>>> Europe : Brokers Upgrades & Downgrades - 6th of March 2020

>>> Up
* Avanza Raised to Hold at ABG; PT 98 kronor
* Interparfums Raised to Neutral at Exane; PT 35 euros
* Lundbergforetagen Raised to Hold at Handelsbanken
* Plastic Omnium Raised to Buy at Deutsche Bank; PT 25 euros
* Vonovia Raised to Hold at Bankhaus Metzler; PT 52 euros

>>> Down
* Amundi Cut to Reduce at AlphaValue
* Cineworld Cut to Neutral at Citi
* Continental AG Cut to Sell at Bankhaus Metzler; PT 75 euros
* Hammerson Cut to Neutral at Goldman; PT 218 pence
* Jupiter Cut to Sell at Berenberg
* Norwegian Air Cut to Hold at Pareto Securities; PT 15 kroner
* Norwegian Air Cut to Hold at SEB Equities; PT 16 kroner
* Victrex Cut to Underweight at Barclays; PT 1,870 pence

>>> Initiation
* Euskaltel Reinstated Equal-Weight at Morgan Stanley
* Ice Group Rated New Underweight at Barclays; PT 12 kroner
* Siemens Gamesa Rated New Neutral at Exane; PT 15 euros
* Uniphar Rated New Buy at Berenberg; PT 1.80 euros
* Vestas Reinstated Underperform at Exane; PT 590 kroner

>>> Call
* Berenberg Sees ‘Dislocations’ in Household, Personal Care Stocks
* U.S. Cinema Attendance Could Deteriorate Quickly, Citi Says
* Jupiter Cut to Sell With Challenges on Many Fronts: Berenberg
* Lundbergs Upgraded After Handelsbanken Reviews Portfolio
* Plus500 Offers Hedge Against Market Declines, Berenberg Says

>>> What to look at today - 6th of March 2020

The powerful rally in sovereign bonds gathered pace on Friday, sending benchmarks to historic lows and stirring unease in equities in volatile trading.
Thirty-year Treasury yields slid below 1.5% for the first time, Chinese 10-year yields hit levels unseen since 2002 and Australian ones saw all-time lows. An initial gain in futures on the S&P 500 Index was wiped out, signaling further losses after a 3.4% tumble Thursday. Japanese stocks fell more than 3% and Korean, Hong Kong and Australian shares over 2%. The yuan dropped, though Chinese equities continued to outperform peers. The yen extended gains to a fresh six-month high.
US After Hours OOMA +9.1%, ASPS +7.7% up on earnings, but AOBC -26.2%, HRB -6.2% are weak

Nikkei -2.72% Hnag Seng -2.31% CSI -1.29% Shanghai -0.86% Shenzen -0.25%

Eur$ 1.1227 CNH 6.9533 CNY 6.9511 JPY 105.858 GBP 1.2953 CHF 0.9449 RUB 67.72 TRY 6.1067 WTI$ 45.54 -0.87%

S&P -1.18% Nasdaq -1.16% Eurostoxx -2.50% FTSE -2.01% Dax -2.43% SMI -0.87%

Macro :
- Citi Shoots Down Wall Street’s V-Shaped Recovery Theory
- Sequoia Capital Warns Startups of Coronavirus ‘Black Swan’ Event
- IMF Says Budget Issues Shouldn’t Stop Countries’ Virus Spending

Keep an eye on :
- ACCEL NA : Accell Full Year Net Income EU2.8 Mln, -86% Y/y
- AIR FP : Airbus Logs No Orders, No Cancellations in February
- AZA IM : Italy Sets New Deadline to Express Interest in Alitalia
- BAYN GY : Bayer’s March Trial Over Roundup is Postponed as Talks Continue
- CARLB DC : Carlsberg Probing India Operations for Fraud: ET
- CGG FP : CGG Fourth Quarter Segment Ebitdas Meets Estimates
- COFB BB : Cofinimmo Buys Troon 100 Office in Brussels for About EU40m
- DANSKE DC : Danske Splits Up Trading Floor to Protect Staff From Coronavirus
- EL FP : EssilorLuxottica 1H Rev. Growth to Lag FY Goal on Coronavirus(1)
- EL FP : EssilorLuxottica Sees 2020 Rev. Change Ex-FX +3% To +5%
- EURN BB : Euronav Buys Fourth VLCC Under Construction for $93m
- GS US : Goldman Sachs Unit in Talks to Buy Stake in Permira: DJ
- HSBA LN : HSBC Confirms Employee in China Has Coronavirus, Reuters Says
- IBERCAJA BANCO IPO : Ibercaja Aims to Hold IPO Before Summer: Expansion
- IFX GY : Cypress Semiconductor Sinks on Report of Infineon Deal Scrutiny
- INW IM : Inwit Full Year Revenue 1.5% Above Estimates
- DEC FP : JCDecaux Proposes Switch to European ‘SE’ Company
- KER FP : Prada -3.42% -21.12% YTD - KERING -14.3% YTD
- LAND SW : Landis+Gyr Names Werner Lieberherr as CEO
- MC FP : Prada -3.42% -21.12% YTD - LVMH -9.57% YTD
- MLM IM : MolMed to Develop Viral Vectors for Autolus CAR-T Programs
- PSM GY : NuCom’s Meet Group Deal Seen as ‘Positive Outcome’ at Canaccord
- PST IM : Poste Italiane 2020 Revenue Forecast 1.6% Above Estimates
- PRY IM : Prysmian Full Year Revenue Meets Estimates
- RHK GY : Asklepios Crosses 50% Mark in Rhoen-Klinikum Voting Rights
- SEBA SS : SEB’s Large Clients See Limited Coronavirus Impact, DI Reports
- SCHO DC : Schouw 2020 Ebit Forecast Misses Estimates
- SFSN SW : SFS Full Year Ebit 1.8% Above Estimates
- TEF SM : Telefonica Said to Weigh Splitting Undersea Cables from Telxius
- TIT IM : Italy Fines Telecom Italia For Abusing Fiber Market Dominance
- VIV FP : Universal Music Group Asks Employees Not to Attend SXSW: Variety
- VOD LN : Vodafone Said to Win Conditional EU Approval for Italy Tower Bid
- ZUGN SW : Zug Estates Full Year Adjusted Net CHF31.4 Mln, +9.7% Y/y

(ZH) President Trump Refuses To Answer Questions About Testing Kit Shortage As U

President Trump Refuses To Answer Questions About Testing Kit Shortage As US Case Total Passes 200: Live Updates


