagen will have to close at 10pm for a two-week period from October 1, authorities said on Tuesday, as they fight to bring a rising infection rate under control. Customers will have to wear face masks whenever they are not seated.
Germany says 'no risky short-cuts' for vaccine development
Guy Chazan in Berlin
Germany expects no coronavirus vaccine to be available to the wider population before the middle of next year as the government insists Europe will refuse to bow to any pressure to hurry research through.
Anja Karliczek, research minister, said safety must be the priority and a vaccine can only be used when the benefit derived from it is greater than the risks.
"We in Germany and in Europe will not deviate from this line," she told reporters. "Even when the world is waiting for a vaccine — we won't take risky short-cuts here."
The German government has set aside some €750m to fund biotech firms working on Covid-19 vaccines. The funds will pay for clinical studies and for the preparation and distribution of coronavirus vaccine shots.
Some €252m will go to Curevac, the Tübingen-based firm that raised $213m in a US stock market listing last month, and €375m to BioNTech.
Both use messenger RNA technology, which aims to transcribe some of the pathogen's genetic code into human cells in order to help them detect it.
Ms Karliczek's ministry is still in talks with a third company, IDT Biologika, based in Dessau-Rosslau, which is working on its own viral vector vaccine. It is still unclear how much funding the company will receive.
The WHO says that there are currently 170 coronavirus vaccine projects worldwide, with 26 of them currently undergoing trials.
Russia shocked much of the global medical community last month when it approved its "Sputnik V" vaccine against coronavirus for civilian use. Some researchers were concerned that Moscow had made the move before completing so-called Phase 3 trials and without releasing any research on the vaccine.
US industrial output cools as manufacturing slows pace
Mamta Badkar in New York
US industrial output posted its weakest gain in four months as the manufacturing sector lost momentum and seasonal storms hit mining activity.
Industrial production, a gauge of output from factories, mines and utilities, rose 0.4 per cent in August from the previous month, the Federal Reserve said on Tuesday. That was slightly worse than economists’ expectations for a 1 per cent increase, according to a Reuters survey of economists, and followed a 3.5 per cent rise in July.
While output expanded for the fourth consecutive month, the index remains 7.3 per cent below its pre-pandemic levels.
The report showed manufacturing rose 1 per cent as "the gains for most manufacturing industries have gradually slowed since June", the Fed said.
Mining output fell 2.5 per cent as "Tropical Storm Marco and Hurricane Laura caused sharp but temporary drops in oil and gas extraction and well drilling", while output from utilities slid 0.4 per cent — the first decline in three months for both industries.
Economists have cautioned that the outlook for the industrial economy remains clouded as consumers and businesses retrench spending after the initial ease of lockdown restrictions and in the absence of a coronavirus vaccine.
Wall Street rises boosted by data and tech
Camilla Hodgson in London
A slew of encouraging economic data boosted US stocks on Tuesday as investors bet on a recovery from the worst effects of the pandemic.
The blue-chip S&P 500 index climbed 1 per cent while the tech-heavy Nasdaq Composite rose 1.4 per cent. Apple was up 2 per cent in early-morning trading, but cruise operator Carnival, which has been hit hard by the pandemic, sank 5 per cent on quarterly results that indicated heavy losses.
The moves come ahead of a two-day Federal Reserve meeting that begins on Tuesday, which investors will be closely watching for renewed stimulus measures and longer-term forecasts.
Earlier on Tuesday, China’s currency hit its highest level in more than a year as a rise in retail sales signalled that a recovery in the world’s second-biggest economy may be taking hold. More positive data came from the New York Fed, which published a manufacturing survey that beat forecasts.
And in Germany, investor sentiment about the future of the economy surged to its highest level for more than 20 years, substantially beating expectations, although respondents remained strongly negative about current conditions, the Zew survey of financial market experts revealed on Tuesday.
