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New research predicts impact of lower productivity and workers quitting because of long-term illness after Covid-19

The impact of long-term illness suffered by people after Covid-19 infections is estimated to cost OECD countries a total of up to $135bn a year and will dog their economies for at least a decade, according to new research.

The projected hit to GDP from lower productivity, increased absences or employees quitting work altogether will dwarf extra health spending burdens stemming from the sickness, says the OECD study published on Wednesday.

The paper is a rare attempt to quantify the economic effects from so-called long Covid, which has a debilitating effect on sufferers but remains poorly understood scientifically and is patchily monitored for data collection.

“This work is important because it provides for the first time a comprehensive estimate of the economic burden of long Covid across EU and OECD countries,” said Guillaume Dedet, the publication’s co-ordinator and a senior health economist at the Paris-based organisation.

“It shows that the costs of Covid-19 did not end with the acute phase of the pandemic: the virus continues, and will continue, to weigh on societies and economies for years to come.”

The report forecasts losses of between 0.1 and 0.2 per cent of GDP, amounting to a total loss of $135bn annually across all OECD countries, in scenarios where “low or moderate” residual coronavirus transmission led to ongoing new cases.

The economic fallout of long Covid is “substantial and mainly stems from the indirect costs from reduced productivity and participation in the workforce”, the report said. Its predictions are probably an underestimate of the true burden, it added.

The OECD argues the repercussions are more serious because they add to existing problems, including sluggish growth and productivity in ageing workforces.

Economists have previously struggled to quantify the impact of long Covid on employment and economic growth because few countries continued tracking people who were affected by the condition after the pandemic’s peak.

The OECD drew on new survey evidence from the US, showing a lasting increase in health-related absence and exit from the labour market, as well as academic studies from the UK, Australia and elsewhere.

It said all available data from high-income countries gave a consistent message: “persistent post-infection symptoms are not only a health challenge but also a structural brake on economic output”.

The OECD’s 38 member states include leading economies in Europe, the Americas and east Asia, although China is not a member.

While many countries have developed policies for long Covid recognition and response, important gaps often remain, the report said. These include in the provision of long-term care pathways for patients and the training and support of healthcare workers.

Government action on long Covid is often focused on the health sector, with limited co-ordination with employment, education and social protection policies, the paper said.

Long Covid — defined as a condition lasting at least three months after the initial viral infection — has been estimated to affect 18mn adults in the US. Sufferers report symptoms including shortness of breath, fatigue and cognitive decline — brain fog — lasting months or years.

Scientists remain unsure about exactly why some people experience long Covid and how the condition should be treated. Research suggests the viral infection triggers a heightened immune response and chronic inflammation in long Covid sufferers, indicating that damping these could be a way to tackle the condition.

Elon Musk-led companies plan to work with semiconductor manufacturer at Terafab project planned in Texas

Elon Musk is partnering with Intel INTC 2.89%increase; green up pointing triangle on his ambitious Terafab project, which aims to build specially designed chips for SpaceX and xAI as well as for Tesla TSLA -2.87%decrease; red down pointing triangle.

In an announcement Tuesday, Intel said it would work with the companies to “design, fabricate, and package ultra-high-performance chips at scale.” The company also shared a photo of Chief Executive Lip-Bu Tan shaking hands with Musk, CEO of SpaceX and Tesla.

The partnership is a win for Intel, which has struggled in recent years, leading the company to cut its production capacity when demand was surging for data-center chips and when competitors like Nvidia and AMD have thrived.

Last year the Trump administration reached a deal to acquire an equity stake in the company for around $9 billion to help secure the American chipmaker’s business.

The U.S. government held 8.4% of Intel’s shares outstanding as of March 20, according to securities filings. The figure doesn’t include warrants that could increase the government’s equity stake in Intel.

Shares in Intel gained more than 3% in Tuesday trading.

“Terafab represents a step change in how silicon logic, memory and packaging will get built in the future,” Tan said on X.

Tesla and SpaceX confirmed the partnership in posts on X.

In March, Musk unveiled the plans for a single facility in Austin, Texas, to make chips to be used by SpaceX and xAI, which merged in February, as well as by the publicly traded Tesla. He pitched the project as an opportunity to quickly experiment on chip design by designing and manufacturing the chips in one facility.

The fab will make chips for use in Tesla’s robotaxis and Optimus humanoid robot, two areas of priority for the electric-vehicle maker as it shifts its focus to artificial intelligence-enabled products.

