U.S. deaths from coronavirus could reach 200,000, markets are on a knife’s edge again amid a spiraling coronavirus death toll and economic catastrophe, and airlines around the world have been racing to raise funds to ensure their survival. Here are some of the things people in markets are talking about today.
President Donald Trump will extend guidelines for Americans to distance themselves from one another until April 30, and said his administration expects the peak of deaths in the U.S. coronavirus outbreak to be reached in about two weeks. Trump had previously aimed to return many Americans back to work by Easter Sunday holiday, April 12. The president’s latest announcement comes after National Institute of Allergy and Infectious Diseases Director Anthony Fauci said U.S. coronavirus deaths may reach 200,000. It’s a stark warning as debate rages about how soon to restart parts of the U.S. economy that have been shut down. The U.S. has almost 125,000 confirmed infections with more than 2,100 deaths, according to the running total from Johns Hopkins University. Meanwhile, Italy’s deaths fell for a second straight day, but Spain had its most daily deaths so far. Moscow’s mayor ordered residents to stay home. Lockdown measures to combat the spread of the coronavirus could last for months in the U.K., according to the Deputy Chief Medical Officer for England. Read more here.
U.S. equity futures sank at the open of trading by more than 2% and the yen edged higher. Investors kicked off the trading week with caution, assessing the latest increase in coronavirus deaths and further restrictions on the movement of people. The Aussie was lower after the country limited public gatherings to just two people. Meantime, South Africa’s rand tumbled to the lowest on record after Moody’s Investors Service downgraded the country’s debt to junk. Elsewhere, after a brief stretch of relative calm, bond traders are about to contend with an array of crosscurrents, from quarter-end pressures to a torrent of dire economic data. And cracks are appearing in emerging markets.
Airlines Raising Funds
Airlines worldwide raised more than $17 billion in bank loans in March to shore up their finances amid the coronavirus outbreak. U.S. carriers were the most active, borrowing $12.5 billion, according to data compiled by Bloomberg. Delta Air Lines Inc. is the top borrower this month, obtaining $5.6 billion, followed by Singapore Airlines, which secured a S$4 billion ($2.8 billion) bridge loan, and United Airlines Holdings Inc., which raised $2.5 billion. The airlines have borrowed new loans or drawn down on existing credit lines that they typically didn’t use before the health crisis.
Consumer Default Wave
As Covid-19 works its way through the rest of Asia, Europe and the Americas -- forcing countries into lockdown, driving up unemployment and pummeling small-business owners -- analysts say it’s only a matter of time before stretched households globally start to default on their loans. The early indicators from China aren’t pretty. Overdue credit-card debt swelled last month by about 50% from a year earlier, according to executives at two banks who asked not to be named discussing internal figures. Household debt-to-GDP ratios in countries including France, Switzerland, New Zealand and Nigeria have never been higher, according to a January report from the Institute of International Finance. In Australia, which has the highest household debt levels among G20 nations, the country’s largest lender said on Thursday that its financial assistance lines are receiving eight times the normal call volume. A similar surge in queries has flooded lenders in the U.S., where credit-card balances swelled to an unprecedented $930 billion last year and 3.28 million people filed for jobless benefits during the week ended March 21 -- quadruple the previous record.
India, Indonesia Lockdowns
India’s federal government has asked states to quarantine migrant workers for 14 days and prevent the movement of people across borders to contain the spread of the coronavirus across the South Asian nation. The number of confirmed cased rose to 979, including 25 deaths, Lav Agarwal, a senior official of the health ministry, said Sunday. Since Prime Minister Narendra Modi announced a 21 day lockdown in the country on Tuesday, there’s been a large movement of people out of large cities. And Indonesia may soon quarantine almost 30 million people in its capital and surrounding areas to curb the spread of the coronavirus that’s killed more than 100 people in the world’s fourth-most populous nation. The plan for a shutdown follows a spike in confirmed cases, with the number of infections in Jakarta reaching 675, more than half the country’s total. The pandemic has killed 114 people, the highest in Southeast Asia.
What we've been reading
This is what's caught our eye over the last 24 hours.
- Singapore’s virus battle intensifies as industries die.
- Australia to unveil wage subsidies, limits foreign takeovers.
- Prisoners riot in Thailand, reportedly over fears of coronavirus.
- China's corporate deleveraging campaign may be set back years.
- Jefferies Group CFO dies from coronavirus complications.
- Hong Kong to provide second round of financial aid for companies.
- Passengers on “death ship” plead for rescue as virus strikes.
©2020 Bloomberg L.P.