· Latest on the spread of the coronavirus around the world
- Total confirmed cases: More than 1,603,163
- Total deaths: At least 95,693
- The coronavirus COVID-19 is affecting 209 countries and territories around the world and 2 international conveyances: the Diamond Princess cruise ship harbored in Yokohama, Japan, and the Holland America's MS Zaandam cruise ship.
- US cases: At least 468,566, and deaths: 16,691
- Spain cases: At least 153,222, and deaths: 15,447
- Italy cases: At least 143,626, and deaths: 18,279
- Thailand cases: At least 2,423 (+54), and deaths: 32 (+2)
- Treasury Secretary Steven Mnuchin also told CNBC on Thursday the U.S. economy could be re-opened in May. He noted the department was doing “everything necessary that American companies and American workers can be open for business and that they have the liquidity that they need to operate their business in the interim.”
- JPMorgan now sees economy contracting by 40% in second quarter, and unemployment reaching 20%
JPMorgan economists issued an even more dire forecast, now foreseeing a 40% decline in the nation’s gross domestic product for the second quarter and a surge in April’s unemployment rate to 20% with 25 million jobs lost.
In an earlier forecast, they said second-quarter GDP would be down 25%.
The economists, however, continue to see a second-half recovery, based on the assumption that disruptions from the pandemic fade by June. They note that the number of people seeking unemployment benefits has totaled 16.8 million in just three weeks.
“With these data in hand we think the April jobs report could indicate about 25 million jobs lost since the March survey week, and an unemployment rate around 20%,” they wrote, “Given the expected hit to hours worked this quarter we now look for -40.0% annualized real GDP growth in 2Q, down from -25.0% previously.”
- Federal Reserve unveils details of $2.3 trillion in programs to help support the economy
The Federal Reserve on Thursday announced a bevy of new moves aimed at getting another $2.3 trillion of financing into businesses and revenue-pinched governments.
Stock futures jumped after the announcement, which came moments after the government reported that 6.6 million new jobless claims were filed last week.
Among the Fed’s measures were details regarding its Main Street business lending program and several other initiatives it is undertaking to backstop the reeling U.S. economy. The central bank also provided more detail on its market interventions, including plans to buy corporate bonds both at an investment-grade level as well as high-yield, or junk, bonds.
Under provisions outlined for the first time, the loans would be geared toward businesses with up to 10,000 employees and less than $2.5 billion in revenues for 2019. Principal and interest payments will be deferred for a year.
The Fed will purchase up to $600 billion in loans.
- Coronavirus could push half a billion more people into poverty globally, UN warns
The coronavirus pandemic could result in between 420 million and 580 million more people, or 8% of the global population, living in poverty, a study by the United Nations University has found.
Researchers based their calculations on the most extreme scenario of a 20% decline in income or consumption around the world. This looked at people falling below the three international poverty lines of living on less than $1.90, $3.20 or $5.50 a day.
Higher estimates could mean that half of the overall global population of 7.8 billion people could be living in poverty by the end of the pandemic. There were 3.4 billion people living on less than $5.50 a day in 2018, which are the latest official recorded figures.
Even based on its “low” scenario of a 5% fall in income or consumption, this could lead to the first increase in global poverty since 1990, the authors stated in the paper which was published Thursday. In this case, researchers forecast that as many as 135 million people, or nearly 2% more of the world’s population, could become destitute as a result of COVID-19.
- EU ministers seal deal on half a trillion euro coronavirus rescue plan
European Union finance ministers agreed on Thursday on half-a-trillion euros worth of support for their coronavirus-battered economies after weeks of wrangling that exposed painful divisions in the bloc headed for a steep recession.
But the agreement does not mention joint debt issuance to finance recovery - something Italy, France and Spain pushed strongly for but which is a red line for Germany, the Netherlands, Finland and Austria.
- Spanish lockdown likely into May, though coronavirus deaths slow
Spain’s prime minister warned on Thursday that nationwide confinement would likely last until May even though he said the worst should soon be over as the death toll slowed from one of the world’s most devastating coronavirus’ outbreaks.
- Canada expects coronavirus deaths to soar; job losses hit 1 million
Canada’s coronavirus death toll is set to soar from more than 500 currently to as high as 22,000 by the end of the pandemic, health officials said on Thursday, while the economy lost a record 1 million jobs last month.
