Closed Coronavirus latest: Florida, California and Arizona report big jumps in deaths – as it happened

florida-doctor-spraying_2048x1152 ©Tampa Bay Times via AP

Today’s top news: Florida and Arizona report new daily highs in Covid-19 deaths. Lloyds slumps to loss after warning on UK outlook. Markets slip as economic data highlights pandemic’s impact.


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California became the US state with the third highest number of coronavirus deaths since the pandemic began after reporting a one-day jump of nearly 200 fatalities. A further 197 people died, the state reported, pushing the total number of deaths in California to 8,715.

Kodak has seen its market capitalisation multiply by 14 in two days after the former giant of the camera business refocused its lens on making ingredients used in generic drugs. The company’s shares were on track to close at their highest level since Kodak emerged from bankruptcy in 2013.

US crude oil stocks fell sharply last week as imports plunged, refineries pumped more fuel, and petrol demand surged. Total petrol demand rose by 260,000 barrels a day last week, said the Energy Information Administration.

Florida joined only a handful of US states to have reported more than 200 deaths in a single day. A further 217 people died, the state health department revealed.

Greece has made it mandatory to wear face masks in shops, banks and public offices following a spike in Covid-19 cases. The deputy citizens’ protection minister, Nikos Hardalias, said masks should also be worn “in all closed spaces and where social distancing is not possible”.

Denbury Resources has joined the pile-up of American oil and gas producers filing for bankruptcy protection in the wake of a price crash. The heavily indebted Texas-based oil producer said it had agreed a restructuring plan that would see it eliminate $2.1bn in debt.

The US trade deficit in goods narrowed in June as exports jumped after coronavirus lockdowns that had disrupted the flow of goods around the world started to ease. The advance trade gap in goods shrank to $70.6bn last month, down from $75.3bn in May.


Texas crosses 400,000-case mark and reports leap in deaths

Peter Wells

Texas has become the fourth US state to confirm more than 400,000 coronavirus cases over the duration of the pandemic, and also revealed its death toll topped 6,000. A further 9,042 people tested positive for Covid-19 over the past 24 hours, the state’s health department revealed on Wednesday, taking the total number of infections to 403,307.

Last week, the overall totals of California and Florida both crossed the 400,000-case-mark and days later overtook New York to become the US states with the highest numbers of confirmed infections. A further 313 people died, according to Texas’s health department, taking the total number of fatalities to 6,190, the ninth-highest among US states.

The latest jump ranks among the biggest reported by any US state during the pandemic, as only New York, New Jersey and Pennsylvania have ever reported more than 300 fatalities in a single day, according to Financial Times analysis of Covid Tracking Project data.

Texas’s health department announced on Monday it would now report coronavirus fatalities based on death certificates. That led to a one-time revision that added more than 600 previous deaths to the state total, although Covid Tracking Project remains confident it can “manually” allocate these fatalities to earlier dates.

The latest figures from Texas mean the three most populous states in the US today revealed historic increases in deaths. California, the most populous state, reported a record 197 deaths to give it the third-highest death toll in the country. Florida, the third-most populous state, reported 217 new deaths, a record high for the second day in a row.


Brazil reports record 69,000 new coronavirus cases

Andres Schipani in Brasília

Brazil on Wednesday topped a daily record of coronavirus infections and fatalities following a controversial laissez-faire approach to the crisis from President Jair Bolsonaro.

Official data showed 69,074 new cases and 1,595 deaths, mainly due to a delay in testing, health ministry officials said.

Brazil currently trails second only behind the US for the number of positive cases of Covid-19, with more than 2.5m infections, and also for deaths, with a little over 90,000 fatalities since the pandemic began in Latin America’s largest country.

“Captain Corona”, as detractors of Mr Bolsonaro call the former army captain, has repeatedly downplayed the seriousness of the pandemic despite having tested positive for the virus.

On Saturday Mr Bolsonaro claimed to have recovered after his latest test was negative.


Asia-Pacific equities rise after Federal Reserve pledges to support US economy

Asia-Pacific stocks rose on Thursday after the Federal Reserve warned the US economic recovery was dependent on the course of the pandemic.

In Japan, the Topix was up 0.3 per cent, South Korea’s Kospi added 0.4 per cent and the S&P/ASX 200 in Australia also rose 0.4 per cent.

Wall Street stocks and gold rose while the dollar dropped on Wednesday after the Federal Reserve held interest rates and warned that the economy will “depend significantly on the course of the virus”. The central bank pledged to provide more support if needed and extended its dollar swap lines to March 2021.

The first estimate of US second-quarter growth will be released later on Thursday giving further clues on how the pandemic has hit the country. Economists expect a record 35 per cent fall.

Overnight, S&P 500 ended the day 1.2 per cent higher and the technology-heavy Nasdaq Composite added 1.4 per cent. Gold climbed to a new record high on Wednesday, rising above $1,980.

The precious metal edged down to at $1,964 an ounce in early Asia trading, while the dollar index hovered at a two-year low.


Samsung forecasts demand for mobile devices will see gradual recovery

Song Jung-a in Seoul

Samsung Electronics expects a gradual recovery in demand for mobile devices and consumer electronics in the second half after the pandemic battered smartphone sales.

The world’s largest producer of computer chips, smartphones and electronic displays presented an upbeat outlook, although it remained cautious about lingering risks amid persisting uncertainties from the pandemic.

The optimistic projection came after the South Korean company posted resilient second-quarter earnings despite the pandemic battering the global economy.

The company reported a 7.23 per cent rise in second-quarter net profit to Won5.6tn ($4.6bn) on strong demand for computer chips driven by the work-from-home trend. Operating profit jumped 23.48 per cent year on year to Won8.1tn while sales fell 5.6 per cent to Won53tn in the April-June period.

Samsung expects demand for mobile and graphic memory chips to recover in the second half, helped by new smartphones and game consoles. Operating profit at the semiconductor division, which accounted for two thirds of its earnings, jumped 60 per cent to Won5.43tn in the second quarter.

“Looking to the second half, overall demand for D-ram is expected to pick up from new smartphone launches, while uncertainties remain around geopolitical issues including trade disputes,” Samsung said on Thursday.

Its mobile division fared better than expected despite the global recession with quarterly operating profit rising 25 per cent to Won1.95tn.

The company plans to launch a new foldable phone and a new Galaxy Note flagship smartphone in August and will seek to expand sales of mid-tier models. It expects the number of 5G subscribers and demand for smartphones with stronger camera features to increase in the second half.

Shares of Samsung continued to rise on Thursday for the fifth consecutive session on heavy foreign buying sparked by expectations that the chipmaker may benefit from Intel’s plan to outsource more chip manufacturing.

Its shares were up 1.36 per cent at Won59,800 on Thursday morning, near its highest level in about five months, outperforming a 0.65 per cent gain in the benchmark Kospi composite index.


New coronavirus cases in Hong Kong to drop to zero in 4-6 weeks, says university

The number of new coronavirus cases in Hong Kong is expected to drop to zero within four to six weeks if social-distancing measures are maintained, according to research from the University of Hong Kong.

Ben Cowling, a professor of epidemiology, said the university’s research estimates that the daily reproductive number dropped below 1 a week ago. The reproductive number indicates the average number of people to whom an infected individual will pass the virus.

“Of course, if we were now to relax, transmission could resurge,” he said. “If the measures started on 20 July are sustained, we should see daily case numbers drop to zero within around 4-6 weeks. We may also need two weeks of zero cases before deciding measures can be relaxed.”

After initial success in controlling the spread of the virus in Hong Kong, a series of quarantine loopholes sparked a third wave of infections this month.

The city has now recorded eight consecutive days of more than 100 cases, taking the overall number to 3,003, with 24 deaths.

In response, the government has instructed civil servants to work from home, forced restaurants to offer only takeaway service and introduced rules on mask wearing outside, even when exercising. It has also limited the number of people who can gather in public to two, unless they are from the same household.

Images of construction workers taking lunch breaks at the side of roads or in parks during a downpour drew criticism after the new dining-in ban was introduced on Wednesday.

Late on Wednesday, the government said it would allow people to eat their lunches in community centres, subject to temperature testing and social distancing measures.


Australia reports record number of new Covid-19 cases

Jamie Smyth in Sydney

Australia reported a record number of new Covid-19 cases on Thursday, as authorities struggled to contain an outbreak in the state of Victoria that added 723 infections to the national tally.

Fresh outbreaks in New South Wales and Queensland – the latter not having reported a locally transmitted case for several weeks – have prompted authorities to close some state borders and implement tighter social distancing measures in several areas.

Six new cases in Queensland have been linked to an interstate trip taken by three young people, who allegedly lied to border police about visits to Sydney and Melbourne, the city at the centre of Victoria’s outbreak.

Katarina Carroll, Queensland police commissioner, said the three women had gone to “extraordinary lengths to be deceitful”.

“I am very disappointed with them at this stage. They went to extraordinary lengths to be deceitful and deceptive, and quite frankly criminal in their behaviour and it has put the community at risk.”

Queensland declared Sydney a Covid-19 hotspot this week and said it would close its border to travellers from the city on Saturday.

On Thursday New South Wales reported 18 new cases.

Australia enjoyed significant success in suppressing spread of the coronavirus following an initial outbreak in February. But a second wave of infections in early July, linked to blunders in Victoria’s hotel quarantine system, has forced the state to implement a second lockdown and request assistance from the Australian Defence Force.

The previous record number of cases in Victoria was 532, as reported on Monday.

The renewed spread of coronavirus dealt a fresh blow to the Australian economy, with NAB’s quarterly survey of small and medium-sized businesses showing a record decline in confidence, conditions and capacity utilisation.

“The deterioration was broad-based across sectors – but the accommodation, cafes and takeaway sector saw a massive decline of 66 points. Not surprisingly it is now the weakest sector,” said Alan Oster, NAB chief economist.

Australia has reported a total of more than 16,000 Covid-19 cases.