It will also make chips optimized for use in space, where SpaceX is planning to deploy huge numbers of satellites capable of handling AI computing tasks.

Companies, including Tesla, often design their own semiconductors but then need a supplier to actually make them in a so-called chip fab.

Musk’s companies have sourced chips from a range of suppliers, including Nvidia, Samsung and Taiwan Semiconductor Manufacturing. Musk has said that Terafab is needed because his companies’ demand for chips is slated to far outstrip the supply it can get from partners.

Javokhir Sindarov is destroying the competition for a spot in the world championship match. Even Magnus Carlsen is stunned.

American grandmaster Hikaru Nakamura was sitting at a chess board in Cyprus last week feeling absolutely stumped. The world’s No. 2 rated player, famous for his talents in speed chess, spent 67 minutes on a single move.

His opponent was a 20-year-old prodigy from Uzbekistan named Javokhir Sindarov. And Nakamura, competing for a shot at the world title, had no idea what to do against the player suddenly rocking the chess world.

After what seemed like an eternity of tortured reflection, Nakamura stumbled right into Sindarov’s trap.

“He just thought one hour and played the wrong move,” Sindarov said. “And after this, I take this advantage and played very well in my opinion.”

The victory left Sindarov in a commanding position at the Candidates tournament, where the winner gets the chance to play for the World Chess Championship. And through eight games, Sindarov’s play has catapulted him into the game’s rarefied atmosphere. With five wins and three draws, he has already tied the record for the most ever victories at the Candidates—and he still has six games to play before the event ends next week.

But few in the chess community saw this performance coming. Three players in the eight-man tournament came in with higher ratings than Sindarov and, as the most pressure-packed tournament in chess, the Candidates tends to reward experience. Sindarov, however, has been on the fast track to greatness since he was a preteen. The kid from Tashkent who was once the second-youngest grandmaster in history is finally having his star turn.

After Sindarov had breezed through his first five games with four wins and a draw, even Magnus Carlsen was blown away.

“Nobody,” Carlsen said, “expects you to go 4.5 out of 5.”

Nobody, except perhaps Sindarov. Born in the Uzbek capital, he learned with his grandfather as his coach and soon became one of the fastest risers in chess history. Sindarov is one of only five players ever to earn the title of grandmaster before the age of 13.

And even though his home country doesn’t have a long history of producing the world’s pre-eminent chess minds, there has never been a better time to be a competitive chess player from Uzbekistan. Back in 2004, another Tashkent native named Rustam Kasimdzhanov was crowned FIDE world champion, sparking a national wave of interest. The government pushed the game into schools and sponsored new chess clubs. By 2021, the president of Uzbekistan had signed a national decree, “On measures for the further development and popularization of chess and enhancing the system of training chess players.”

In other words, the Uzbeks were coming.

Soon, it became impossible to ignore Uzbekistan’s outsize presence on the international stage. Seven years ago, the country had no one ranked in the top 100 for men’s classical chess. But now a golden generation has risen together. There are now four Uzbeks in the top 50, including world No. 4 Nodirbek Abdusattorov.

Together, Abdusattorov and Sindarov were part of Team Uzbekistan when it won the 2022 Chess Olympiad, the most prestigious international competition. Their coach was none other than Kasimdzhanov, the former world champion.

“They have grandmaster training at an age, where at the corresponding age I didn’t know what a grandmaster was,” Kasimdzhanov said in 2024.

That Sindarov is now in a position to dream of a world title at all is due in large part to the vacuum at the pinnacle of chess since Carlsen’s withdrawal in 2022. The five-time champion from Norway had dominated the classical game for nearly a decade, before electing not to defend his title.

His exit cleared the way for a new generation of super grandmasters, including Ding Liren, the first world champion from China, and Gukesh Dommaraju, the youngest undisputed champion in history.

Now Dommaraju looks set to face one of the most creative players around. At the Candidates, one opponent tried to lead Sindarov away from the common lines that grandmasters tend to study, hoping that he could outwit the 20-year-old in a battle of instinct and intellect, not memorization.

But Wei Yi, the world No. 8, soon found himself scrambling. Through brilliant improvisation, Sindarov pulled out a victory—despite the disadvantage of having the black pieces.

“If I get a chance to play a dynamic position from either side,” Sindarov said, “I will always be very happy.”

Short positions rise sharply as traders eye economic fallout from Iran war

Hedge funds have amassed a record number of short positions against European stocks, in a bet that the region will be hard hit by the economic fallout from the Iran war.