Prime Minister Justin Trudeau said the country would not return to normal until a vaccine is developed, which could be as long as 18 months.
· Dollar drops after Fed launches new loan program
The dollar dropped broadly on Thursday after the Federal Reserve rolled out a $2.3 trillion effort to bolster local governments and small and mid-sized businesses in its latest move to keep the U.S. economy intact as the country battles the coronavirus pandemic.
The central bank’s announcement came as data showed that the number of Americans seeking unemployment benefits topped 6 million for the second straight week, with businesses closed across the country in an attempt to stem the spread of the virus.
The Federal Reserve will continue to use all the tools at its disposal until the U.S. economy begins to rebound fully from the harm caused by the novel coronavirus outbreak, Fed Chair Jerome Powell said on Thursday, even as he acknowledged the limits of the central bank’s powers.
The dollar index measuring the greenback against a basket of currencies fell to a one-week low of 99.50.
The dollar dipped 0.15% against the Japanese yen to 108.81 yen.
The euro gained 0.64% to $1.0926.
· 10-year Treasury yield falls slightly after big jump in jobless claims
The benchmark 10-year Treasury yield fell slightly Thursday as investors weighed another jump in jobless claims as well as new Federal Reserve measures to backstop the reeling U.S. economy amid the coronavirus crisis.
The yield on the benchmark 10-year Treasury note, which moves inversely to price, was marginally lower at around 0.75% while the yield on the 30-year Treasury bond rose slightly to 1.37%.
The Labor Department said Thursday 6.6 million Americans filing first-time unemployment claims in the week ended April 4 as the economic toll of the coronavirus pandemic becomes more apparent. That brings the total over the past three weeks to more than 16 million.
· US weekly jobless claims jump by 6.6 million and we’ve now lost 10% of workforce in three weeks
Jobless rolls continued to swell due to the coronavirus shutdown, with 6.6 million Americans filing first-time unemployment claims last week, the Labor Department reported Thursday.
That brings the total claims over the past three weeks to more than 16 million. If you compare those claims to the 151 million people on payrolls in the last monthly employment report, that means the U.S. has lost 10% of the workforce in three weeks.
· Oil sinks as market doubts OPEC supply cuts will be enough
Oil prices tumbled on Thursday on doubts that a deal between OPEC and allies to make a record oil supply cut would be enough to offset the collapse in global fuel demand caused by the coronavirus pandemic.
The Organization of the Petroleum Exporting Countries and its allies including Russia, a group known as OPEC+, agreed to cut output by 10 million barrels per day from May, the group said in a statement.
Before the coronavirus outbreak hit global transportation and economic activity, 10 million bpd was about 10% of global supply.
OPEC+ expects other producers including the United States to cut another 5 million bpd. But Washington has not offered to participate, and even if it did, the combined reduction in supply would be about half the 30% worldwide fall in demand
Brent LCOc1 futures fell $1.36, or 4.1%, to settle at $31.48 a barrel, while U.S. West Texas Intermediate (WTI) crude CLc1 dropped $2.33, or 9.3%, to settle at $22.76.
· OPEC and allies agree to historic 10 million barrel per day production cut
OPEC and its allies, known as OPEC+, on Thursday agreed to historic production cuts that will take 10 million barrels per day offline as the coronavirus pandemic saps demand for crude. The agreement came as the oil-producing nations held an extraordinary meeting to discuss production policy amid falling oil prices.
The group will cut 10 million barrels per day in May and June, 8 million barrels per day from July through the end of the year, and 6 million barrels per day beginning in January 2021 and extending through April 2022, according to Reuters.
The agreement was not contingent on nations outside of OPEC+ curbing production, which some had suggested might be a stipulation for Saudi Arabia and Russia to scale back production. The group did, however, call on other producers, such as the U.S., to cut production by an additional 5 million barrels per day, according to Reuters.
“Although 10 million bpd will help the market on the short term to not fill up storage, it is a disappointing development for many, who still realize the size of the oil oversupply,” said Rystad Energy’s head of oil markets Bjornar Tonhaugen.
Reference: CNBC, Reuters, Worldometers
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