Kodak shares rise nearly 1,500% on Covid drug loan deal

Eric Platt in New York and Kadhim Shubber in Washington

Kodak shares have surged 1,481 per cent this week in heavy trading as the Trump administration offered the former photography industry leader a financial lifeline to make ingredients in drugs used to fight coronavirus.

The company’s valuation jumped from $92m to $1.5bn as its shares rose from $2.10 at Friday’s close to $33.20 on Wednesday.

The stock was halted more than a dozen times within the first two hours of trading on Wednesday, a day after it more than tripled in value.

The pace of trading far surpassed anything seen since the company returned to the New York Stock Exchange after its emergence from bankruptcy in 2013.

Kodak, which is based in Rochester, New York, and the US International Development Finance Corporation, announced on Tuesday that the company had secured a $765m loan to produce drug ingredients under the Defense Production Act.

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China reports highest number of new local Covid-19 cases since March

Health authorities in China reported 102 new locally transmitted cases of Covid-19 in the highest one-day tally since early March, as outbreaks in Xinjiang and Liaoning continued to grow.

The western region of Xinjiang reported 96 new cases to the end of Wednesday, taking its total since mid-July to 420. All the new cases were found in the regional capital Urumqi, with state media saying that more than 1.5m people had been tested for the virus.

Liaoning reported six new cases, bringing its total to 58 over the past week, with infections concentrated in the port city of Dalian. More than 3.5m testing samples had been taken from the city’s residents, who had been asked not to leave town, state media said.

Beijing reported one new case of Covid-19.

A further three imported cases take the overall recorded number of Covid-19 cases in mainland China to 84,165.


Choc waves: how coronavirus has shaken the cocoa market

Emiko Terazono in London and Neil Munshi in Brussels

The Covid-19 crisis has taken a big bite out of the chocolate market, causing a collapse in demand that has sent cocoa prices sharply lower and created “disastrous” conditions for farmers.

The New York benchmark for cocoa beans has fallen by almost a quarter since its February high, hitting a 15-month low of $2,150 a tonne earlier this month. Though prices have recovered a little in recent days, hedge funds have continued to increase their bets against the commodity, moving into their biggest net short position this year.

“Clearly, funds don’t believe this is the bottom,” said Andrew Rawlings, analyst at Rabobank.

Shifts in supply patterns are normally the cause of fluctuations in cocoa prices. But the virus has shifted attention to demand, as Covid lockdowns disrupted sales of chocolate at airports, hotels, restaurants and speciality boutiques.

As a result, global “grindings” — the amount of cocoa processed by the industry — fell by 8.2 per cent in the second quarter, according to data from industry associations. That was the largest year-on-year decline since 2014.

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Outbreaks highlight disparities in UK test and trace regimes

Andy Bounds in Carlisle and Sarah Neville in London

Prime Minister Boris Johnson promised a “world-beating” test and trace programme to stop the spread of coronavirus by June. Carlisle — and the rest of England — is still waiting.

Public health officials in the northern city have been fighting a rise in cases for four weeks. But efforts to manage the outbreak have been hampered by incomplete data, overstretched local officials and a lack of testing facilities.

There have been more than 20 localised outbreaks of coronavirus in England and Wales since the UK began emerging from lockdown in June. But the two nations have different test and trace models, and their strengths — and weaknesses — can be seen in the different responses to upsurges in Carlisle and Merthyr Tydfil, a former mining community in south Wales.

In Wales the “test, trace, protect” service is run regionally while the English “test and trace” programme is centrally controlled under its chief executive, Dido Harding. When an outbreak is discovered, local public health teams are brought in to manage the outbreak. But the latest figures show that England’s scheme only reaches four in every five people testing positive.

When Merthyr Tydfil saw a sudden rise in cases last month, local health authorities quickly traced the outbreak to a single factory. Kelechi Nnoaham, director of public health for Cwm Taf Morgannwg University Health Board, which handled the outbreak, put this down to an agile surveillance system, smooth working between different agencies, and a test and trace system organised at regional level.

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Vietnam reports 9 new coronavirus cases amid Da Nang outbreak

Vietnam has reported nine new coronavirus cases, including one in the capital Hanoi, as an outbreak from a popular tourist destination grows.

The new infections take the tally since Saturday to 43, the government said, with 34 of the cases found in the coastal city of Da Nang.

Vietnam had recorded months without a new outbreak and has managed to avoid any fatalities linked to Covid-19. The country has reported a total of 459 coronavirus cases.

The patient in Hanoi had travelled to Da Nang three weeks ago, visiting a hospital there after experiencing an irregular heart beat.

On Wednesday, 219 Vietnamese labourers arrived back in the country on an evacuation flight from Equatorial Guinea. Of those on board, 120 tested positive for coronavirus.

The Vietnamese government plans to repatriate around 18,000 overseas Vietnamese workers.


Global stocks climb after Fed expands dollar liquidity

Hudson Lockett in Hong Kong

Global stocks edged higher and gold lost ground after the US Federal Reserve expanded measures to boost dollar liquidity in the face of the coronavirus pandemic.

Hong Kong’s Hang Seng rose 0.6 per cent in early trading on Thursday while Australia’s S&P/ASX 200 gained 0.7 per cent.

Japan’s benchmark Topix was little changed and China’s CSI 300 index of Shanghai and Shenzhen-listed stocks slipped 0.2 per cent.

Overnight on Wall Street, stocks climbed as the Fed held off on any significant changes to monetary policy but extended measures to deal with the risk of an international shortage of dollars, including extending swap lines with other central banks.

The Fed warned the US economic recovery “will depend significantly” on the course of the coronavirus pandemic. The S&P 500 closed 1.2 per cent higher while the tech-focused Nasdaq rose 1.4 per cent.

“The pace of the recovery looks like it has slowed since the cases began that spike in June,” Jay Powell, the Fed chair, told a press conference in reference to a US surge in Covid-19 cases.

Gold, which has rallied to all-time highs in recent sessions, fell 0.3 per cent to $1,964.36 per troy ounce. The metal frequently serves as a haven in times of uncertainty.

The dollar index, which measures the currency against its international peers, held steady near a two-year low in Asian trading.

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Fed plans for ‘the worst’ as it waits for Congress to act

James Politi in Washington and Colby Smith in New York

The Federal Reserve took little action at its meeting this week, but sent plenty of dovish signals to investors — highlighting its worries about the impact of coronavirus on a US recovery, its hopes that Congress will renew fiscal stimulus, and its willingness to add monetary support.

“We’ve got to hope for the best and plan for the worst,” Jay Powell, the chairman of the US central bank, said at his press conference on Wednesday, after a two-day gathering of the Federal Open Market Committee.

“We’re in this until we’re well through it,” he said. “The picture is, you have the lockdown, then you have the reopening, but there’s probably going to be a long tail where a large number of people are going to be struggling to get back to work.”

Mr Powell had been cautious about the prospects of a speedy rebound from the Covid-19 crisis, but his anxieties and those of other Fed officials appeared to have grown in the past few weeks, underpinning their willingness to provide as much of their own stimulus as they can.

“The Fed is committed to keeping its foot on the gas. It has floored it and is still flooring it . . . and there is no indication they will back away from it,” said Tad Rivelle, chief investment officer of fixed income for TCW. “They are scared.”

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How safe is air travel during the coronavirus pandemic?

Tanya Powley and Peggy Hollinger in London and Michael Peel in Brussels

As airlines rush to return their fleets to the skies, the industry is battling to restore confidence among travellers that flying in an enclosed aircraft with hundreds of people is not as risky as it may seem.

Over the past month, the aviation industry — from carriers, to aircraft manufacturers, to airports — has stepped up its campaign to address safety concerns about the spread of coronavirus as it looks to recover from the worst crisis in its 100-year history.

“All the data we can look at tells us that aeroplanes are less of a risk than any equivalent public place [such as] bus, train, restaurant or a workplace,” said Dr David Powell, medical adviser at Iata, the airline global trade body.

But he admits the sector faces a “widespread perception that airliners are a dangerous place”.

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Investors brace themselves for earnings deluge

It is going to be a big morning for earnings reports from major companies in the UK and Europe.

Earnings season so far has highlighted the stark division in pandemic winners — for example, makers of disinfectant such as Reckitt Benckiser — and losers, such as London’s Heathrow Airport.

Today’s docket includes names such as France’s Airbus, Swiss lender Credit Suisse, beer giant AB InBev and UK lender Lloyds Banking Group.

We’ll have the results here on this live coverage page as we do every working day. If you have not done so already, make sure also to sign up for Cat Rutter Pooley’s London pre-market update and commentary, City Bulletin.


Standard Chartered profits tumble as virus prompts loan losses

Primrose Riordan in Hong Kong

Standard Chartered’s earnings fell in the second quarter as the bank suffered heavy credit impairment charges and announced redundancies amid the coronavirus pandemic.

Pre-tax profits at the emerging markets-focused lender fell 40 per cent year-on-year during the period to $733m, the bank said in a statement on Thursday. The figure was, however, above the $550.6m estimated by analysts polled by Bloomberg.

The decline in profits came as credit impairment charges rose to $611m in the second quarter from $176m a year ago.

The lender on Thursday also confirmed it would push ahead with “a small number” of job cuts but did not say which sections of the business would be affected.


AB InBev books $2.5bn writedown as pandemic depresses beer sales

Judith Evans in London

The world’s largest brewer Anheuser-Busch InBev took a $2.5bn writedown on the value of its operations as the Covid-19 pandemic heavily cut into global appetite for beer.

The Belgium-based brewer of Budweiser, Stella Artois and Corona said the impairment charge related to the company’s African units, which in a “worst-case scenario” from the impact of the pandemic would be worth less than their previous book value.

Lockdowns and strict limits on socialising across much of the world cut sharply into beer sales during the second quarter, but AB InBev said performance had improved towards the end of the period as restrictions eased.