Summary:
  • 207 cases reported across the US
  • Santa Clara County total hits 20 as 6 new cases confirmed
  • San Francisco mayor reports first 2 cases in the city
  • SF closes a school after a student tests positive
  • First French lawmaker contracts the virus
  • New Jersey Lt. Gov confirms 2nd "presumptive" case
  • 2 more cases confirmed in Texas's Harris County
  • NYC asks travelers from 5 countries to 'self-quarantine'
  • Trump refuses to answer questions about testing kit shortage
  • NY state cases double to 22
  • Washington state reports another 20 cases
  • Palestinian territories confirm 7 cases
  • Seattle closes 26 schools
  • Pentagon tracking 12 possible COVID-19 cases
  • 35 passengers aboard 'Grand Princess' showing flu-like symptoms
  • Another senior Iranian figure dies
  • Illinois reports 5 more cases
  • NYC reports 2 more cases, raising total to 4
  • Italy postpones referendum vote; death toll hits 148
  • WHO's Tedros: "Now's the time to pull out the stops"
  • Tennessee confirms case
  • Nevada confirms first case
  • New Delhi closes primary schools
  • EU officials weigh pushing retired health-care workers back into service to combat virus
  • Italy to ask EU for permission to raise budget deficit as lawmakers approve €7.5 billion euros
  • Beijing tells residents not to share food
  • 30-year-old Chinese man dies in Wuhan 5 days after hospital discharge
  • Cali authorities tell 'Grand Princess' cruise ship not to return to port until everyone is tested
  • Global case total passes 95k
  • Lebanon sees cases double to 31
  • France deaths climb to 7, cases up 138 to 423
  • EY sends 1,500 Madrid employees home after staffer catches virus
  • Trump says he has a "hunch" true virus mortality rate is closer to 1%
  • Switzerland reports 1st death
  • South Africa confirms 1st case
  • UK chief medical officer confirms 'human-to-human' infections are happening in UK
  • UK case total hits 115
  • Google, Apple, Netflix cancel events
  • HSBC sends research department and part of London trading floor home
  • Facebook contract infected in Seattle
  • Microsoft, Google, Amazon, Netflix cancel events and/or ask employees to work from home
  • Netherlands cases double to 82
  • Spain cases climb 40, 1 new death
  • Belgium reports 27 new cases bringing total to 50
  • Germany adds 87 cases bringing total to 349
* * *
Update (1930ET): We neglected to mention this earlier, but in light of all the companies in the US sending employees home or asking them to WFH (an acronym that's starting cropping up with startling regularity), it's worth mentioning that Starbucks said earlier that it expects a revenue hit of up to $430 million due to the coronavirus's impact on its China business. At the same time, the company revealed Thursday during its after-hours earnings report that 90% of its 4,300 stores have reopened and have returned to business as usual, more or less.


Meanwhile, in what seems like a deliberate decision to slow the increase of the case count, the CDC reported earlier that the "confirmed" cases in the US had topped 149 - 100 cases across 19 states, plus another 49 who had been repatriated from either the Diamond Princess or Wuhan.
That's up from 129 on Wednesday.
Of course, given all the "presumptive" positives reported on Thursday, we suspect that number has already likely increased by at least 50. BNO News, which has been tracking cases across the world, put the US case total at 207 as of 7:30 pm ET.
In the latest sign of the media's frustration with President Trump's handling of the outbreak, ABC News and others have "fact checked" Trump's claim, made during a Wednesday evening press conference, that the slow rollout of new test cases is "Obama's fault."
In reality, the CDC's initial batch of test kits didn't work as designed, as the agency admitted, which left the administration flat-footed when the case numbers started climbing.
The truth is that neither the Obama administration nor the Trump administration really prioritized pandemic response. That, combined with the CDC's epic screwup, is the root of the current problem.
Still, the fact remains that more than 99% of people calling about getting tested are probably hypocondriacs or are unnecessarily paranoid given the news coverage and general hysteria that sent the Dow on another nearly four-figure drop on Thursday.
* * *
Update (1830ET): Following the disclosure of its first two cases, San Francisco has closed Lowell High School - a school that's located on the border of Parkside on the east side of town - after a student there reportedly tested positive for Covid-19. Earlier, Mayor Breed said there were two cases in the city, and that both were "contained". Some 3,000 students attend the school/
However, it looks like this student - if these reports are accurate - might be SF's third case (or they may have been counted in the roll of another nearby county depending on where they live). Public Health Director Dr. Grant Colfax said the first patient was a man in his 90s with underlying health conditions. The patient's condition was described as serious. The second patient is a woman in her 40s and is in the hospital in fair condition. The patients aren't related, and neither traveled recently, meaning they likely picked up the virus in the city, or nearby. They're being kept at separate hospitals.
"We do not know how they were exposed," Colfax said during the press conference (video below). "This suggests that this is spreading in the community."
Breed asked that city residents now treat anybody poorly because of the outbreak, citing harmful examples of "xenophobia" (somehow, we suspect this might not be an issue in SF, unless things get really bad).
Here's a list of closures across the area, courtesy of KTVU.
Elsewhere in the US, Florida's Santa Rosa County has reported its first case of the virus, according to the Florida Department of Health.
As the number of cases soars in France (more than 400 cases reported), the French press reported that a lawmaker named Jean-Luc Reitzer has tested positive and is seriously ill, making him the first French lawmaker to be infected with the virus. Earlier, we reported that 23 Iranian parliamentarians had contracted the virus.
Meanwhile, a NorCal nurse who contracted the virus at work has some pretty harsh words for the CDC and the Trump Administration and the shortage of tests, as President Trump's flippant treatment of the issue seems to have inflamed public sentiment.
This week has been characterized by the explosion in cases and deaths outside China. As a reminder, here's what the trajectory of new cases is looking like ex-China.
* * *
Update (1720ET): Santa Clara County has confirmed another six cases, bringing the countywide total to 20. Seven of those cases are of "unknown origin," and it appears county health officials have no more insights on how those patients were infected.
Steve Lookner

✔@lookner

6 new cases in Santa Clara County, CA

20 total

7 of the cases are of unknown origin

(from press conference)

120 people are talking about this


Steve Lookner

✔@lookner

Santa Clara County: "The risk of exposure to the virus is increasing" in the county

(from press conference)

82 people are talking about this


The county is recommending that organizers postpone any large gatherings...
* * *
Update (1645ET): Two more cases have been confirmed by the CDC in Texas's Harris County, as a man and woman from the unincorporated area immediately northwest of the county have been confirmed to carry the virus, according to WFAA.
Two people in northwest Harris County have tested positive for the coronavirus, according to Harris County Public Health.
The tests have been verified by the Centers for Disease Control and Prevention.
These cases are travel-related and, at this time, there is no evidence of community spread. The man and woman live in the unincorporated area of northwest Harris County, outside the City of Houston.
Fort Bend County also reported a presumptive positive case on Wednesday.
“Since January, we have been at an elevated level of readiness to prepare for and respond to a positive case here in Harris County,” said Harris County Public Health Executive Director, Dr. Umair A Shah, MD, MPH. “We will continue to take action by identifying potential contacts and monitoring them closely."
HCPH officials said they understand residents will be concerned about local cases, but said 80-percent of people who have coronavirus experience mild to moderate symptoms and fully recover.
Meanwhile, in NYC, Mayor de Blasio said city officials would ask visitors from five countries to "self-quarantine" if they happen to be in NYC. Sounds like a great way to spend a vacation abroad.
Finally, President Trump caught some flak from reporters over VP Pence's admission that the administration doesn't have enough tests on hand to meet demand.
Paula Reid

✔@PaulaReidCBS

JUST IN: @realDonaldTrump does not answer questions on why coronavirus test kits were not sent out sooner as @VP says there are not enough tests today to meet “anticipated demand.” @CBSNews


831 people are talking about this




* * *
Update (1530ET): The government of the Palestinian territories confirmed Thursday that 7 cases of the coronavirus had been identified. In response, the government has banned all tourists for two weeks. The cases were all discovered in the Bethlehem area, a town south of Jerusalem that was, according to the New Testament, the town where Jesus was born.
As the death toll in Italy, the epicenter of the outbreak in Europe and the broader Mediterranean area, climbs to 148 and the outbreaks in both Germany and France worsen, Paris officials have cancelled the Paris Marathon, postponing it until October.
Oh, and here are some tweets from Dr. Tedros reiterating what he said earlier during Thursday's WHO presser.
Tedros Adhanom Ghebreyesus