Oxford and AstraZeneca vaccine trial still on pause in US and South Africa
Clive Cookson in London
Oxford university and AstraZeneca are still waiting to resume the US and South African arms of the international clinical trial of their proposed coronavirus vaccine, though the study has started up after a six-day pause in the UK and Brazil.
The trial was suspended everywhere on September 6 when a participant fell ill with inflammation of the spinal cord. It resumed in the UK last Saturday when an independent review panel and the Medical and Healthcare products Regulatory Agency decided that it was safe to do so.
The Brazilian authorities quickly followed the UK lead, but regulators in the US and South Africa wanted more time to review the vaccine’s safety.
In a brief statement, Oxford said: “We can confirm all sites in UK and Brazil have restarted, USA and South Africa are still on pause. We plan to announce when all global trials have restarted.”
The partners declined to speculate on how long the US pause would last. But one person close to the trial said it was not surprising for the Food and Drug Administration to spend a few more days reviewing the evidence.
Altogether 18,000 individuals have received the AZD1222 vaccine as part of the trial.
Ireland to keep non-food pubs closed as part of new Covid restrictions
Arthur Beesley in Dublin
Ireland has imposed new coronavirus restrictions on Dublin because of rising infections, keeping non-food pubs closed in the city and placing limits on social gatherings.
The move came as Micheál Martin’s government introduced a seven-month plan setting out guidance for gatherings, weddings, funerals, and sporting and arts events according to the severity of the pandemic at any given time in the country.
Ireland is currently deemed to be at level two on a five-point scale of restrictions — with level one denoting the least intrusive measures while level five denotes the most severe. But Mr Martin said some additional steps were required to curtail infections in Dublin, after more than a 10-fold rise in infections in the past two months.
“Current Covid numbers in Dublin are very worrying,” Mr Martin told reporters. “I would say to the people of Dublin and indeed the country, rising rates of infection can be reversed by concerted public action and by all of us adhering to the guidance and taking personal responsibility.”
Non-food pubs closed since March will remain shut in Dublin but establishments outside the capital can reopen from September 21, three months after pubs that served food reopened. No more than two households can meet at any given time in Dublin, and people in the city were told they could have a maximum of six visitors from one other household to their home.
Mr Martin said Ireland would “broadly support” European Commission plans for a common approach to EU travel, in which there would be no restrictions on a “green” list of countries with a 14-day cumulative rate of virus incidence per 100,000 of 25 or less.
Florida cases and deaths rise by the most in several days
Peter Wells in New York
Florida reported its largest daily increases in new coronavirus cases and deaths in several days on Tuesday, although trends in the state have remained encouraging.
A further 3,116 people tested positive, state authorities revealed this morning, up from yesterday's three-month low of 1,736, and compared with 1,823 a week ago.
Last Tuesday's figures may have been on the low side due to potential reporting delays stemming from the Labor Day long weekend.
Fatalities rose by 146, from an increase of 36 on Monday and compared with 44 last Tuesday.
Of the nearly 69,000 people in Florida who took tests over the past day, 4.22 per cent tested positive for the first time. That was up from 3.86 per cent yesterday and compared with 4.92 per cent a week ago.
Ireland’s cabinet to restrict movements after health minister falls ill
Arthur Beesley in Dublin
Ireland’s premier Micheál Martin and his entire cabinet have been directed to restrict their movements after the health minister fell ill, leading him to be tested for coronavirus.
The development, only hours after the government set out a new masterplan to tackle the pandemic, led to the suspension of parliament because no ministers were available to conduct business in the assembly.
Stephen Donnelly, health minister, had attended a Tuesday morning cabinet meeting before a press conference at which he, Mr Martin and deputy premier Leo Varadkar spoke at length to reporters about the new masterplan.
The entire cabinet was first stated to have been sent into self-isolation after Mr Donnelly said he felt unwell and contacted his doctor to seek a test. But a senior government official later said ministers were restricting their movements and were not self-isolating.