Volkswagen sinks to €1.4bn loss despite cost cuts and factory closures

Peter Campbell in London

Volkswagen fell to a loss in the second quarter, as the world’s largest carmaker succumbed to the effects of the pandemic despite cutting costs and re-closing factories in order to reduce output.

Pre-tax profits fell from a profit of €9.6bn in the first half of 2019 to a loss of €1.4bn, with revenues down 23 per cent to €96bn, and car sales falling 27 per cent to 3.9m vehicles.

After re-opening some of its plants following shutdowns in March, VW was forced to close some lines again because of weaker-than-expected demand.

The group still expects to make a profit in the full year, though “severely lower” than last year’s level.

“The first half of 2020 was one of the most challenging in the history of our company due to the Covid-19 pandemic,” said chief finance officer Frank Witter.

We introduced comprehensive measures aimed at reducing costs and securing liquidity early on, which enabled us to limit the impact of the pandemic on our business to a certain degree.

Due to the positive trend exhibited in our business over the past few weeks and the introduction of numerous attractive models, we look cautiously optimistic to the second half of the year.


Fast food giant Yum China reports drop in sales for second consecutive quarter

Sun Yu in Beijing

Sales at Yum China, the nation’s largest fast food chain, fell for the second consecutive quarter in the three months to the end of June as the coronavirus pandemic discouraged local residents from dining out.

The operator of popular brands such as KFC and Pizza Hut reported $1.9bn* in total revenue in the second quarter, down 11 per cent from a year before. That compared with a 24 per cent drop in the first quarter.

Profits were also hit with net income plunging 26 per cent year-on-year in the second quarter, compared with a 72 per cent slump in the first quarter.

In a statement, Yum China said businesses showed signs of recovery but remained below pre-pandemic levels due to a decline in traffic in transportation hubs and tourism destinations, delayed and shortened school holidays and a resurgence in regional virus infection.

Sales had fallen 30 – 50 per cent at airports and train stations, Yum China said.

“Our recovery is nonlinear and uneven,” said Andy Yeung, Yum China’s chief financial officer. He added that the problem would remain unless “there is a significant change in situation”.

*This post has been amended to correct the stated currency of the Yum China’s total revenue and to clarify the fall in sales at airports and train stations.


Airbus vows to improve cash flow as orders crumble

Peggy Hollinger

Airbus pledged it would stem a heavy cash outflow in the next six months despite a rising number of undelivered aircraft, as it swung into the red in the first half of a year that has ravaged the aviation industry.

The group made the pledge despite signalling an expected charge of between €1.2bn and €1.6bn to pay for the biggest job reduction plan in its history as a result of the collapse in global aviation. Some 15,000 jobs will be cut from the commercial aircraft division.

Airbus said on Thursday it had been unable to deliver some 145 passenger jets as a result of the coronavirus pandemic, while total deliveries in the first six months were roughly 50 per cent down on last year. Deprived of the usual payments from customers on delivery, Airbus reported a €12.4bn outflow of cash in the first half, before any deals of customer financing, up from a deficit of €4bn last time.

Roughly €4.4bn of the outflow was in the second quarter, on a par with the first quarter if the fine to settle a global bribery investigation is excluded. Consolidated net debt stood at €586m at the end of the first half, against year end net cash of €12.5bn.

The group reported a first-half net loss of €1.9bn against net income of €1.2bn in the same period last year.


Hong Kong government reverses ban on restaurant dining

Hong Kong has reversed a decision to restrict restaurants to takeaway only, a day after limits were put in place to help stem the spread of coronavirus.

The government had banned dining in at restaurants from Wednesday, expanding limits on restaurant dining after 6pm that were introduced a week earlier as the city faces what it calls a third wave of infections.

Hong Kong has reported more than 100 new coronavirus cases for eight consecutive days that experts say were sparked by loopholes in the government’s otherwise strict quarantine requirements.

The government said the ban had created inconvenience for workers. Construction workers were photographed eating their lunch at the side of the road and on the steps of pedestrian overpasses, causing an outcry.

Restaurants will be permitted to serve meals up until 6pm from Friday, but diners will be limited to two people per table, in line with restrictions on public gatherings. Restaurant owners must also reduce capacity by half and place tables 1.5m apart.


South Korea to allow large firms to have venture capital units

By Song Jung-a in Seoul

South Korea plans to allow big companies to have venture capital affiliates as part of measures to prop up the country’s coronavirus-hit economy.

The move comes amid falling investment in start-ups in Asia’s fourth-largest economy despite abundant market liquidity after the Bank of Korea cut interest rates to record low levels and the government rolled out unprecedented stimulus measures.

However, the government will impose some restrictions to prevent large conglomerates from using venture capital units as private coffers, allaying public concerns over reckless expansion and the abuse of economic power.

Venture capital units of large companies will be restricted from borrowing more than 200 per cent of their paid-in capital while their founding family members will be barred from investing in their venture capital affiliates.

Through its latest stimulus measures, the government hopes to see excess market liquidity flow into promising start-ups. “Their venture capital units are expected to boost economic vitality and innovation,” said finance minister Hong Ham Ki at a meeting with other economy-related ministers.

The government plans to provide Won40tn ($33.6bn) in financial support to 1,000 innovative firms over the next three years, Mr Hong added.


Renault sinks to record €7.3bn loss in the first half of 2020

David Keohane

Renault tumbled to a record €7.3bn loss in the first half of the year as the pandemic hammered sales and the contribution from its alliance partner Nissan also plunged into the red.

The French carmaker recorded a net loss of €7.29bn, heavily impacted by the losses at Nissan which Renault says cost it €4.8bn in the first half. Renault owns 43 per cent of the Japanese carmaker which has decided to not pay out a dividend which it has long relied on to lift its earnings.

Revenues at Renault fell 34 per cent, compared with the same period last year, to €18.4bn, while sales fell 35 per cent.

“Although the situation is unprecedented, it is not final… we are fully dedicated to correcting the situation through a strict discipline that will go beyond reducing our fixed costs,” said new chief executive Luca de Meo, who joined this month.

The group burned through €6.4bn in cash in the first half and said it was not in a position to give full-year guidance. But it confirmed a €600m cost reduction target for this year.

In May, Renault announced a three-year €2bn cost-cutting plan that will see it shed 15,000 jobs and cut global production capacity from 4m vehicles in 2019 to 3.3m by 2024.

Before the arrest of Carlos Ghosn on charges of financial misconduct in Japan — a pivotal moment in the recent history of the group and its alliance with Nissan — the group’s head had targeted selling more than 5m vehicles by 2022.

Renault’s results contrast sharply with that of French rival PSA, the owner of Peugeot, which managed to eke out a profit of €595m in the first half of the year. PSA is gearing up to complete a merger with Italian-American Fiat Chrysler, a group with whom Renault also came close to a deal.


Pet lovers help Nestlé push up sales in pandemic

Judith Evans in London

Households buying high-end pet food online helped Nestlé narrowly beat expectations for the first half, despite the pandemic cutting into sales of water and confectionery.

The world’s largest food manufacturer, which makes brands including Kit Kat chocolate bars, Nespresso coffee and Purina pet food, said organic first-half sales growth was 2.8 per cent, ahead of the 2.3 per cent that analysts had expected.

It was led by premium pet food brands Purina Pro Plan and Purina One, as households continued pampering their animals in lockdown, including buying the products online. Overall, Nestle’s ecommerce sales surged almost 50 per cent to reach 12.4 per cent of overall sales.


Trading surge helps Credit Suisse bump up pre-tax income

Owen Walker

Credit Suisse benefited from a surge in trading and the Swiss domestic market’s resilience to the coronavirus pandemic to increase pre-tax income for the second quarter by 19 per cent compared with a year earlier.

The Swiss bank also announced sweeping changes to its structure as new chief executive Thomas Gottstein set about putting his mark on the business.

The group reported pre-tax income of SFr1.6bn ($1.75bn) for the quarter, while its net income attributable to shareholders rose by 24 per cent compared with a year earlier to SFr1.2bn. Its domestic wealth management business and global markets units provided the bulk of the group’s revenues, while its investment banking and capital markets division beat analysts expectations and returned to profit.

Having booked SFr568m of provisions for bad loans in the first quarter, Credit Suisse added SFr296m in the second quarter.

Mr Gottstein said: “In a continued volatile market environment, we delivered a strong performance. Despite persistent challenges caused by Covid-19, our employees again showed outstanding commitment and dedication.”

As part of the restructuring, the group announced a new investment banking division, combining its previous global markets, investment banking and capital markets and Asia-Pacific markets business lines. Credit Suisse also combined its risk and compliance divisions.

Announcing the changes, Mr Gottstein said: “These initiatives should also help to provide resilience in uncertain markets and deliver further upside when more positive economic conditions prevail.”


Lloyds slides to £676m loss as outlook for UK economy darkens

Nicholas Megaw in London

Lloyds Banking Group fell to a £676m loss in the second quarter, after the UK’s lockdown had a “much larger than expected” impact on the economy.

The company put aside a further £2.4bn to deal with expected customer defaults, up from £1.4bn in the first three months of the year. There was a particularly large jump in provisions for soured mortgage loans, which the bank blamed on an “additional reduction in house price forecasts” since its last trading update.

Mortgages had largely been excluded from the first wave of coronavirus-induced loan loss provisions earlier this year, but Lloyds’ announcement on Thursday follows a similar report from smaller rival Virgin Money, which warned on Monday about the impact of rising unemployment.

Lloyds, the UK’s largest retail bank, added that it had seen some signs of improvement in recent weeks, with rising levels of consumer spending and housing market activity. However, it said the outlook “remains highly uncertain and the impact of lower rates and economic fragility will continue for at least the rest of the year.”


Total maintains dividend despite collapse in profits after oil price crash

David Keohane in Paris

France’s Total saw profits collapse by 96 per cent in the second quarter, as energy prices were sent tumbling during the Covid-19 pandemic, but kept its dividend in place.