✔@DrTedros
Leadership from the top: We call on country leaders to mobilize their plans, coordinating every part of government, not just the health ministry – security, diplomacy, finance, commerce, transport, trade, information and more – the whole government should be involved. #COVID19
Tedros Adhanom Ghebreyesus

✔@DrTedros

We're concerned that in some countries the level of political commitment & the actions that demonstrate that commitment don't match the level of the threat we all face. This is
NOT a drill
NOT the time to give up
NOT a time for excuses
This is a time for pulling out all the stops

3,394 people are talking about this


* * *
Update (1510ET): During a live update of the coronavirus situation in New Jersey, Lieutenant Gov. Sheila Oliver reportedly said that the state had identified a second "prospective" case.
This brings the total cases in the county to 51, with one additional death.
* * *
Update (1450ET): VP Mike Pence said Thursday that the Coast Guard had delivered coronavirus tests to the 'Grand Princess' cruise ship off the coast of San Francisco. Pence also admitted during an update from the White House task force that the CDC doesn't have enough tests to meet anticipated demand going forward, while HHS Secretary Azar said earlier that 75,000 test kits would be shipped by the end of the week.
This is really not helping the administration deflect criticisms that it failed to adequately prepare for the virus.
Meanwhile, Washington's King County, part of suburban Seattle, has just reported another 20 cases of Covid-19, increasing the state of Washington's total by roughly 20%.
Iranian diplomat Hossein Sheikholeslam, a former member of parliament and Iran's former ambassador to Syria and current advisor to the foreign minister has died of coronavirus, becoming the latest senior government figure to die from the virus.
Though dozens of cases have already been reported across California, San Francisco hotels had already reported 150k cancellations tied to the outbreak - and that was before discovering evidence of a potential community outbreak.
Christopher Mims

✔@mims

150,000 hotel nights lost in SF alone due to coronavirus.

One city. https://twitter.com/SFBusinessTimes/status/1235656515723448321 …
San Francisco Business Times@SFBusinessTimes

It's only been a week since cancellations started, but the losses are already mounting. The questions are: Will they continue? And when will they end? https://www.bizjournals.com/sanfrancisco/news/2020/03/04/the-coronavirus-has-already-cost-the-city-150-000.html?ana=TRUEANTHEMTWT_FR&taid=5e615a6d05296a0001044f2a&utm_campaign=trueAnthem%3A+Trending+Content&utm_medium=trueAnthem&utm_source=twitter …

31 people are talking about this


* * *
Update (1450ET): This is extremely savage, even for Iran.
The Saudi government denounced Iran on Thursday for allowing several Saudi citizens to enter the country without stamping their passports, a move that was likely deliberately intended to spread the virus to Saudi Arabia, Iran's chief political and military rival in the region.
  • SAUDI ARABIA DENOUNCES IRAN FOR GRANTING SAUDI CITIZENS ENTRY WITHOUT STAMPING THEIR PASSPORTS AMID CORONAVIRUS OUTBREAK -STATEMENT
* * *
Update (1430ET): The $8.3 billion emergency coronavirus funding package has passed the Senate, following a tweet from President Trump last night urging lawmakers to pass it, claiming he would sign it once it hit his desk. Presumably, that's still the plan.
According to CNN, the agreement provides $7.8 billion in appropriations to address the outbreak of coronavirus as well as an authorization for $500 million in mandatory spending to finance a telehealth program intended to expand access to diagnostic services.
In other news: Mayor Breed has confirmed that the two cases in San Francisco are examples of community transmission, and are unrelated, suggesting that a larger outbreak is already underway in the city. The first patient is a man in his 90s who is in serious condition with underlying health conditions. The second person is a woman in her 40s who is in fair condition.
Gav. Newsom and the CDC, meanwhile, said they're still working to find "the best location" for the "Grand Princess" to dock as 35 passengers are reportedly exhibiting flu-like symptoms, though at least two said earlier that they were tested and cleared.
Oddly, in other news, Energy Secretary Dan Brouillette said Thursday that SARS drugs could be used to treat the coronavirus, before adding that the outbreak will have only a 'marginal' impact on oil demand.
Mr. Secretary, this is not the time to be talking your book.
* * *
Update (1415ET): San Francisco is already described by many as a dystopian nightmare city, a living testament to a future where wealth inequality has reached such exaggerated extremes that a clear caste system has emerged, dominated by an elite group of tech billionaires and multimillionaires.
And now, it also has the coronavirus.
  • SAN FRANCISCO HAS 2 CASES OF CORONAVIRUS, MAYOR SAYS
Mayor London Breed is holding a press conference on the situation. Watch live below:
London Breed

✔@LondonBreed

Update from San Francisco leaders on local response and preparedness efforts regarding novel coronavirus (COVID-19) https://www.pscp.tv/w/cS_ykjF6dkVOcGtSbkdaS2V8MWRSSlpRRHFtUlZHQjicKhROhmt24xvtxMjOCk5CyG7ay81yl2JMu1IH5TR_ …
London Breed @LondonBreed
Update from San Francisco leaders on local response and preparedness efforts regarding novel coronavirus (COVID-19) — San Francisco, CA, United States
pscp.tv

69 people are talking about this


* * *
Update (1355ET): Now that Cuomo's latest update is over, we have some more information about the 9 new cases confirmed in New York State.
Eight of the new cases are in Westchester, connected to Lawrence Garbuz, the New Rochelle-based lawyer, while the ninth is on Long Island, Cuomo said. Garbuz's wife, son and daughter have all tested positive, as has a friend of Garbuz's, his wife and three of their four kids.
A neighbor who drove Garbuz to the hospital has also been infected. Because he's suffering from an underlying respiratory issue, Garbuz is being treated at a hospital in Upper Manhattan, while the rest of the patients are self-isolating. The patient on Long Island has also been hospitalized, though few details were given about that case.
Two students at Yeshiva University’s Washington Heights campus are being "evaluated" after possibly being exposed via Garbuz's son, along with seven of Garbuz's co-workers and an intern.
"Here the facts do not merit the level of anxiety that we are seeing...I believe it’s being generated because...people don’t know the truth, they don’t know the facts. I’m a little bit perturbed about the daily angst," Cuomo said.
Earlier, NYC Mayor Bill de Blasio confirmed two new cases in the five boroughs: A man in his 40s, and a woman in her 80s, who are both in intensive care.
* * *
Update (1330ET): The Southeastern Nevada Health District has confirmed that Nevada has indeed recorded its first case of the coronavirus, according to the Las Vegas Sun.
Judging by the description, the patient, who is a Clark County resident (most of the county, but not all, is in the city of Las Vegas), is a high-risk patient: He's in his mid-50s and has an underlying health condition. He also recently traveled to Washington State and Texas. Texas recently reported its first travel-associated case in Houston, and community spread is already believed to be happening in Washington State.
Here's more from the Sun:
The Health District was working with its health care partners and leading the effort to quickly identify close contacts of the patient, officials said. Those exposed to the patient were being asked to self-quarantine, officials said.
Test results are considered "presumptive positive" until confirmed by the federal Centers for Disease Control and Prevention, officials said. It should take 24 to 48 hours for the CDC to confirm the results, officials said.
The patient was identified through the VA Southern Nevada Healthcare System, said Shelbie Bostedt, a spokeswoman for U.S. Rep. Steven Horsford.
Horsford said in a statement that he was working the Gov. Steve Sisolak's office, the VA and the Health District to stay apprised of the situation. "I take the safety of all Nevadans seriously," he said.
The Health District said the immediate risk from the virus to the general public in Clark County is low at this time. No community spread has ben identified at this time, officials said.
In other news, France has confirmed its 423rd case, up 138 from late Wednesday, according to local health officials. In total, seven have died.
* * *
Update (1300ET): Bernie Sanders has cancelled an upcoming Mississippi rally. Interestingly enough, the coronavirus is only one reason. The Sanders campaign has apparently realized that any more effort campaigning in Mississppi would be wasted - Democrats in the state are mostly black and will back Biden by a massive margin.
Instead, he's going "all in" on the Midwest as his best shot at the nomination.
* * *
Update (1250ET): During yet another press conference (the fourth in roughly 36 hours), NY Governor Andrew Cuomo just announced that the number of confirmed coronavirus cases in his state has nearly doubled to 22.
ABC News