The number of short disclosures against stocks listed in Europe increased to nearly 12,000 in the first three months of this year, according to figures from data provider Breakout Point. That is the highest level since short disclosure rules were introduced in 2012.

Short positions are required to be disclosed when they reach 0.5 per cent of a company’s issued share capital. The figures do not equate to 12,000 individual short positions as they could include funds adjusting positions multiple times, but they are a proxy for short-selling activity.

Europe “looks shortable in a time of crisis,” said Andreas Bruckner, a European equity strategist at Bank of America, pointing to the ongoing war in Iran. The region’s stocks — previously the “key beneficiary” in “a trade of global growth” — were now “most exposed to the energy crisis that is brewing”, he added.

Hedge funds AQR Capital Management and Two Sigma Investments are among those that have raised their bets against the continent’s equities, as the war against Iran sends shockwaves through global financial markets.

AQR Capital Management currently has 128 disclosed shorts in European-listed stocks, compared with 54 a year ago, while Two Sigma Investments’ disclosed shorts have risen from three to 85 over the same period, according to Breakout Point. The rise in short positions does not necessarily imply a negative view of the European market as a whole, as some funds balance their bearish bets with long positions in other stocks.

Brent crude has surged 50 per cent to around $110 a barrel since the start of the war, while TTF, the European natural gas benchmark, is up more than 50 per cent, prompting fears of an energy shock that could fuel inflation and damage economic growth. As a net energy importer, Europe is viewed as much more vulnerable than the US, a net exporter.

The continent-wide Stoxx Europe 600 index has fallen more than 5 per cent since the start of the war, erasing most of its gains for the year.

London-listed Wizz Air became Europe’s most shorted stock last month, after warning that the war in Iran would wipe out its profits this year due to the impact of plane disruption and higher fuel prices.

Short interest in the budget airline has nearly doubled since the start of the war to 15 per cent, while its shares have tumbled by more than a quarter over the same period. Rival airline easyJet has also become a short target.

Some funds see companies exposed to the health of the UK economy as vulnerable.

Citadel is among the hedge funds that have increased bets against British brickmaker Ibstock — a longstanding short target due to the UK’s low rate of housebuilding — in recent weeks, while DE Shaw has disclosed a short position in the company, taking total short interest to more than 12 per cent. The Iran war has intensified the sector’s woes, given its exposure to interest rate volatility.

“The UK seems to be a pretty easy target for short sellers,” said Emmanuel Cau, head of European equity strategy at Barclays. It is “always an area of scepticism and negativity for investors”, he said, adding that the war’s impact on energy prices and interest rates had “revived concerns about the UK consumer and cost of living crisis”.

AI disruption fears have also hit some European equities, as short sellers target those viewed as likely losers from the technology.

UbiSoft Entertainment, the video game maker behind Assassin’s Creed, became one of the region’s most shorted stocks after it announced a restructuring and cancelled or delayed upcoming games.

Commerzbank held talks with UniCredit over potential deal

German bank hits back after Italian lender accused it of failing to engage

Italy’s UniCredit and Commerzbank held talks about a potential takeover in recent weeks, but the German lender rejected the approach saying a deal did not offer sufficient upside for investors.

Commerzbank on Tuesday disclosed that the two European lenders had held talks to explore a potential tie-up before UniCredit accused the German bank of failing to engage in discussions about a transaction.

The announcement is the first time either side has disclosed talks about a possible deal, 18 months after UniCredit first revealed its stakebuilding in Commerzbank.

UniCredit last month launched a €35bn takeover bid for Commerzbank, stepping up its drawn-out pursuit of the German lender in the face of fierce opposition from Berlin.

However, the Italian bank’s chief executive Andrea Orcel said it did not expect to gain control of Commerzbank through the offer, which came with a meagre 4 per cent premium at the time of the announcement.

“Several interactions took place in recent weeks — the last one shortly before the aforementioned publications by UniCredit — to constructively explore the fundamentals and potential of the takeover offer that UniCredit had presented to Commerzbank shareholders,” the German lender said on Tuesday.

The broadside from the German bank comes after UniCredit last week accused it of failing to engage in talks about a potential transaction, arguing in investor documents that its bid was triggered by Commerzbank’s “a priori refusal to engage”.

Commerzbank said that interactions between the two sides had “not demonstrated sufficient value upside potential for its shareholders” beyond the bank’s current strategy as a standalone entity.