The oil major’s adjusted net income fell to $126m in the second quarter, compared with $2.9bn in the same period last year. Total said the results were helped by a strong performance by its trading unit, exceeding analysts’ expectations for a loss of $443m, according to Bloomberg. Cash flow from operations fell 44 per cent to $3.5bn.

Total “faced exceptional circumstances: the Covid-19 health crisis with its impact on the global economy and the oil market crisis with Brent falling sharply to $30 per barrel on average, gas prices dropping to historic lows and refining margins collapsing due to weak demand,” said the group’s chief executive Patrick Pouyanné.

Total also cut its crude output forecast for the year to between 2.9m to 2.95m barrels per day, from 2.95m to 3m, and reduced its planned investment to below $14bn, from $15bn beforehand.

On Wednesday evening, Total slashed the value of its carbon-heavy oil and gas assets by $8.1bn, including an “exceptional asset impairment charge” of $2.6bn, mainly on Canadian oil sands and liquefied natural gas assets in Australia.

With oil prices falling and renewable energy expected to keep climbing, the group also upped its estimate of so-called stranded assets in its portfolio — those assets with reserves beyond 20 years and high production costs, whose overall reserves may therefore not be drilled out of the ground by 2050. That led to another impairment of $5.5bn, also in Canadian oil sands.

Total is not the first oil major to warn of writedowns, as companies accept the reality that the impact of the pandemic on oil and gas prices, as well as an accelerating shift to renewables, could endure, potentially rendering billions of dollars worth of assets economically unviable.


Shell’s key profit metric sinks 82% but oil major avoids loss

Anjli Raval in London

Royal Dutch Shell escaped a loss in the second quarter after stronger oil trading results helped to offset plunging energy demand triggered by the coronavirus pandemic that has battered the entire sector’s finances.

The Anglo-Dutch major reported adjusted earnings — the measure most closely watched by analysts — of $638m in the three months to June 30, from $3.5bn in the same period the previous year. Despite an 82 per cent drop, during one of the industry’s most brutal quarters, it beat the $674m loss that analysts had expected.

Strong crude and oil products trading alongside lower operating expenses buffered Shell from the plunge in energy prices.

Shell also announced a post tax impairment charge of $16.8bn, which the company had previously signalled, after it overhauled its price outlook and confronted the longer-term impact of coronavirus on its finances, demand for energy products and the global economy. The charge knocked Shell to a loss on a reported basis of $18.1bn.


Insurers dented by pandemic and market volatility

Oliver Ralph in London

Profits at Generali halved in the first six months of the year as the insurer dealt with the fallout from the coronavirus crisis.

The company, which is Italy’s largest insurer, said that turmoil in the investment markets cost it €226m, while it also made a €100m contribution to a pandemic emergency fund.

First-half profits were also hit by a €183m arbitration settlement with BTG Pactual over the 2015 sale of BSI, a Swiss private bank.

Overall, net profits at the company dropped 57 per cent to €774m, although operating profits were flat as improvements in asset management and property & casualty insurance were offset by lower profits from life insurance.

Results from UK-based insurer RSA were also dented by the market volatility in the first half of the year. Pre-tax profits fell 7 per cent to £211m as a stronger underwriting result was offset by investment losses and restructuring charges.


AstraZeneca posts strong results after launch of new medicines

Donato Paolo Mancini in Rome

AstraZeneca saw its profits, revenues and cash flow all grow during the first half of the year, bucking a trend among pharmaceutical majors that have begun to feel the effect of a coronavirus-related global economic slowdown.

Revenue for the first half grew 14 per cent at constant currencies to $12.63bn, while its core earnings per share bounced 26 per cent to $2.01. 

Sales were lifted by the performance of new medicines, as well as by its oncology and respiratory and immunology products. Revenues grew in every region of the globe, the drugmaker said on Thursday as it released numbers.

Net cash from operating activities grew $688m to $1.18bn, driven by an improvement in business performance.

Pascal Soriot, chief executive, said he was “confident” about the future. “We are retaining our full-year guidance that is underpinned by the focus on commercial execution and an exciting pipeline of new medicines,” he said.


Hedge fund Man Group sees $1.7bn in outflows

Laurence Fletcher in London

Man Group, the world’s biggest-listed hedge fund firm, suffered $1.7bn in client outflows during the three months to June, even as it benefited from a sharp rebound in markets in the wake of March’s coronavirus-driven sell-off.

However, the combination of investment losses earlier in the year and client withdrawals meant that the firm’s assets have still dropped by 8 per cent, or $9.4bn, since the start of the year.

Man’s results come amid signs that the hedge fund industry has suffered investor withdrawals and performance losses during the coronavirus crisis but not on the scale seen during the global financial crisis.

The firm’s first-half profits dropped to $94m from $157m as performance fees earned on its funds slumped. Man said that investors pulled money from some of its computer-driven long-only and absolute return funds.


Self-isolation period for anyone with symptoms in England to be extended

Laura Hughes in London

The government on Thursday is expected to increase the length of time people with coronavirus symptoms in England must self-isolate from seven to 10 days.

Under the current guidance, anyone with symptoms, including a “new, continuous” cough or high temperature, must stay at home for seven days. Everyone living in their household must stay at home for 14 days.

Amid fears over a looming “second wave” of the Covid-19 pandemic across Europe, Chris Whitty, the chief medical officer, is expected to announce a three-day extension of the self-isolation guidance for people with symptoms.

“This is a decision that’s clinically led”, health secretary Matt Hancock told Sky News on Thursday morning.


Anglo American keeps dividend despite lockdowns hitting profits

Neil Hume in London

Anglo American stuck with its policy of paying out 40 per cent of earnings as a dividend even as profits slumped in the first half of the year because of the impact of Covid-19 lockdowns on its operations.

The London-listed miner posted underlying earnings before interest, tax, depreciation and amortisation of $3.4bn in the six months to the end of June, down 39 per cent on the same period a year ago.

As a result of the decline in earnings its interim dividend almost halved to 28 cents per share and was funded from borrowings. Anglo’s net debt rose about $4.2bn to $7.6bn during the period.

Anglo’s operations in South Africa were hit hard by coronavirus-related lockdowns, contributing to an 11 per cent drop in production.

Its diamond business De Beers also suffered and the company is set to address staff today on a restructuring plan.

“The whole strategy has been thought through quite well and we will articulate that in the next couple of days,” said Anglo chief executive Mark Cutifani on a call with journalists on Thursday. He declined to say if jobs would be affected.

Underlying ebitda at De Beers was just $2m in the first half of 2020.


Spanish inflation falls more than expected

Federica Cocco

Spanish consumer prices fell by more than expected in July, reflecting lower energy prices and weak demand in sectors that have been most affected by the spread of coronavirus.

Consumer prices dropped by 0.7 per cent in July from a year earlier, down from their 0.3 per cent annual fall in June, flash data from the National Statistics Institute (INE) showed on Thursday. Economists polled by Reuters had expected a fall of 0.2 per cent.

The Spanish economy is facing a fresh hit from renewed lockdowns and international travel restrictions after an increase in cases of the virus. Strict lockdown measures introduced since mid-March to deal with the initial spread of the pandemic caused energy prices to plummet, although disruption to supply and labour chains meant that the price of food and beverages rose.


BAE to resume paying dividends

BAE Systems expects strong demand for defence equipment to cushion it from the worst impact of the pandemic, as it outlined plans to restart shareholder payouts.

Britain’s largest defence contractor said it would restore its planned 2019 dividend, which was deferred earlier in the year as disruption from the coronavirus crisis ripped through businesses. It also outlined an interim first-half dividend.

BAE, which builds hardware including F-35 fighter jets and combat vehicles, said it expected sales to increase by a low single-digit percentage compared with last year, as strong volumes in its defence portfolio offset weakness in the commercial business.

The group reported a slight rise in sales to £9.8bn in the first-half of this year, while underlying earnings per share slipped 14 per cent to 18.7p.

“Assuming no significant Covid-19 resurgence, we expect a good second half to the year,” chief executive Charles Woodburn said. Shares rose 5 per cent in morning trading.


Movers and shakers: AB InBev, Rentokil, Volkswagen and Lloyds

Earnings season is in full swing with a succession of results this morning from Royal Dutch Shell, Renault and BAE to Credit Suisse, Nestlé and Generali. Here are the biggest risers and fallers across Europe following the reporting of quarterly earnings that lay bare the impact of coronavirus on some of the world’s largest companies.

Risers

Brewer AB InBev soared as much as 10 per cent after it was upbeat on the recovery in global beer sales in June.

BAE systems led the gains on the FSTE 100, jumping almost 6 per cent following the defence contractor reporting strong demand that will cushion it from the worst impact of coronavirus.

Pest control company Rentokil followed them closely, gaining about 4 per cent as its hygiene and disinfection business grew by 10 per cent in the first half of the year off the back of a rise in demand triggered by coronavirus.

Credit Suisse gained 2 per cent after a trading surge lifted profits at the Swiss bank.

Airbus, AstraZeneca and Total were among other large European companies to report results that received a positive share price reaction from investors.

Fallers

Lloyds Banking Group slumped 9 per cent, after falling to a £676m loss in the second quarter. It said the UK’s lockdown had a “much larger than expected” impact on the economy.

Renault fell 2.2 per cent, despite tumbling to a record €7.3bn loss in the first half of the year. Peugeot maker Groupe PSA slipped by a similar amount, while Volkswagen shed about 5 per cent after cutting its dividend by a third.

Mining group Anglo American fell 3 per cent, after it raised debt to pay out its dividend.

Other notable companies to slip lower after reporting results included advertising group Publicis, Italian oil producer Eni and insurer RSA.


German economy contracts by record 10.1% in second quarter

Delphine Strauss and Chelsea Bruce-Lockhart

Germany’s economy shrank at the fastest pace in at least half a century in the second quarter of 2020, according to data that confirm the depth of the recession suffered by Europe’s largest economy

German gross domestic product fell 10.1 per cent quarter-on-quarter, the largest decline since quarterly calculations began in 1970 – and far bigger than the decline seen at the height of the global financial crisis, the statistical agency said on Tuesday. The year-on-year fall in GDP in the second quarter, at 11.7 per cent, was also the largest on record.