✔@ABC

BREAKING: Gov. Andrew Cuomo announces that there are 11 new cases of novel coronavirus reported in Westchester County, New York City and Long Island. https://abcn.ws/39vIaNW 


110 people are talking about this


* * *
Update (1230ET): Illinois has confirmed 5 more cases of Covid-19, bringing the US case total to 159.
Over in the UK, the Telegraph reports that a patient has died from the virus, marking the first death in the UK as the number of confirmed cases nears 100.
In other news, the Ultra Music Festival in Miami has been postponed until next year.
As we noted earlier, Cali Gov. Gavin Newsom has ordered the 'Grand Princess' cruise ship to remain offshore until all its passengers can be tested for the virus. We were one of the first media organizations to link the death of a 71-year-old man in California to the investigation into a previous voyage of the cruise ship and its connection to one of the patients.
Now, Fox 2 KTVU is reporting that several passengers aboard the ship are displaying flu-like symptoms.
In fact, two women have posted a YouTube video from their cabin, saying they are experiencing typical cold symptoms, but that they do not have a fever. They said in the video that they were tested for the virus, but told they didn't have it.



In other news, Hawaii has become the fourth state to declare a state of emergency over the virus, even though no cases have been confirmed in Hawaii yet, despite several scares. But Hawaii Gov. David Ige said the declaration would allow the state to better prepare.
Regarding the latest case confirmed in California, that of an LAX airport screener, officials reportedly can't tell if he contracted the virus at work, or "in the community" - which is extremely discouraging, if you ask us.
Cali has reported 53 cases so far.
The Grand Princess currently has 2,500 passengers. The number of crew is unclear.
In a statement, Princess Cruises said there are no confirmed cases and that only 100 individuals have been "identified for testing."
"There are fewer than 100 guests and crew identified for testing, including all in-transit guests… those guests and crew who have experienced influenza-like illness symptoms on this voyage, and guests currently under care for respiratory illness," the statement said.
So Newsom is going to let thousands de-board after testing a smattering of 100 people out of more than 3,000. Sounds like a great 'containment' plan.
We're also starting to wonder how Carnival Cruise, which owns Princess cruises, is going to deal with this latest crisis.
* * *
Update (1220ET): As more workers are being told to work from home and more schools, events and businesses close around the world, Seattle has just closed 26 schools - the entire school district - for two weeks.
* * *
Update (1215ET): Italy's national death toll has just taken another leap higher: Officials are now reported a new total of 148 deaths, following the disclosure of 25 deaths in Lombardy about an hour ago. Another couple of dozen deaths have apparently been recorded since.

Italy might want to consider taking a page out of Iran's playbook and lying about the numbers.
Speaking of Iran, neighboring Iraq has just reported another three cases, bringing its total confirmed to 38.
Before we go, we wanted to mention one final comment from Dr. Tedros from Thursday's Trump-shading, China-praising, WHO press conference.
After Dr. Tedros chided world leaders for not doing enough, while simultaneously claiming that the world is well-prepared for the virus, the good doctor claimed that while we're not quite at 'pandemic' level yet (a fact that's disputed by many experts, who believe we are indisputably in the midst of a pandemic) there are "very concerning signs".
* * *
Update (1120ET): Italian health officials have reported 25 more deaths on the Lombardy region of northern Italy - the worst-hit region. Deaths in this region alone have climbed to 98, bringing Italy's national total to 132.
* * *
Update (1100ET): The UK has reported that total coronavirus cases have risen to 115 from 85 earlier on Thursday, making the UK the latest European nation to see its total confirmed cases break above 100.
In the corporate sphere, accounting and consulting firm Ernst & Young sent around 1,500 employees from its Madrid offices home on Thursday after a staffer was confirmed to have contracted the virus. Wal-Mart is restricting all cross-border travel to only "business-critical" trips.
As of March 5, the CDC has confirmed 100 cases in its lab, the agency said, meaning some cases reported by the states have yet to be 'officially' confirmed. It has also confirmed another death, bringing the total to 10 (meaning one reported death has yet to be officially confirmed). DHS said US has no plans at this time to lift China travel restrictions.
WHO's Dr. Tedros said Thursday during the NGOs daily presser that now is the time to "pull out all the stops" to combat the virus - which is ironic, considering the agency won't officially label the outbreak a 'pandemic', even though experts in the US have told the Washington Post and other media orgs that it is undoubtedly a pandemic. They also added that there's "no evidence" the virus has been spread from a human to a dog, despite earlier reports.
WHO added that heads of state must "take responsibility" for their virus response (obviously a snipe at President Trump, whom critics have accused of 'denying' the existence of the virus'.
Tedros also threatened to "name names" of governments that aren't doing enough to prepare for the outbreak during his next press conference.
The organization also has found no evidence the virus will behave differently in different climates, even as its spread across Africa has been notably slow.
EU officials are reportedly considering pressing retired health-care workers back into service as a 'response' to the virus. Hopefully, the elderly nurses and doctors aren't left to catch the virus and die.
* * *
Update (1035ET): Another Italy update...
  • ITALY TO ASK EU FOR GO AHEAD TO RAISE BUDGET DEFICIT BY 0.35 PERCENTAGE POINTS OF GDP TO TACKLE CORONAVIRUS GOVT SOURCE
Unsurprising given that lawmakers approved more than the recommended €5 billion.
* * *
Update (1025ET): Xinhua reports 16 new cases have been confirmed in Lebanon, more than doubling the case total to 31.
  • Xinhua: Lebanon's COVID-19 cases rise to 16
In other news, Italy has dedicated more money to its coronavirus response than it initially expected. .
  • ITALY TO ALLOCATE EU7.5B FOR VIRUS RESPONSE STIMULUS: ANSA
* * *
Update (1015ET): As we move closer to half of states having confirmed cases of their own, the Nevada Independent reported that Nevada officials had identified the first case of the virus in the state just minutes after Tennessee Gov. Bill Lee confirmed the first case in his state.
  • NEVADA SEES FIRST CASE OF CORONAVIRUS IN PATIENT: NEV. IND.
17 states now have confirmed cases of Covid-19.
* * *
Update (1010ET): Tennessee has confirmed is first case, according to media reports.
  • FIRST CONFIRMED CASE OF CORONAVIRUS IN TENNESSEE: WKRN-ABC
The reports were almost immediately confirmed by the governor.
Arianna Poindexter

✔@AriannaWMC5

#Breaking Gov. Bill Lee announces first confirmed case of #Coronavirus in Tennessee