It added that UniCredit had shown “no willingness” to offer Commerzbank shareholders a “necessary adequate premium”. “Commerzbank currently sees no possibility of an amicable solution,” it said.

The Italian bank has amassed a 29 per cent holding in Commerzbank through a combination of share purchases and derivative transactions. Crossing the 30 per cent threshold would have triggered a mandatory takeover offer under German law, which precipitated last month’s offer.

Commerzbank’s board and Berlin have both voiced their opposition to UniCredit’s overtures, with the government, which still holds more than 12 per cent of the German bank, stating a desire for Commerzbank to remain independent.

The Italian lender is currently seeking approval from its shareholders for a capital increase to help finance the takeover offer.

Commerzbank on Tuesday also argued that it could deliver improved returns for shareholders independently, without the risks associated with a cross-border merger.

It will publish upgraded financial targets alongside its quarterly results on May 8, in a move aimed at reinforcing its standalone strategy and fending off the bid.

“A significant part of the potential outlined by UniCredit is not based on a combination of the two institutions and can therefore also be realised by Commerzbank independently, without the significant execution risks associated with a transaction,” the German bank said.

Shares in UniCredit were trading 0.8 per cent lower in afternoon trading in Milan, while Commerzbank’s share price was down 0.3 per cent in Frankfurt.

Commerzbank said it “remains open to discussions and proposals that create concrete value for its shareholders and stakeholders”.

UniCredit did not immediately respond to a request for comment.

Short positions rise sharply as traders eye economic fallout from Iran war

Hedge funds have amassed a record number of short positions against European stocks, in a bet that the region will be hard hit by the economic fallout from the Iran war.

The number of short disclosures against stocks listed in Europe increased to nearly 12,000 in the first three months of this year, according to figures from data provider Breakout Point. That is the highest level since short disclosure rules were introduced in 2012.

Short positions are required to be disclosed when they reach 0.5 per cent of a company’s issued share capital. The figures do not equate to 12,000 individual short positions as they could include funds adjusting positions multiple times, but they are a proxy for short-selling activity.

Europe “looks shortable in a time of crisis,” said Andreas Bruckner, a European equity strategist at Bank of America, pointing to the ongoing war in Iran. The region’s stocks — previously the “key beneficiary” in “a trade of global growth” — were now “most exposed to the energy crisis that is brewing”, he added.

Hedge funds AQR Capital Management and Two Sigma Investments are among those that have raised their bets against the continent’s equities, as the war against Iran sends shockwaves through global financial markets.

AQR Capital Management currently has 128 disclosed shorts in European-listed stocks, compared with 54 a year ago, while Two Sigma Investments’ disclosed shorts have risen from three to 85 over the same period, according to Breakout Point. The rise in short positions does not necessarily imply a negative view of the European market as a whole, as some funds balance their bearish bets with long positions in other stocks.

Brent crude has surged 50 per cent to around $110 a barrel since the start of the war, while TTF, the European natural gas benchmark, is up more than 50 per cent, prompting fears of an energy shock that could fuel inflation and damage economic growth. As a net energy importer, Europe is viewed as much more vulnerable than the US, a net exporter.

The continent-wide Stoxx Europe 600 index has fallen more than 5 per cent since the start of the war, erasing most of its gains for the year.

London-listed Wizz Air became Europe’s most shorted stock last month, after warning that the war in Iran would wipe out its profits this year due to the impact of plane disruption and higher fuel prices.

Short interest in the budget airline has nearly doubled since the start of the war to 15 per cent, while its shares have tumbled by more than a quarter over the same period. Rival airline easyJet has also become a short target.

Some funds see companies exposed to the health of the UK economy as vulnerable.

Citadel is among the hedge funds that have increased bets against British brickmaker Ibstock — a longstanding short target due to the UK’s low rate of housebuilding — in recent weeks, while DE Shaw has disclosed a short position in the company, taking total short interest to more than 12 per cent. The Iran war has intensified the sector’s woes, given its exposure to interest rate volatility.

“The UK seems to be a pretty easy target for short sellers,” said Emmanuel Cau, head of European equity strategy at Barclays. It is “always an area of scepticism and negativity for investors”, he said, adding that the war’s impact on energy prices and interest rates had “revived concerns about the UK consumer and cost of living crisis”.

AI disruption fears have also hit some European equities, as short sellers target those viewed as likely losers from the technology.

UbiSoft Entertainment, the video game maker behind Assassin’s Creed, became one of the region’s most shorted stocks after it announced a restructuring and cancelled or delayed upcoming games.