The fall in output is worse than analysts had expected, and underlines the challenge facing European policymakers as fears grow over a second wave of infections that would delay the economic recovery.

Germany’s statistical office said a “massive slump” in exports and imports of goods, in household spending and in capital formation had been offset to an extent by government stimulus.

The total number of unemployed people in Germany fell in July, according to separate figures, suggesting its labour market is beginning to recover from the economic shock of the pandemic.

The official seasonally adjusted figure for the total number of people who were unemployed in Germany in July fell to 2.923m, from the revised 2.941m recorded for the previous month. This was a reduction of 18,000.

The unemployment rate in Europe’s largest economy remained at 6.4 per cent in July. This was lower than the 6.5 per cent expected by a group of economists polled by Reuters.

German unemployment has been curtailed by the government’s Kurzarbeit, or short-time work, scheme which subsidises companies to continue employing their staff.


ArcelorMittal expects Covid stimulus measures to boost steel demand

Michael Pooler in London

ArcelorMittal said that government spending plans for economic recovery after coronavirus would help steel demand return to normal levels, but it stuck to a “cautious” outlook despite signs of activity picking up.

The steelmaker and mining group said the low-water mark had now passed in what it described as “one of the most difficult periods in the history of the company”.

Steel consumption plummeted as car factories and building sites shut due to Covid-19 lockdowns, heaping extra pressure on an industry that has suffered from chronic oversupply for years.

“Our base case remains that demand level in the medium term normalises, i.e. returns to pre-Covid levels,” said chief financial officer Aditya Mittal.

That’s primarily driven by the level of significant stimulus that has been enacted in many of the core markets in which we operate [and] whether it’s fiscal or monetary spending, is quite unprecedented.

The Luxembourg-based group, which is among the world’s top steel producers, surpassed analyst expectations by posting earnings before interest, tax, depreciation and amortisation of $707m for the second quarter of 2020. That was down by more than half year-on-year.

A $2bn capital raise earlier this year reduced ArcelorMittal’s net debt to $7.8bn and it said once a $7bn target was reached it expected to resume paying dividends, which have been suspended.

Shares in the company rose 1.8 per cent on Thursday morning to €9.80.


Italian unemployment rate rises

Federica Cocco

Italy’s unemployment rate has risen as people resume job hunting after coronavirus lockdown measures stalled the country’s economy and pushed millions of people out of work.

The unemployment rate rose by 0.5 percentage points to 8.8 per cent in June, marginally above economists’ expectations, according to data published by Italy’s national statistics agency (Istat).

The number of economically inactive people declined by 99,000, pushing the country’s inactivity rate down to 36.8 per cent from 37.1 per cent the previous month.

The employed population fell by 46,000, a smaller decline than the 83,000 people who dropped out of employment in the previous month. The majority of those who lost their jobs were women, whereas 30,000 men returned to work.

In Italy, as in many other European countries, unemployment levels have been partly cushioned by a government furlough scheme which helps employers to cover wage costs; 8.2m people received payments for short-time work in June.

Bert Colijn, senior economist for the eurozone at ING, said the country’s unemployment rate was likely to rise considerably in the months ahead.

That is not just due to continued job market weakness and more people returning to looking for work, it is also because many people are currently still on short-time work,” he added.

Once government subsidies end, another run up in unemployment can be expected.


Car dealerships Pendragon and Inchcape to cut thousands of jobs

Peter Campbell in London

Pendragon and Inchcape announced thousands of job losses as falling car sales caused by the pandemic hit dealerships and vehicle delivery companies.

Pendragon, which owns Evans Halshaw and Stratstone brands, announced 1,800 UK job losses as it closes 15 lossmaking sites and restructures the company.

Some 400 roles will be lost through the closures, and another 1,400 through a move towards a “leaner and more sustainable operating model [that] is necessary to safeguard the Pendragon business” the company said on Thursday.

Inchcape, which owns dealerships and operates a global car moving business, announced “a reduction of our global workforce” as part of a group overhaul after the company fell to a £188m pre-tax loss for the first half of the year.

The losses come hours after Britain’s motor industry body, the Society of Motor Manufacturers and Traders, warned the sector was braced for further job cuts because of the pandemic, which has sapped consumer demand for new vehicles.


Eurozone economic sentiment improves as lockdowns ease

Federica Cocco and Chelsea Bruce-Lockhart

Economic sentiment across the eurozone improved in July after modest pick-ups in May and June, as governments relaxed restrictions introduced to stem the coronavirus pandemic.

The European Commission’s monthly survey of economic sentiment in the bloc rose to 82.3 in July, up from 75.8 in June. This was better than the 81 reading expected by economists surveyed by Reuters.

Industry and services recorded the sharpest gains, however consumer sentiment remained gloomy, dropping to minus 15, well below the long-term average of minus 11.1.

Employment expectations have however improved markedly, according to the European Commission’s indicator, reaching 87 from 83 in June. The largest euro area economies – France, Germany, Italy and Spain – all registered increased confidence.

Eurozone unemployment rose to 7.8 per cent in June, according to data released by Eurostat, the European Union’s statistics agency, a marginal rise from 7.7 per cent in May. Some 203,000 people lost jobs bringing the total unemployed to 12.685m people.


US drugmaker Eli Lilly raises earnings guidance

Hannah Kuchler in New York

Eli Lilly raised earnings guidance for the full year despite declining revenue in the second quarter due to lower prices for some drugs and the Covid-19 pandemic delaying new patients from starting treatments.

The US pharmaceutical company said it now expected adjusted profits per share which exclude certain items (non-gaap), of between $7.20 and $7.40, higher than its previous guidance of between $6.70 and $6.90, in part because of lower selling and marketing expenses. The forecast is dependent on patient visits to doctors unrelated to Covid-19 bouncing back in the second half.

David A. Ricks, Eli Lilly’s chairman and chief executive, said Covid-19 “continues to strain healthcare systems around the world”. Eli Lilly is working on two potential antibody therapies for treating the disease, both of which have finished their phase one trials.

In the second quarter, revenue declined 2 per cent to $5.5bn, missing the average analyst estimate of $5.8bn. Sales suffered a $500m hit related to the pandemic: about half of which was because of stockpiling in the first quarter, and half attributed to patients putting off new prescriptions. Changes in rebates and discounts meant the company received less for its diabetes products.

But non-gaap earnings per share beat expectations at $1.89, higher than the consensus forecast for $1.56.


J&J coronavirus vaccine elicits ‘robust’ immune response in early study

Donato Paolo Mancini in Rome and Hannah Kuchler in New York

The pre-clinical data, published in Nature magazine, show Johnson & Johnson’s jab successfully prevented subsequent infection in non-human primates, spurring so-called “neutralising antibodies”. It also provided complete or near-complete protection against Covid-19 in their lungs.

“The findings give us confidence as we progress our vaccine development and upscale manufacturing in parallel,” said Paul Stoffels, J&J’s chief scientific officer.

The six non-human primates that received a single jab showed no detectable virus in the lower respiratory tract after exposure, and only one showed “very low” levels of the virus in a nasal swab at two different points in time, J&J said.

A phase-three trial, pending satisfactory results from the studies currently under way, is expected to begin in September, comparing the single dose of the immunisation against a placebo. J&J is also planning a phase-three trial comparing two doses versus placebo, it said.

The drugmaker is aiming to include a significant representation of African-American and Hispanic volunteers, demographics that have been hard-hit by the pandemic, in its phase three trial programme.


Tui to close 166 UK stores amid second bout of holiday cancellations

Alice Hancock in London

Tui, Europe’s largest tour operator, plans to close 166 of its UK travel shops as part of a wider move to cut 8,000 jobs and minimise costs while international travel remains at all-time lows.

The company said that the plan to cut stores would affect 900 jobs but that it would move about 630 of those into a new homeworking sales team.

As fears of a second wave of coronavirus in Europe have increased in the past week and governments have cautioned against travel to affected areas, holiday operators have been hit by another spate of cancellations.

In May, Tui said that its monthly cash costs were between €250m and €300m while global travel was in near-total shutdown – a figure that increased by up to €200m if it refunded customers in cash.

This week, Tui’s UK business cancelled all holidays to Spain until August 10 and to the Canary and Balearic Islands until August 4, following the UK government’s imposition of quarantines from travellers returning from those regions.

It said it had added more flights to Turkey and Greece and was encouraging customers to switch holidays to different destinations rather than cancel.

Andrew Flintham, Tui UK and Ireland’s managing director, said that the move to cut stores was a reflection of more people booking holidays online:

Customer behaviours have already changed in recent years, with 70 per cent of all TUI UK bookings taking place online. We believe Covid-19 has only accelerated this change in purchasing habits.

Tui will have 350 shops remaining in the UK after the cuts.


P&G boosted as coronavirus shifts consumer habits

Alistair Gray

Procter & Gamble, the consumer goods bellwether behind Fairy liquid and Pampers nappies, said it expected to emerge from the pandemic in a stronger position as housebound consumers continue to buy more of its paper towels, tissues and dish-washer tablets.

Organic sales at its fabric and home care division, whose brands include Ariel detergent and Mr Clean sprays, surged 14 per cent, helping the group’s net revenues in the three months to the end of June rise 4 per cent from a year ago to $17.7bn.

David Taylor, chairman and chief executive said: “We expect to grow through this crisis and come out even stronger on the other side.”

Organic sales rose in each of P&G’s five divisions apart from grooming, where they dipped 1 per cent. Men with no need to go to workplaces are shaving less, weighing on sales of Gillette razors.

The company’s baby, feminine and family care division also performed strongly, with organic sales up 5 per cent. P&G produced net earnings of $2.8bn compared with a loss of $5.23bn the same period one year ago.

The figures followed a similarly strong performance in the previous quarter. Shares in P&G have been trading near record highs, recovering sharply from a period of underperformance. They rose 2.4 per cent in pre-market trading.