See Arianna Poindexter's other Tweets


* * *
Update (1000ET): The Pentagon is reportedly tracking 12 individuals who may be infected with the coronavirus.
  • PENTAGON IS TRACKING 12 POSSIBLE COVID-19 CASES, OFFICIAL SAYS
* * *
Update (0930ET): France health officials have reported another 2 deaths, bringing the death toll in Europe's second-largest economy to at least six.
We also have some more details on the first case in South Africa, which we noted earlier on Thursday shortly after the news broke: SA's News 24 has some more information on the case: It's a 38-year-old man who had recently traveled to Italy.
Italy and Iran remain two of the most commonly-cited spreaders, as travelers around the world are bringing the virus home after trips to northern Italy.
The man and his wife were among a group of 10 who returned from Italy on March 1.
Yet the government insists it doesn't expect more cases as South Africa's summer season is typically inhospital to viral outbreaks. Given the surprising lack of spread in Africa so far - which some fear might be a result of low testing rates - they might have a point.
* * *
Update (0920ET): Two Italian Red Crossvolunteers have tested positive while another 140 have been deemed "at risk" for infection. Trump "Iran whisperer" Brian Hook said Thursday that Iran had rejected the State Department's offer of assistance.
Meanwhile, NYC Mayor Bill de Blasio has shared some more details about the two new cases confirmed in New York, including confirming that investigators haven't been able to trace the source of the infection, suggesting that an uncontained outbreak is already underway in NYC.
Mayor Bill de Blasio

✔@NYCMayor

There are two new confirmed cases of COVID-19 in New York City. One new patient is a man in his 40s, and one new patient is a woman in her 80s.

Neither patient has a connection to travel nor any of the other local individuals diagnosed with COVID-19.

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Since they haven't traveled, the patients were almost certainly infected in the US, and possibly in NYC.
* * *
Update (0850ET): Yesterday, we pointed out that the first fatality reported in California appeared to be the same patient - a 71-year-old man - whom state officials had said recently traveled aboard a cruise ship called the "Grand Princess". The ship, which was ironically on its way to dock in San Francisco at the time, was ordered to remain offshore. According to USA Today, officials confirmed on Wednesday that the ship will not return to port until testing of everyone on board can be carried out.
And just like that, the US has its own cruise ship emergency, though it appears authorities are learning from the mistakes made by Japanese health officials during the 'Diamond Princess' fiasco (to be sure, the US clearly violated quarantine by transporting sick passengers back to the US).
Gov. Newsom said the state would scramble to test the passengers as quickly as possible.
"We will be able to test very quickly... to determine if these individuals that are symptomatic just have traditional colds or the flu or may have contracted the COVID-19 virus," Newsom said.
We'll keep an eye on that - we suspect we might have more cases to report soon.
Over the last hour or so, some more virus-linked headlines have hit the tape.
  • South Africa has reported its first case of the virus.
  • New Delhi has shut down primary schools as virus spreads in India.
  • Confirmed cases of the virus have doubled in the Netherlands to 82
  • US official 'concerned' about health of Iranian detainees.
We'll be back with more updates shortly.
* * *
Update (0840ET): Italy has postponed a referendum to reduce the number of lawmakers, a hot-button local issue that is at the crux of a government reform agenda pushed by the Five Star Movement.
  • ITALY GOVT TO POSTPONE MARCH 29 REFERENDUM ON CUT IN NUMBER OF PARLIAMENTARIANS DUE TO CORONAVIRUS - SOURCES
* * *
Update (0822ET): As China continues to roll out new restrictions on foreign travelers, all while gloating about the world's inability to contain the outbreak that China unleashed, Global Times editor Hu Xijin tweeted Thursday morning that he was "calling on" the Chinese government to impose 14-day quarantines for everybody traveling from the US.
Hu Xijin 胡锡进

✔@HuXijin_GT

US CDC’s passive attitude in tallying/disclosing infection number, and Trump administration’s attempt to downplay the epidemic is disturbing. I have called on Chinese local governments to implement 14-day quarantine for all people coming from the US.

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China managed to stop the virus only by restricting the movements of roughly half its population. Democracies like the US unfortunately don't have that power.
* * *
Update (0720ET): NYC Mayor Bill de Blasio has apparently just announced during an appearance on "Morning Joe" that NYC has confirmed 2 more cases, raising the citywide total to 4 and the state-wide total to 13, per the NYT.
Julia Marsh@juliakmarsh

BREAKING: @NYCMayor announces two new #coronavirus cases in NYC on Morning Joe just now. Source says it's a man in his 40s and a woman in her 80s. That brings the city's total positive tests up to four.

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The new cases include a man in his 40s and a woman in her 80s.
* * *
With stock futures once again pointing to a massive drop at the open, the brief respite provided by Joe Biden's political comeback has faded as Americans brace for the outbreak by, among other things, hoarding Purell, while California and others threaten to prosecute sellers caught gouging prices on essentials as people across the country stock up.
More US companies have cancelled events: Last night, Google said it would cancel its developer conference and Netflix has cancelled SXSW screenings. In London, HSBC has evacuated its entire research department and parts of its Canary Wharf trading floor, Financial News reports. A Facebook contractor has been infected in the company's Seattle office. Microsoft, Amazon and Facebook have all asked their Seattle employees to work from home.
Since midday on Wednesday, the virus death toll in the US has held steady at 11. But there's no denying the reality that coronavirus hysteria has arrived in America. Last night, California declared a state of emergency, joining Florida and Washington State.
And with cases confirmed in New York, Rhode Island and New Jersey, the virus has officially gone bi-coastal.
Globally, the number of confirmed cases has surpassed 95,000, and the global death toll is north of 3,000. China remains by far the worst hit, with 80,410 cases, while South Korea is No. 2 with 5,766. They're followed by Italy and Iran.
Courtesy of the FT
In addition to declaring the state of emergency, Cali Gov. Gavin Newsom ordered that a cruise ship - the 'Grand Princess' - preparing to dock in San Francisco be held off the coast of California after the one fatality in California was linked to a previous voyage on the ship.
Late yesterday, New Jersey Gov. Phil Murphy announced that local health officials had discovered the first "presumptive" case of the virus in Bergen County, a suburb of New York City. The individual, a male in his 30s, has been hospitalized in the county since March 3. The "presumptive" case was initially tested at a local New Jersey lab
Governor Phil Murphy

✔@GovMurphy

Tonight, Acting Governor @LtGovOliver and I are announcing the first presumptive positive case of novel coronavirus, or #COVID19, in New Jersey. The individual, a male in his 30s, is hospitalized in Bergen County and has been hospitalized since March 3rd.

2,373 people are talking about this


Governor Phil Murphy

✔@GovMurphy

We take this situation very seriously and have been preparing for this for weeks. I urge residents to remain calm.

The investigation is underway & more information will be released when it becomes available.