Seán Ó Fearghaíl, who is Speaker of the Dáil, said “very serious information” had come to light as he adjourned the house. “I’m told that arising out of events today, the cabinet must now self-isolate,” he said.
“Therefore, the possibility of proceeding with business does not arise and the house stands adjourned, I suspect until Tuesday next or until I’m directed by the taoiseach to reconvene.”
California cases top 760,000
Peter Wells in New York
California’s case count topped 760,000 on Tuesday, even as new infections and deaths rose by less than their recent averages.
A further 2,235 people tested positive over the past 24 hours, state health authorities revealed this afternoon, down from 2,885 yesterday. That compared with 2,676 last Tuesday and remained below the rolling average over the past week of 3,157 a day.
The latest increase pushed the number of confirmed infections in California since the pandemic began to 760,013, the highest total among US states.
A further 66 people in California died from coronavirus, 10 more than yesterday and compared with 32 a week ago. Over the past week, the state has had an average of 99 deaths a day, which is now the highest level in a week.
Authorities revealed the 14-day average of the percentage of people testing positive for Covid-19 dipped to 3.6 per cent, down from 3.7 per cent yesterday. That is the lowest level since the state began reporting the data at the start of April.
FedEx reports forecast-beating first quarter on strong parcel demand
Peter Wells in New York
Strong demand for international priority shipments and parcels being sent to homes in the US amid the coronavirus pandemic led FedEx to deliver forecast-beating fiscal first quarter.
Investors cheered the result in after-hours trading, pushing shares up 5.9 per cent to a two-year high.
Often regarded as a bellwether for economic growth because it ships everything from documents to machinery parts, FedEx described its result as “strong” but refrained from providing an earnings forecast for fiscal 2021. “While business demand improved in the first quarter, continued uncertainties cloud our ability to forecast full-year earnings,” Alan Graf, chief financial officer, said.
FedEx said its operating results were boosted by volume growth in its international priority and US domestic package services, although this was partially offset by “costs to support strong demand and to expand services”, as well as other coronavirus-related costs to ensure employee and customer safety.
The logistics group reported a 13.5 per cent year-on-year rise in revenue to $19.3bn in the three months to August 31, cruising past Wall Street’s mean estimate of $17bn.
Net profit jumped about 68 per cent from a year ago to $1.25bn, working out to earnings of $4.72 a share, and both comfortably ahead of the mean forecasts in a Refinitiv survey of analysts.
US stocks rise on signs of global economic recovery
Hudson Lockett, Camilla Hodgson, Naomi Rovnick and Richard Henderson
Encouraging economic data boosted US stocks on Tuesday as investors bet on a recovery from the worst effects of the pandemic.
The blue-chip S&P 500 index climbed 0.5 per cent while the tech-heavy Nasdaq Composite rose 1.2 per cent. Tesla and Netflix were up 7 per cent and 4 per cent respectively.
Oracle ended the day 2.5 per cent higher, buoyed by positive signs that its plan to acquire TikTok would proceed. The worst performer among blue-chips was cruise operator Carnival — which has been hard hit by the pandemic. The company’s shares sank 10.8 per cent after it said expected losses for the three months ending August 31 totalled $2.9bn.
The moves came as the Federal Reserve began a two-day meeting, which investors will be closely watching for renewed stimulus measures and longer-term economic forecasts.
Earlier on Tuesday, China’s currency hit its highest level in more than a year as a rise in retail sales signalled that a recovery in the world’s second-biggest economy may be taking hold.
The renminbi strengthened as much as 0.44 per cent to Rmb6.7124 to the US dollar in trading within mainland China, its firmest level since May last year. Retail spending increased for the first time this year, by 0.5 per cent in August compared with a year ago.
More positive data came from the Federal Reserve Bank of New York, which published a manufacturing survey showing activity that beat forecasts. The headline general business conditions index climbed 13 points to 17 in September, compared to expectations of 6, according to a Reuters poll, while new orders increased. Though the broader industrial production figures showed growth was cooling.
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