Comcast revenues fall less than expected on broadband growth

Anna Nicolaou in New York

Comcast continued to enjoy surging demand for high-speed internet in the working-from-home era. But coronavirus disruptions to its theme parks and movie studio weighed on results, delivering double-digit declines in adjusted net income and revenues for the Philadelphia-based company.

The cable giant added 323,000 high-speed internet customers in the three months ending in June as Zoom calls and remote working persisted. This was up 54 per cent from a year ago.

However, the pandemic has damaged Comcast’s media businesses, as shuttered cinemas and theme parks dragged down NBCUniversal. Revenues at the Universal film studio dropped 18 per cent to $1.2bn as it postponed blockbusters such as Fast and Furious 9.

Universal’s theme parks, some of which reopened in June, reported only $87m in revenues in the quarter, a 94 per cent year-over-year decline.

Comcast, like its peers, has been transitioning towards a future dominated by online streaming. The company continued to bleed pay-TV customers as people ditched traditional cable for streaming: it lost 477,000 video customers in the quarter, more than double the losses a year ago.

Peacock, the company’s new streaming service aimed at battling Netflix and Disney, was a bright spot. Comcast said Peacock has signed up 10m customers after launching widely on July 15. The company did not disclose how many of these sign-ups reflected its 30m Comcast cable subscribers who get the service for free.

Overall, Comcast’s adjusted net income fell 12.2 per cent year on year to $3.17bn, or 69 cents a share, while revenues also lost 12 per cent from a year ago to $23.7bn. Wall Street analysts had been looking for 55 cents a share on revenues of $23.75bn.

Shares in Comcast, which are down about 2 per cent year-to-date, rose 2.2 per cent in pre-market trade.


Online shopping boom drives UPS quarterly sales higher

United Parcel Service, considered an economic bellwether, reported a jump in quarterly profits and revenues as pandemic lockdowns drove a surge in online shopping and residential deliveries.

The parcel delivery company said revenues jumped 13.4 per cent from a year ago to $20.5bn in the second quarter, ahead of analysts’ forecasts for $17.48bn, according to a Refinitiv survey. 

The Atlanta-based company said the average daily volume in the domestic market rose to 21.1m packages a day, up 22.8 per cent. That was driven by a jump in residential deliveries, which rose 65.2 per cent. In the overseas markets, average daily volume of deliveries rose 9.8 per cent. However, the company noted the average revenue per piece fell in both segments.

“Our results were better than we expected, driven in part by the changes in demand that emerged from the pandemic, including a surge in residential volume, Covid-19 related healthcare shipments and strong outbound demand from Asia,” said Carol Tomé, UPS chief executive officer.

Online shopping surged during coronavirus lockdowns as people self-quarantined at home and turned to ecommerce for their essential and discretionary purchases.

The company said in the first quarter that residential deliveries accounted for about 70 per cent of of UPS shipments in late March, compared with about half in the same period a year ago. Both UPS and FedEx announced higher delivery prices for residential and large packages earlier this year in response to a surge in online shopping.

Net income rose to $1.77bn or $2.03 a share, compared with $1.69bn or $1.94 a share in the year-ago quarter. Adjusting for one-time items the company reported earnings of $2.13 a share, eclipsing expectations for $1.07 a share. 

UPS shares, which are up 6 per cent year-to-date, jumped 11 per cent in pre-market trade.


ConocoPhillips sinks to $1bn loss on oil price crash

Myles McCormick in London

US oil producer ConocoPhillips has begun to bring production back online after curtailments in the wake of the price crash pushed it to a $1bn loss in the second quarter.

The company — the US’s largest independent producer by market capitalisation — was one of the first big US oil producers to cut back on output as crude prices crashed earlier this year, shutting production across its operations in Canada and the US.

Conoco blamed the loss on production shut-ins, along with weak prices, as it reported grim second-quarter earnings. But it said it was now gradually turning the taps back on: it has restored output in Alaska and expected to be producing at full capacity in the rest of the US by September.

“We are monitoring the market closely to develop a view around the timing and path of price recovery and to guide our corresponding actions,” said Ryan Lance, Conoco chairman and chief executive. “As the market strengthened late in the second quarter, we began reversing our second-quarter curtailments and ramping up production across the Lower 48, Alaska and Canada.”

The company produced 981,000 barrels of oil equivalent a day in the second quarter, including curtailments of 225,000 barrels. That left it down by more than 300,000 barrels compared with the same period last year.

However, the loss off $994m, excluding exceptional items, underlines the malaise in the sector, which has been devastated by a collapse in prices triggered by a Saudi-Russia price war, which sent supply surging, and the coronavirus pandemic, which slashed global demand by a third.

The figure is down from a $1.1bn profit in the same period last year and was worse than the $610m loss analysts had pencilled in.

Total revenues of about $4bn were down by half on last year.


Monthly consumer prices fall in Germany in July

Chelsea Bruce-Lockhart in London

German consumers were faced with lower prices in July compared with the previous month, as the economy struggled to recover from its sharpest contraction in output in half a century.

Germany’s month-on-month change in inflation, which is designed for international comparison, fell to -0.5 per cent in July, down from a rise of 0.7 per cent recorded for the previous month, preliminary figures from Germany’s Federal Statistics Office showed.

The figure, released on Thursday, was lower than the -0.2 per cent anticipated by a group of economists polled by Reuters, as a large drop in energy prices weighed on consumer prices.

Deflation raises concerns that businesses will struggle to recover their costs, which may then result in employment cuts and would place further downward pressure on the economy.

There is also a worry that deflation can become entrenched: as consumers begin to expect lower prices, they hold off on purchases in the hope that products will become cheaper, therefore reducing immediate demand and further damping prices.

When compared with the same month in 2019, Germany’s consumer prices have remained steady.


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US economy suffers sharpest postwar contraction in second quarter

Matthew Rocco in New York and James Politi in Washington

The US economy contracted by the largest amount in postwar history during the second quarter, coinciding with unprecedented shutdowns that closed businesses and left millions of Americans out of work during the pandemic.

Gross domestic product, or the value of all goods and services produced by the economy, shrank at an annualised rate of 32.9 per cent, according to a preliminary estimate from the Bureau of Economic Analysis on Thursday.

That was smaller than economists’ forecast for a 34.1 per cent decline. The economy contracted 9.5 per cent compared with the preceding three months, which is the metric used by other major economies. The data landed just a day before the expiry of supplemental jobless aid for the total 17m unemployed.


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Trump raises prospect of delaying election

Courtney Weaver

President Donald Trump raised the prospect of delaying the November election on Thursday as the president repeated his unsubstantiated claims that the presidential vote would be marred by massive fraud due to more mail-in voting.

https://twitter.com/realDonaldTrump/status/1288818160389558273

Mr Trump does not hold the power to delay the election and any delay would have to be approved by both the Senate and Democratic-controlled US House of Representatives.

Yet experts say the tweet underscores deep concerns about the president’s messaging on the election and mail-in voting, with some election scholars arguing the president could use a high preponderance of mail-in voting to dispute the electoral loss and refuse to leave office, throwing the country into a constitutional crisis.

“Every GOP official should be put on the record on this today,” Rick Wilson the ex-GOP strategist behind the anti-Trump Lincoln Project, wrote on Twitter. “Simple yes or no answer.”


US stocks fall at the open after gloomy data and Trump tweet

Global stock markets dropped on Thursday after figures laid bare the enormous contractions suffered by the US and German economies as coronavirus brought activity to a standstill in spring.

The US economy recorded its largest contraction in postwar history as it shrank at an annualised rate of 32.9 per cent in the second quarter.

The fall was slightly narrower than expected but US stocks slid at the open, with the benchmark S&P 500 down 1.1 per cent and Nasdaq giving up 0.9 per cent.

Futures extended their declines before the opening bell after Donald Trump floated the idea of delaying this year’s presidential election. “It will be a great embarrassment to the USA. Delay the Election until people can properly, securely and safely vote???” the president wrote on Twitter.

The gloomier sentiment sent the price of US government bonds rising, pushing the 10-year yield down 0.03 percentage points to 0.55 per cent.


Mastercard revenues fall as pandemic weighs on spending

Robert Armstrong in New York

Mastercard saw a 10 per cent decline in spending over its network during the coronavirus pandemic in the June quarter, driving a sharp drop in revenue and earnings.

But, like its peer Visa, it said volumes increased steadily as the quarter progressed.

Revenue and earnings per share, at $3.3bn and $1.41, were down 17 and 26 per cent, respectively, but both came in ahead of Wall Street’s expectations.

The most encouraging trend for the company was the progress of spending on its network in the US market: having fallen by almost a fifth in April, it was up slightly in June and, as of the third week of July, is up 5 per cent from a year ago. Outside of the US, volumes remain down in the low single digits.


Oil price slump knocks Reliance’s revenues

Benjamin Parkin in New Delhi

Mukesh Ambani’s Reliance Industries recorded a 44 per cent drop in operational revenue as its core energy businesses were hit by a drop in oil prices, offsetting the growth of its digital unit Jio.

Reliance said that operational revenue in the quarter ended June fell to Rs912bn ($12.7bn) from Rs1.62tn a year earlier, as coronavirus lockdowns and a sharp drop in oil prices hampered operations and demand.

But the conglomerate reported a 30 per cent increase in profit to Rs132bn, thanks to the conclusion of a $1bn investment by BP to set up a joint fuel-retail business.

Mr Ambani, Asia’s richest man, has in recent months overseen an aggressive fundraising drive for Jio, its four-year-old telecom and digital services business, raising $20bn from 13 foreign investors including Facebook and Google. Reliance’s share price has more than doubled since March.

While Jio increased revenues thanks to stronger demand for its services during the lockdown, the gains were offset by sharp drops in revenues in Reliance’s retail and energy businesses.