For more info:
visit http://nj.gov/health 
call 1-800-222-1222

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According to the CDC, 14 US states have reported either confirmed or "presumptive" cases of the virus.
Already, the number of confirmed cases in the US is north of 150 (including the 48 evacuees).
Yesterday, VP Pence and HHS Secretary Azar promised that new screening measures would be applied to travelers from South Korea and Italy. Australia on Thursday joined the list of countries restricting travel by barring visitors from South Korea. Meanwhile, in a glimpse of what's to come for the airline industry, which could be in for a $100 billion hit tied to the coronavirus, the UK regional airline Flybe collapsed.
As the outbreak appears to wane in China, President Xi has cancelled a state visit to Japan because of the rapidly circulating outbreak.
Though it wasn't all good news out of Beijing: Last night, the western press reported that a 36-year old man thought to have recovered from coronavirus had died from respiratory failure in Wuhan five days after being discharged. It's alarming because the man was young and otherwise healthy - characteristics that should have made him particularly resilient to the virus.
Also, Beijing has imposed a new rule on residents: Eat alone, keep away from co-workers, and under no circumstances should you share plates with others (popular in so called 'hot pot' dishes and other communal-type meals).
Much to the chagrin of his political allies, President Trump continued his campaign to minimize the severity of the outbreak during an appearance on Hannity Wednesday night when he said he had a "hunch" the real mortality rate for the virus is closer to 1% than the 3.4% estimate shared by Dr. Tedros during Wednesday's WHO Press conference.
Aaron Rupar

✔@atrupar

Trump to Hannity on WHO saying coronavirus death rate is 3.4%: "I think the 3.4% number is really a false number. Now this is just my hunch, but based on a lot of conversations ... personally, I'd say the number is way under 1%."

Astoundingly irresponsible.


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In South Korea, mass testing has confirmed more than 6,000 cases as of the health officials' second update on Thursday, as well as more than 40 deaths. Italy has confirmed more than 3,000 cases, along with more than 100 deaths. Elsewhere in Asia, Malaysia has confirmed another 5 cases, bringing its national total to 55. Travelers who have recently visited any hot spots - northern Italy, Hokkaido (in Japan), Tehran and Daegu - will be temporarily banned from entering Malaysia, unless they are Malaysian citizens.
Officially, Iran has confirmed 92 deaths and 2,922 cases. But the Washington Post reported last night that data obtained from a string of hospitals in Tehran suggests that the epidemic has spread far more widely than the government has acknowledged.
CNN reports that the case total in India, the world's second most populous country, has climbed to 29 (three have already recovered). In response, India has started screening all passengers who arrive at its airports for the virus. The Indian government is also preparing to evacuate its citizens from Iran, becoming the first country to plan an evacuation from the epicenter of the virus in the Middle East.
Based on the data, which was given to WaPo by a UK-based activist, the true case count in Iran is probably closer to 30,000 than the 3,000 cases counted by the government. And the death toll is likely closer to 1,000 than 100 - after all, the BBC reported last week that the true death toll was already north of 200 days ago.
Whatever the real number, as more senior government officials catch the virus, the Islamic Republic has kicked off its "national mobilization" scheme in which 300,000 medical teams joined by voluntary members of the IRGC - the Revolutionary Guard - will monitor families across the country and take unexplained action to help limit the spread. The teams will be stationed in "medical facilities, schools and military bases" across Iran. The Iranian government has also started to limit travel within the country after suspending issuing visas for travelers from other hot spots.
With 15 cases confirmed in Israel, the West Bank city of Bethlehem has closed all mosques and churches, setting of a controversy in the town where Jesus was reportedly born, Middle East Eye reports.
Over in Europe, Switzerland reported its first death overnight; health officials have confirmed 80 cases across the small alpine state. In Italy, where the number of cases climbed above 3,000 (total: 3,089) and deaths surpassed 100 (total: 107), Deputy Economy Minister Laura Castelli said the government could increase the size of the package to €5 billion, according to the FT. In the UK, PM Boris Johnson said Thursday morning during an interview with ITV that the best thing Britons can do to prevent the spread of the virus is to "just wash our hands," Johnson said. He also stressed that for most people who catch the virus, this will be a "mild to moderate" illness. The number of confirmed cases in the UK climbed to 88 on Thursday. ITV also reported. Six of those were reported in Scotland, 2 in Wales and three in Northern Ireland.
In London, en employee in HSBC’s research department has reportedly tested positive for the virus, Reuters reported.
The latest increase in cases comes as the NHS warns that it doesn't have enough nurses, ITV reports. Despite efforts to fill positions, more than 43,000 vacancies remain across the UK.
Meanwhile, UK Chief Medical Officer Chris Whitty confirmed that human-to-human transmission is ongoing in the UK, before adding that the UK is now "mainly in the second stage" of its plan to tackle coronavirus, which involves delaying the spread for as long as possible to stop the virus from overwhelming the country's hospital system.
Elsewhere in Europe, Spain confirmed 40 new cases and 1 new death bringing its total to 248 and death toll to 3. Belgium reports 27 new cases raising total to 50.
After all, since western democracies simply can't undertake the same heavy handed response imposed by China (though the west has the advantage of jumping on the problem instead of choosing to ignore it for weeks), the west is going to need to accept the fact that the virus will likely become significantly more widespread.
Before we go, we'd like to leave readers with a little levity. Are you a recent college grad searching for a business plan?
Here's a freebie, courtesy of the CCP:
Global Times

✔@globaltimesnews

Xuzhou City in E #China’s Jiangsu, has put into use the country’s first self-vending machine that dispenses #masks. With a daily limit of 800 masks, this tool has been in use since Mar 2. Residents can buy two N95 masks using their ID cards every 24 hours for 12 yuan ($1.72).


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FT : Flybe/state aid: UK sets good precedent as coronavirus bites

Flybe/state aid: UK sets good precedent as coronavirus bites
It is not the role of taxpayers to underwrite bad business propositions rejected by the markets

Pterosaurs, winged reptiles from about 100m years ago, barely looked airworthy. You could say the same of Flybe, a small UK airline heading for extinction itself. After months of talks with the government over emergency funding, it has collapsed into administration.

Weighed down with a heavy cost structure, Flybe will join the fossilised remains of Monarch Airlines and Thomas Cook. Coronavirus gets the blame for Flybe’s immediate cash shortage. But this was always a subscale company with a weak business plan.

The epidemic will push other weak enterprises to the brink. They too will demand bailouts. The current government should give them short shrift, even as it supports business broadly by extending tax payment deadlines and speeding payment on state contracts.

Flybe, extant since 1979, has a history of lifting off from one financial mess and landing in another. A restructuring in 2013-14 was meant to create a regional airline competing against trains. Unfortunately, having the highest share of seats from Belfast to Manchester would never guarantee Flybe’s survival into the next decade.

By September 2018 Flybe’s tangible equity per share of £0.50 had hardly changed from five years before, according to S&P Global. Its cost per passenger (ex-fuel) of £52.90 per flight pretty much equalled the equivalent revenue per customer.

In contrast, easyJet has costs just over £40 per flight on routes that are longer. Blame Flybe’s fleet of 54 fuel-guzzling planes.

Connect — a consortium of Virgin Atlantic Airways, Stobart Air and hedge fund Cyrus Capital — has injected £135m over the past 14 months to rescue Flybe. This week, the Financial Times reported the government had declined to stump up a £100m loan. That will play badly with employees, who are understandably distressed. It will also trigger complaints Prime Minister Boris Johnson does not really care about the regions.

The same arguments were rehearsed following the credit crunch. Labour prime minister Gordon Brown dead batted calls for state support back then. They came from LDV, a van company that collapsed, and Jaguar Land Rover, which found the money elsewhere.

Mr Johnson is right to flee commitment this time round. It is not the role of taxpayers to underwrite bad business propositions rejected by the markets. The prime minister has set a precedent. It will prove useful when coronavirus prompts other poorly adapted organisms to seek help in staying aloft.

This article was amended after publication to revise the scale of Connect’s cash injection into Flybe.