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Florida reports record increase in deaths for third straight day

Florida reported a record increase in deaths for the third day in a row, even though the state revealed new infections increased by fewer than 10,000 for the fifth straight day.

The state’s health department revealed a further 253 residents had died. However, the total number of non-resident deaths was revised lower to 123 from 124 in Wednesday’s report.

Florida has reported record increases in fatalities for three days in a row. On Wednesday, 217 residents and non-residents died, up from 191 a day earlier. A total of 6,709 people have died from coronavirus there since the pandemic began, the seventh-highest toll among US states.

Alongside California (197) and Texas (313) yesterday, the three most populous states in the country have revealed historic jumps in fatalities over the past 24 hours.

A further 9,956 people in Florida tested positive for coronavirus over the past day, from 9,446 on Wednesday. It is the fifth consecutive day that new infections have been less than 10,000, the longest such stretch since July 1.

That has spurred some optimism that new cases in the big sunbelt states are plateauing, though this is being tempered by the recent surge in deaths there.

More than 95,000 tests were conducted in Florida over the past day, with 12 per cent of those coming back positive.


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Former presidential candidate Herman Cain dies at 74

Former Republican presidential candidate and pizza chain executive Hermain Cain has died more than a month after being hospitalised with coronavirus. He was 74.

Cain, a cancer survivor, was hospitalised in Atlanta on July 1, days after his diagnosis.

“There were hopeful indicators, including a mere five days ago when doctors told us they thought he would eventually recover, although it wouldn’t be quick,” Dan Calabrese, the editor of Cain’s website, said in a post announcing his death. He said Cain “never quite seemed to get to the point where the doctors could advance him to the recovery phase”.

Cain’s diagnosis came less than two weeks after he attended Donald Trump’s reelection rally in Tulsa, Oklahoma, on June 20. Most attendees did not appear to be wearing masks or facial coverings inside the indoor arena.

Almost 143,000 people have died from coronavirus in the US, while the case count has approached 4.39m, according to the Covid Tracking Project.

Last year Cain withdrew his name from consideration for a spot on the Federal Reserve board. He had most recently hosted a show on conservative cable news channel Newsmax TV.


More help should have been given to developed countries – senior WHO leader

Hannah Kuchler in New York

The World Health Organisation should have given more help to developed countries coping with the Covid-19 pandemic, after they have underinvested in their public health systems, according to a senior leader at the global body.

Michael Ryan, executive director of the WHO’s health emergencies programme, said he had been surprised by the slow response of public health systems in countries that do not normally need the help of the WHO. Instead, it focused on “extreme environments” like the eastern Congo, he said.

“If I could go back and change anything, I think we would have also been better served to offer that operational and technical assistance to countries, where I think we made some assumptions about capacities that existed … and skilled workforces that maybe should have existed or should have been expanded,” he said in a WHO press conference.

He added that the WHO is “learning lessons” that there has been “deep underinvestment” in public health, including contract tracing and testing.


Arizona reports record daily jump in fatalities

Arizona reported a record increase in coronavirus deaths, joining other major sunbelt states that have revealed historic daily jumps in fatalities over the past day.

A further 172 people died from Covid-19, Arizona’s health department said today, from 46 on Wednesday. Health officials noted that 78 of the reported fatalities were a result of death certificate matching.

That tops a previous peak of 147 from July 18, according to Financial Times analysis of Covid Tracking Project data, although Arizona’s health department noted that 106 of those were due to death certificate matching.

The latest data push the seven-day rolling average of fatalities in the state to 80 a day, according to FT analysis of Covid Tracking Project data. That is close to a peak rate of 83 on July 21 and compares with an average of about 35 a month ago.

A total of 3,626 people in Arizona have died from Covid-19 since the pandemic began.

Arizona had been showing promising trends compared with some of the other hard-hit states in the sunbelt, which had become the new hotspots of the coronavirus pandemic in the US. Trends in both cases and – until today’s data – deaths had been easing back from peak levels earlier in the month, whereas California, Texas and Florida are averaging record daily fatalities against tentative signs of plateaus in new cases.

Florida this morning reported a record daily increase in deaths, while California and Texas revealed new peaks on Wednesday.

Arizona on Thursday reported 2,525 people had tested positive for Covid-19 over the past 24 hours, the biggest jump in five days, and from 2,339 yesterday.


Kenya to require Covid-19 tests for international travellers after resuming flights

Donald Magomere in Nairobi and Andres Schipani in Brasília

International passengers travelling to Kenya will be required to undergo mandatory Covid-19 testing as the country lifts the suspension of overseas flights effective on Saturday, in a bid to open its tourism sector.

“Testing must be within a period of 96 hours. No passenger will be allowed to travel to Kenya without Covid-19-free certificate,” said James Macharia, Kenyan minister of transport, said on Thursday, adding that passengers from countries with less widespread community transmission will be exempted from the mandatory test. The list includes China, France, Canada, and Rwanda, among others. There will be no mandatory quarantine for arriving passengers unless they are symptomatic.

“These measures in opening up international space will have huge impacts in the tourism and economy sectors. It will bring business and employment,” added Mr Macharia, as Kenya is a popular safari destination that has been feeling the pinch of the pandemic.

Kenya Airways, the benighted nation’s flagship airline, will resume flying internationally on Saturday.

Kenyan authorities forecast the east African nation will reach its peak of virus infections between late August and early September. Kenya recorded 788 more positive cases on Thursday, bringing the total tally of infections to 19,913.


Air France-KLM swings to loss in the second quarter

Air France-KLM announced further cuts to its 2020 capital expenditure plans after it revealed an 83 per cent plunge in revenues and operating loss in the second quarter owing to fallout from the coronavirus pandemic.

The Franco-Dutch airline, which has received financial assistance from its respective governments in an effort to help it weather the crisis, said late on Thursday it did not expect global demand to recover to pre-crisis levels for “several years”.

Though there is still “limited visibility” and customer behaviour has become more “short-term oriented”, the group was slightly more optimistic about capacity in coming months. Management forecast capacity in the third quarter to be 45 per cent of what it was a year ago, and at 65 per cent in the fourth quarter. In May, the company flagged capacity in the third quarter would be down 80 per cent from a year earlier.

Overall group revenues tumbled 83.2 per cent from a year ago to €938m in the three months ended June 30, that underpinned an operating loss of €1.55bn compared with an operating profit of €423 a year ago. The airline reported a net loss of €2.6bn for the second quarter, compared with a €98m net profit 12 months earlier.

Air France-KLM said it would reduce its 2020 capex plan by an additional €300m to €2.1bn, compared with guidance earlier this year of €3.6bn.

Management said in a statement the uncertainties related to the pandemic had prompted it to accelerate a transformation plan. The group has flagged that nearly 7,600 full time jobs across its networks will be cut by the end of 2022. Air-France KLM said these plans would be discussed with unions and a full restructuring plan would be announced in full by October of this year.


Brazil’s first lady tests positive for Covid-19

Andres Schipani in Brasília

Brazil’s government said the first lady has tested positive for Covid-19 only days after her husband claimed to have overcome the infection.

“First lady Michelle Bolsonaro tested positive for Covid-19 on Thursday. She is in good health and will follow all established protocols,” an official statement said.

The news of her infection — and, on the same day, that of Brazil’s science minister, Marcos Pontes, a former astronaut — came a day after Latin America’s largest country reported a daily record of coronavirus infections and fatalities following a controversial laissez-faire approach from hard-right President Jair Bolsonaro.

Official data on Wednesday showed 69,074 new cases and 1,595 deaths. Brazil is second only to the US by total confirmed Covid-19 cases, with more than 2.5m infections, and also deaths, with a little over 90,000 since the pandemic arrived in the country late February.

“Captain Corona”, as detractors of Mr Bolsonaro call the former army captain, has repeatedly downplayed the seriousness of the pandemic despite having tested positive for the virus.

On Saturday Mr Bolsonaro claimed to have recovered after his latest test was negative.


Wisconsin to require masks after rise in cases

Wisconsin will require residents to wear masks, as officials cited an increase in Covid-19 cases across the state.

Governor Tony Evers, a Democrat, declared a public health emergency on Thursday and issued an emergency order mandating that individuals use face coverings in indoor or enclosed spaces, beginning on Saturday. “Face coverings are strongly recommended if you are outdoors and maintaining physical distancing is not possible,” the governor’s office said in a statement.

“While I know emotions are high when it comes to wearing face coverings in public, my job as governor is to put people first and to do what’s best for the people of our state, so that’s what I am going to do,” Mr Evers said.

Andrea Palm, secretary-designee of the state’s health department, said data have shown that Wisconsin has “significant community spread”.

Wisconsin joins other states in the US north and midwest that have recently issued mandates on wearing face coverings amid concerns over an uptick in coronavirus infections. The governors of Ohio, Indiana and Minnesota said last week they would begin requiring masks.

Governors in more than half of US states have issued orders mandating at least some use of face coverings, while others have recommended wearing masks.

Wisconsin has labelled 61 of 72 counties as having a “high” rate of Covid-19 activity, or a case rate that is greater than 100 per 100,000 residents in the past two weeks. In June, only 19 counties were in the same category, according to state figures. The governor’s order declaring a health emergency also noted that Wisconsin has recorded 43 per cent of its coronavirus cases since the start of July.

The Badger State had about 51,000 confirmed Covid-19 cases as of Wednesday. Its seven-day average of new daily cases sat at 886, after peaking at 930 on Sunday.


New cases in California jump back over 10,000, deaths remain elevated

California reported more than 10,000 new coronavirus cases on Thursday for the first time in five days while the daily increase in deaths hovered close to a record.

A further 10,197 people in the US’s most populous state tested positive for Covid-19 over the past 24 hours, officials revealed this afternoon, from 8,755 on Wednesday. It is the fifth-biggest one-day jump on record, according to Financial Times analysis of Covid Tracking Project data.

For the previous four days, infections had risen by fewer than 9,000 a day, including a three-week low of 6,000. That had stirred some hope infections in the Golden State may have reached a plateau, a trend that also seemed to be emerging in other hard-hit sunbelt states like Florida, Texas and Arizona.

Casting a shadow over that trend, though, have been record daily increases in fatalities. California revealed a further 194 people in the state had died from Covid-19, from Wednesday’s record of 197. The state’s overall death toll is 8,909, ranking only behind New York and New Jersey, which were early hotspots for the pandemic in the US.

Earlier today, both Florida and Arizona reported record single-day jumps in deaths, although new cases remained comfortably down from peaks earlier this month. Texas on Wednesday reported an historic 313 fatalities.


Wall Street trims losses after grim economic data

US stocks were mixed as investors reacted to another deluge of corporate earnings and data that confirmed a sharp contraction in domestic economic activity.

The S&P 500 trimmed its losses to 0.4 per cent at the close, having fallen 1.7 per cent earlier in the session. The Nasdaq Composite was up 0.4 per cent on gains across the technology sector. The Dow Jones Industrial Average was down 0.9 per cent.

The Bureau of Economic Analysis said US gross domestic product fell by an annualised rate of 32.9 per cent in the second quarter, which was the largest contraction in postwar history, following unprecedented shutdowns related to the pandemic. Economists had expected a steep decline in economic activity.

In other data, the pace of US jobless claims rose for a second week in a row, and the number of Americans collecting unemployment benefits rose to 17m.

The yield on the 10-year Treasury note neared a record low. It fell 0.04 percentage points to 0.538 per cent. Yields fall as prices rise.

The dollar index, which measures the greenback against global peers, sank 0.4 per cent. Gold was trading 0.8 per cent lower.


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Amazon doubles quarterly profit despite Covid spending

Dave Lee in San Francisco

Amazon’s profits soared in its second quarter, despite heavy costs related to the coronavirus pandemic.

Locked-down shoppers drove sales 40 per cent higher, year on year, to $88.9bn, helping the company record $5.2bn in net income for the quarter — double what it earned in the same period last year, and far higher than analysts’ expectations.

Amazon shares were up more than 6 per cent in the minutes after the news release.

Its surge in profits came despite Covid-19 costs reaching $4bn for the period, in what chief executive Jeff Bezos described as a “highly unusual” quarter involving spending on protective equipment and bonuses for staff.

The company had previously warned investors such costs could mean Amazon recorded its first loss since 2015.

The company said it expected to spend a further $2bn in coronavirus related costs in this current quarter, with sales estimated to land between $87bn-$93bn, up by around a third on the same quarter in 2019.



Remdesivir maker Gilead lifts full-year guidance

Hannah Kuchler in New York

Gilead Sciences became the latest pharmaceutical company to raise guidance for the full year, despite missing expectations in the second quarter as the pandemic hit sales of hepatitis C and preventative HIV treatments.

The California-based biotech group said it now expects product sales of between $23bn and $25bn for the full year, up from a prior range of $21.8bn to $22.2bn. A fall in healthcare visits unrelated to Covid-19 has hit sales at many drugmakers this quarter. Gilead forecasts non-GAAP earnings per share for 2020 of between $6.25 and $7.65, compared with its previous guidance for between $6.00 and $6.45.

Shares in Gilead, which soared earlier in the year on hopes for its antiviral remdesivir, being used to treat Covid-19, fell 1.4 per cent in after-hours trading in New York. The company said it expects to have manufactured more than 2m treatment courses of the drug by the end of 2020 and several million more by the end of 2021.

In the second quarter, Gilead did not meet expectations on either revenue or earnings. It reported sales of $5.1bn, compared with the consensus forecast of $5.3bn and non-GAAP earnings per share of $1.11, lower than the average analyst estimate for $1.45. Gilead made a net loss of $3.3bn, swinging to the red because of a $4.5bn charge related to its deal to buy Forty Seven, a biotech specialising in immuno-oncology.



Apple revenues jump despite global slowdown

Patrick McGee in San Francisco

Apple revenues rose 11 per cent to a new record for the June quarter, trumping forecasts that its business would decline because of the coronavirus-induced slowdown and the closure of Apple stores around the world.

Revenues climbed 11 per cent to $59.7bn, versus forecasts that they would decline 3 per cent to $52.1bn. iPhone revenue rose 2 per cent to $26.4bn, largely thanks to the introduction of the entry model iPhone SE in April, compared with forecasts that they would decline by 14 per cent.

Earnings per share rose 18 per cent to $2.58, a notable gain given that Apple issued a revenue warning in mid-February saying coronavirus had caused a “slower return to normal conditions”. It had been forced to close all of its retail stores worldwide. The majority of its more than 400 stores have since reopened, but dozens have been closed again because of coronavirus flare-ups.

“It’s clear to us our products are very relevant to our customers’ lives and the pandemic has them more relevant than ever before,” Luca Maestri, Apple’s finance chief, told the Financial Times. “People have more time at home so they want to enjoy more digital services.”

Apple announced a four-to-one stock split to make its shares “more accessible to a broader base of investors”. This is the fifth stock split in its history and the first since June 2014.


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Google suffers first revenue decline as ads hit by pandemic

Richard Waters in San Francisco

Google has suffered its first recorded revenue decline, as the coronavirus crisis caused an 8 per cent slide in advertising income in the latest quarter and depressed parent company Alphabet’s revenues by 2 per cent from the year before.

However, the fall-off was less severe than most investors had expected. Ruth Porat, chief financial officer, said the figures reflected “gradual improvement in our ads business,” as well as “strong growth in Google Cloud and other revenues.”

Alphabet’s cloud business posted a 43 per cent jump in revenue, to $3bn. Though the performance echoed the gains reported by other cloud computing companies during the pandemic, the growth was still lower than the 52 per cent of the preceding three months, and below most expectations. Advertising on YouTube climbed 6 per cent, to $3.8bn.

The company’s executives said three months ago that Google had started the second quarter with advertising revenue suffering a “mid teen year on year decline”. But they also surprised investors at the time with the news that they were seeing the first signs of stabilisation in search advertising.

Since then, Alphabet’s shares have risen by 25 per cent, nearly double the rise in the broader US stock market.

Alphabet — which counts on Google for more than 99 per cent of its revenue — reported gross revenue in the latest period of $38.3bn. Net revenue, after deducting traffic acquisition costs, fell by less than a percentage point, to $31.6bn. Earnings per share declined by 29 per cent, to $10.13, as costs rose by 7 per cent, despite a company-wide moratorium on all but essential hiring.

Most analysts had expected Alphabet’s net revenue to fall 4 per cent to $30.5bn in the latest quarter, with earnings per share dropping to $8.34. They had forecast a return to growth in the third quarter, with revenues expected to rebound nearly 3 per cent and earnings per share up 6 per cent.

The internet group’s shares reversed some of their early gains in after-market trading.



Facebook revenue climbs in second quarter

Hannah Murphy in San Francisco

Facebook shares rose nearly 8 per cent after its second-quarter revenue beat analyst expectations, though the social media group warned that the coronavirus pandemic, as well as a boycott of its advertising services, would hamper growth in the current quarter.

Revenues in the three months to the end of June — the majority of which comes from advertising — rose 11 per cent year-on-year to $18.7bn, above analyst expectations of $17.4bn. 

Still, it was the slowest pace of growth since the company listed publicly in May 2012, a testament to how the coronavirus crisis and resulting economic hit has decimated advertising spend from brands. 

Facebook said that it expected revenue in the current quarter to grow about 10 per cent, the pace at which it has increased so far in July, citing the effect from “certain advertisers pausing spend on our platforms” because of a boycott and tightening privacy regulation in the US and Europe. 

More than 1,000 brands, including Ford, Coca-Cola and Verizon, said they would pull digital ad spending from the platform for the month of July because Facebook failed to sufficiently tackle hate speech.


Ford books smaller loss than feared

Claire Bushey in Chicago

Ford reported an adjusted $1.9bn loss before interest and taxes in the second quarter — far better than the $5bn loss its top financial executive predicted three months ago.

Chief financial officer Tim Stone attributed the company’s smaller loss to operational excellence during a quarter when plants were shut down for two months to contain the spread of Covid-19.

“Overall, it’s a good quarter for Ford, in light of the circumstances,” he said.

The company said in a press release that it expects its “strongest” earnings before interest and taxes for the year to come in the third quarter.

Production and sales to dealers were better than the company anticipated in the spring, Mr Stone said. The company also benefited from lower costs and dealers offering lower discounts on vehicles.

According to generally accepted accounting principles, the company managed net income of $1.1bn as its investment in the artificial intelligence company Argo AI gained $3.5bn in value.


US reports more than 1,000 daily deaths for fourth day in a row

Daily deaths from Covid-19 in the US topped 1,000 for the fourth day in a row as several sunbelt states reported historic jumps in fatalities again.

A further 1,291 people in the US died from coronavirus, according to Covid Tracking Project data, from 1,418 on Thursday. The national death toll has increased by more than 1,000 fatalities a day nine times in the past 10 days, taking the overall tally to more than 144,000.

Florida (252) and Arizona (172), among the hard-hit sunbelt states, reported record daily jumps in fatalities. California (194) was just short of Wednesday’s record of 197.

The death toll in Texas rose by 84 from a day earlier to 6,274 as of Thursday, according to Financial Times analysis of Covid Tracking Project data. 

The Lone Star state’s health department announced a series of changes this week to the way it counts deaths. Officials said today that as they shifted to using death certificate data, “an automation error caused approximately 225 fatalities to be included that did not have COVID-19 listed as a direct cause of death” and that they had to correct the cumulative fatalities for July 27, 28 and 29.

A further 69,917 people in the US tested positive for coronavirus over the past 24 hours, from 66,211 on Wednesday, according to Covid Tracking Project data.California (10,197) reported more than 9,000 cases for the first time in five days, while Florida (9,956) and Texas (8,800) also had large increases.

States that had record daily jumps in cases included: Missouri (1,781), Ohio (1,733), New Mexico (597) and Hawaii (108).