FT : Credit Suisse linked to list of Nazi émigré accounts in Argentina

Credit Suisse linked to list of Nazi émigré accounts in Argentina
‘Many’ of the 12,000 German fascists named used Swiss bank’s predecessor to funnel looted Jewish money

Nazi hunters at the Simon Wiesenthal centre claim to have identified accounts at Credit Suisse used to funnel looted Jewish money to and from 12,000 German fascists living in Argentina.

Investigators said they had obtained an explosive and long-lost list of undercover Nazi supporters in the Latin American country during the 1940s, with details of their financial affairs.

The list was thought to have been destroyed in 1943, when Argentina’s republican government was overthrown by a military junta sympathetic to Nazi Germany.

“Many” of the 12,000 on the list had or used accounts at the Schweizerische Kreditanstalt, the Wiesenthal Centre said. It did not detail how many did so, or whether the list contained details of the accounts themselves.

The Schweizerische Kreditanstalt is the original name of Credit Suisse. Windows at the bank’s headquarters in Zurich are still emblazoned with its acronym: SKA.

Switzerland’s banks have done extensive work trying to uncover Nazi accounts. Credit Suisse said it was not clear how many of the names on the new list might have been exposed in previous forensic work on its archives.

The bank said: “From about 1997 to 1999, an independent committee chaired by Paul Volcker carried out an investigation of Credit Suisse and about 60 other Swiss banks, searching for accounts possibly or probably owned by victims of Nazi persecution and brought evidence of accounts held by Nazis to the attention of the Independent Committee of Experts [the Bergier Commission].”

The Bergier Commission concluded that the Volcker investigation had “provided as full and complete accounting of the status of the accounts in Switzerland of victims of Nazi persecution as is now reasonably feasible,” the bank added.

A spokesperson for the bank said it had been in contact with the Wiesenthal Centre and it will investigate the new claims fully.

The bank has not yet received a copy of the list, or details of the accounts claimed to be used by those on it.

Switzerland, thanks to its neutral status, was used by Nazis in Argentina to help facilitate their international business affairs after other nations, including Britain and the USA, imposed sanctions on the Hitler regime and its supporters in the 1930s and 1940s.

The Alpine state — whose banking industry was once a byword for secrecy — has had a traumatic reckoning with its relationship to Nazism during the period. After the war, an agreement with the allied powers provided for full investigation of all accounts held by German citizens in the country. However, the Swiss did not accede to demands for all German accounts to be liquidated and paid as reparations. This left hundreds of accounts dormant — including many owned by Jewish families killed by the Nazis, as well as Nazis themselves.

During the 1990s, Bern moved to comprehensively address the issue as international pressure for it to do so — and the threat of international sanctions against Switzerland — made its continuing quiescence on the subject untenable.

“People sometimes forget or don’t realise, but it really was the biggest crisis for Switzerland since the war itself,” said Thomas Borer, a Swiss diplomat who was appointed by Bern in 1996 to head the task force to investigate Nazi financial activities in Switzerland.

Mr Borer’s work led to a 1998 settlement in which UBS and Credit Suisse paid $1.25bn to victims of the Holocaust and their heirs.

The prospect of 12,000 new, uninvestigated names coming to light “seems highly unlikely”, Mr Borer said.

“There is always the possibility that there are more names and more accounts but one should not forget just how much this was investigated. The banks spent SFr500m on accounting firms alone to look into this.”

FT : Global equity fund outflows hit $23bn on coronavirus fears

Global equity fund outflows hit $23bn on coronavirus fears
Europe particularly affected in worst week since July 2016

The stampede from funds that invest in global equities has accelerated, with $23.2bn of withdrawals, as the economic impact of the coronavirus intensified. 

The outflows in the week to Wednesday are the biggest since August 2019, according to EPFR Global data, and greater than the $19.4bn investors pulled from global equity mutual funds and exchange traded funds in the previous week.

“Although cases have been starting to appear in the US, the spread of the coronavirus has been more advanced in Europe, most notably in Italy,” said Martin Fridson, chief investment officer at Lehmann Livian Fridson Advisors.

Italy is to inject €3.6bn into its economy in an attempt to mitigate the impact of the largest outbreak of coronavirus in Europe.

Funds that invest in European equities $2.9bn of outflows, marking their worst week since July 2016.

Funds invested in European bonds also had a rough week. Investors pulled $2.6bn in the latest week, up from $9m of withdrawals the previous week, the worst outflows since November 2019 and the first since December 2019. Funds invested in global high-yield junk debt suffered $7.9bn of outflows in the latest week, up from $6.8bn the prior week, the worst outflow since February 2018. 

In the US, funds that invested in high-yield junk bonds saw a deceleration of selling from investors. Those funds posted $2.9bn of outflows in the latest week, down from $6.7bn in the previous week, according to EPFR data. 

“One factor is that the investment grade and high-yield US corporate index both became steadily more expensive relative to their European counterparts since early 2019,” Mr Fridson said. “So in relative valuation terms, Europe was particularly vulnerable.” 

Investor withdrawals also eased in funds that invest in US equities, with $6.2bn of outflows in the latest week, down from $17.7bn of outflows in the previous week.

Danielle DiMartino Booth, chief executive of Quill Intelligence, a research group, said the Federal Reserve’s emergency rate cut of half a percentage point this week helped cushion the blow in US stocks and corporate credit markets. 

The Fed’s surprise lowering of its fed funds policy rate followed supportive statements from finance ministers and central banks across the globe, as the G7 countries co-ordinated their message to markets. 

“That was enough for a relief bounce in equities and enough to thaw the frozen credit markets,” Ms DiMartino Booth said. “We had not seen new corporate credit deals all last week and now policymakers have resurrected that. But credit will continue to force Fed chair (Jay) Powell’s hand again and again until he run’s out of chips to bet.”

US markets suffered another day of losses on Thursday as yields on US Treasuries hit record lows.

FT : Valued at $30bn, Waymo considers its next move

Valued at $30bn, Waymo considers its next move
Windfall pushing Alphabet division above rivals comes at turning point for group

When outside investors lined up this week to pour $2.25bn into Waymo, Alphabet’s self-driving technology division, it brought strong validation for a decade of work.

The deal valued Waymo at more than $30bn, according to people familiar with the transactions. That valuation, which has not previously been reported, makes Waymo worth considerably more than the $19bn assessment for SoftBank-backed Cruise, the autonomous vehicle unit of General Motors.

Created in 2009 as Google’s driverless car project, the company has since amassed the biggest fleet in the industry, with more than 600 self-driving vehicles, as well as accumulating the most miles driven and offering the only true — albeit limited — “driverless” ride-hailing service.

But the cash infusion comes at what could be a turning point for the company. Speaking in an interview with the Financial Times this week, John Krafcik, the former auto industry executive who runs Waymo, suggested he was in the process of reconsidering the kind of business he wants the company to be.

“Our role could be just focusing on the Driver” — the name given to its driverless technology — “and leaving the rest of the customer [experience] to others in the industry,” said Mr Krafcik, indicating a possible shift from bona fide self-driving car maker and robotaxi operator to supplier of autonomous-driving technologies to other companies.

He also suggested that a Renault Nissan alliance, announced with no details last year, could lead to the launch of driverless taxi services in France and Japan fronted by the carmakers. 

“It’s possible the branding isn’t Waymo One,” said Mr Krafcik, referring to the nascent robotaxi service the company now runs in Arizona — the first service of its kind with paying customers, albeit with safety drivers monitoring some of the vehicles. 

Instead, the services could leave the “customer touch points” with carmakers themselves, pushing Waymo into the background. 

Mr Krafcik has hinted in the past that a similar approach might work in Italy with Fiat Chrysler, which already supplies minivans to Waymo to be fitted out as fully autonomous vehicles. Such an approach could provide a way to take Waymo’s technology global, with carmakers in the forefront. 

“The world is changing,” he said. “Soon, the metric people will be focused on will not be the number of cars that are sold each year, but the number of trips taken or miles driven.”

The Waymo chief’s willingness to reconsider some of the most basic tenets of its business comes at a crucial moment for the self-driving industry, which is entering a period of consolidation as the costs of taking on its many facets become increasingly apparent.

The UK driverless technology company FiveAI this week joined the list of AV companies to scale back their ambitions, narrowing its focus to developing only parts of the artificial intelligence required. After it raised a far more modest $41m, chief executive Stan Boland said the capital needed for everything from integrating all the necessary technologies to negotiating with cities and regulators “is simply huge”.

He added that the result of these financial demands would be to leave only a handful of AV platforms — each made up of a “consortia of players or have unfettered access to large pools of capital”.

Among the players jostling for dominance with Waymo is General Motors, which has had commitments of more than $6bn for its Cruise division. Meanwhile, the ride-hailing company Uber and AV group Argo — now jointly controlled by Ford and Volkswagen — have also brought in multibillion-dollar investments.

“All of these companies are going to have to raise hundreds of millions, billions of dollars,” said Josh Wolfe of Lux Capital, a venture investor that has backed Zoox, which is building a driverless car of its own. “The good news is the enthusiasm is high and the field is narrowing.”

As important as the money Waymo has raised, according to Mr Krafcik, are the partnerships the company has been forging. Google’s driverless car ambitions have long been feared in the auto industry. Breaking down the distrust and building a network of alliances has become a high priority — one reason why the Waymo boss has been considering new ways of doing business alongside the carmakers. 

Some of these partnerships have now been sealed by an investment, including one with the parts maker Magna International. This points to one way in which the company may evolve, as it sheds its involvement in hardware to focus on the brains and operating system underpinning driverless cars. 

Mr Krafcik said that while it has been a key part of Waymo’s business to design the hardware and own the intellectual property behind the sensors in its vehicles, “it needn’t be that way going forward”. Magna could take over parts of that work.

Narrowing its focus on the core technology could turn Waymo into a pure tech company offering a range of services to carmakers, said Mike Ramsey, an analyst at Gartner. That could make its business more akin to the massive cloud computing platforms that Google and a handful of others have built, he added, working in the background to supply much of the computing power and AI on which other businesses depend.

Investment from the car retailer AutoNation, meanwhile, has served to highlight Waymo’s aspiration to deliver goods as well as people. It already carries parts for the car retailer, as well as having a partnership with the delivery service UPS. This week it announced a new service to ship goods, called Waymo Via, making this its second nascent commercial operation, after Waymo One.

For his part, Mr Krafcik does not rule out the possibility of getting out of the consumer business — but he also does not dismiss continuing, and clearly has no intention of giving up on potentially huge new markets that have barely begun to take shape.

“The future is very unclear,” he says. “One of the things we hold dear is to maintain optionality.” With billions of dollars in the bank and everything to play for, it does not make sense to narrow the horizons quite yet.

FT : China’s post-virus stimulus: no silver bullet

China’s post-virus stimulus: no silver bullet
The world should not expect another bailout by Beijing

If there is any good news related to the spread of Covid-19 across the globe, it is that the crisis in China itself may be subsiding. Outside Hubei province, still in effective lockdown, the number of confirmed new cases has fallen sharply enough for authorities in many provinces to gently encourage people back to work. Traffic levels are rising, subways in Beijing and Shanghai are beginning to fill up and energy consumption is revealing signs of economic life.

That said, residual uncertainty continues to restrain economic activity. Schools remain closed, for example, and “social distancing” policies are in evidence: in Beijing, shoppers have been instructed to keep two square metres of space around them.

So the best one can say is that we are somewhat closer to the point where the Chinese government can claim “mission accomplished” in its effort to defeat the virus.

Yet even short of total victory — whose final symbol will be Xi Jinping’s visit to Wuhan — it makes sense to turn to the question of what kind of economic stimulus the world can expect from Chinese policymakers.

The best reason to expect a pretty strong stimulus from China is that the authorities there have faced two simultaneous threats. One is the threat to its legitimacy if it fails to control the virus. Another is the threat to its reputation for competence if it fails to support the economy. But these threats have been tough to counter at the same time: minimising the virus problem, which requires limits to human interaction, almost demands maximising the economy problem.

For this reason, most of the support that the government and central bank have offered so far is largely concentrated on ensuring the supply of food and medicine, and on providing liquidity and regulatory support for companies whose ability to repay debt could be jeopardised by declining income. Banks have been encouraged to offer debt repayment holidays in exchange for officially-sanctioned delays to recognising non-performing loans.

This means that real support for the economy — necessary for Mr Xi to keep his 2012 promise to double China’s 2010 per capita GDP by next year — can only move up a gear once the virus threat is contained.

The two most relevant weapons in China’s policy arsenal are likely to be infrastructure spending and measures to support the real estate sector. Mr Xi has already referred to the possibility of accelerating the delivery of “major projects” and, thanks to decisions taken last year, local governments in January went on a borrowing spree to issue Rmb700bn ($100bn) of project-related “special” bonds, so a decent amount of funding is in place for the near term. The quota for the full year could top Rmb3tn when it is finally announced.

Support for the real estate sector will be more limited. In the past couple of years, the Chinese authorities’ real estate policy has been guided by the principle that homes are for living in, and not for speculating on. And since most of the sharp increase in household debt during the past five years has been the result of mortgage borrowing, there may be reluctance to go all out.

That said, new regulatory measures — easing residence requirements, supporting developers’ refinancing needs, reducing downpayments and minimum holding periods — seem very likely. 

On two occasions in the past 12 years, Chinese stimulus has delivered a strong and most welcome positive shock to the world economy. The first was the aftermath of the global financial crisis, a huge exercise of investment-generating policymaking that was sustained over three years. The second was in 2016-2017, giving a boost to emerging economies and the eurozone in particular.

China can have these globally significant effects because of its dominating influence on the global investment cycle, which in turn shapes global trade. Since 2010, China has been responsible, on average, for more than 60 per cent of global investment growth.

But it would be wrong to expect any future stimulus to have anything like the impact of the last two occasions. In the past couple of years, Chinese economy policy has been stimulus-shy for a reason. Thanks to the progressive stretching of Chinese balance sheets since 2009, financial stability is a much more prized objective than it used to be. A financial stability “lobby” — including the central bank, the banking and insurance regulator and the finance ministry — has tended to hold sway.

Indeed, an article by finance minister Liu Kun last month in Qiushi, the Communist party’s main journal, seemed to quash the idea of a substantial post-crisis stimulus, arguing instead for a “tight balance” as both central and local governments will need to respond to the pressure of lower revenues.

So even if the 2019-nCoV virus disappears fast, the world economy should not expect another bailout by China. And depending on how the virus spreads, the rest of the world may not be in much of a position to respond to Chinese stimulus if it does come. Which in turn, of course, creates additional risks to Chinese growth.

David Lubin is head of emerging markets economics at Citi.