cityam--2020-05-26--BoE not remotely close to decision on negative rates, says chief economist

The Bank of England ’ s chief economist has said the bank is not remotely close to any decision on taking interest rates below zero to cope with the pandemic .
Andy Haldane said the key factors for the BoE to consider were the consequences of negative rates for banks and lenders , which would squeeze margins .
Read more : What are negative interest rates and will the UK turn to them ?
“ Those are the aspects that we ’ ll look at , ” Haldane said during an online discussion organised by the Confederation of British Industry @ @ @ @ @ @ @ , reviewing and doing are different things and currently we are in the review phase and have not reached a view remotely yet on the doing.
” Since the start of the coronavirus outbreak , the bank has slashed its main rate to a record low of 0.1 per cent , prompting questions about whether it will cut into negative territory to stimulate the economy further .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
It would mean banks are @ @ @ @ @ @ @ money with their country ’ s central bank .
The European Central Bank ’ s ( ECB ) deposit rate is currently minus 0.5 per cent .
Last week , BoE governor Andrew Bailey said it would be “ foolish ” to rule out negative interest rates .
He has previously argued against them but admitted he had changed his position .
He was keen to highlight that the Bank is not saying it will cut rates further : “ We ’ re not ruling it in but we ’ re not ruling @ @ @ @ @ @ @ recent economic data was coming in a “ shade better ” than a scenario published by the bank earlier this month .
Read more : Economists rule out ‘ V-shaped ’ recovery after weak survey data “ This is perhaps still a V but perhaps a fairly lop-sided V , ” he said , referring to the shape of the economy ’ s downturn and recovery .
“ The risks to that probably…lie to the downside rather than the up and as I say , a rather more protracted recovery even than the @ @ @ @ @ @ @ the news as it happens by following City A.M. on Twitter .

BoE not remotely close to decision on negative rates, says chief economist
The Covid-19 crisis will likely “stretch” the income gaps between the rich and poor, according to Bank of England chief economist Andy Haldane.
The Bank of England’s chief economist has said the bank is not remotely close to any decision on taking interest rates below zero to cope with the pandemic.
Andy Haldane said the key factors for the BoE to consider were the consequences of negative rates for banks and lenders, which would squeeze margins.
“Those are the aspects that we’ll look at,” Haldane said during an online discussion organised by the Confederation of British Industry on Tuesday.
“To be clear, reviewing and doing are different things and currently we are in the review phase and have not reached a view remotely yet on the doing.”
Since the start of the coronavirus outbreak, the bank has slashed its main rate to a record low of 0.1 per cent, prompting questions about whether it will cut into negative territory to stimulate the economy further.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
It would mean banks are charged a small amount for keeping their money with their country’s central bank. The European Central Bank’s (ECB) deposit rate is currently minus 0.5 per cent.
Last week, BoE governor Andrew Bailey said it would be “foolish” to rule out negative interest rates. He has previously argued against them but admitted he had changed his position.
He was keen to highlight that the Bank is not saying it will cut rates further: “We’re not ruling it in but we’re not ruling it out.”
Haldane also said the recent economic data was coming in a “shade better” than a scenario published by the bank earlier this month.
“This is perhaps still a V but perhaps a fairly lop-sided V,” he said, referring to the shape of the economy’s downturn and recovery.
“The risks to that probably…lie to the downside rather than the up and as I say, a rather more protracted recovery even than the one that I have mentioned.”
Get the news as it happens by following City A.M. on Twitter.


cityam--2020-05-26--Inflation post Covid-19: to be or not to be?

We spoke to two experts who argued the case for and against inflation in the near future and what it means for investments .
Abdallah Guezour , Head of Emerging Market Debt and Commodities , and Keith Wade , Chief Economist , discuss the outlook for inflation in the midst of the Covid-19 crisis .
Abdallah argues the case for inflation and explains why we could see inflation between 4-6 % in the next five years .
Keith argues the case against inflation , seeing the lingering impact of Covid-19 keeping a lid on demand and potentially causing a deflationary @ @ @ @ @ @ @ major investment implications .
They discuss the potential winners and losers .
What is the likelihood we will a rise in inflation n the next two or three years ?
The probability of inflation returning in the next two to three years has increased significantly for three main reasons .
Firstly , the current aggressive global monetary and fiscal easing is unprecedented and is likely to create inflationary pressures sooner rather than later .
Money printing by central banks is sky-rocketing , leading to a record surge in money supply globally .
Secondly @ @ @ @ @ @ @ trade war last year have now been exacerbated by Covid-19 lockdowns – meaning less globalisation or even deglobalisation – which is likely to be inflationary .
Thirdly , after a protracted bear market in commodities , and a collapse in oil prices , significant supply destruction is underway .
Any signs of normalisation in demand would increase commodity prices from their current historically depressed levels .
Where could inflation appear first ?
Inflation could appear first in countries with currencies which have seen a severe devaluation such as certain emerging market ( EM @ @ @ @ @ @ @ also start in the US .
Broad US dollar strength in recent years has been deflationary .
The US dollar has been supported by a favourable interest rate and growth differential – both are now disappearing .
The Fed is aggressively monetising the US fiscal deficit .
The US “ twin deficit ” ( both fiscal and current account ) is on course to reach 20 % of GDP this year .
Dollar weakness would be inflationary for the US and globally .
How does QE during Covid-19 crisis differ from that seen @ @ @ @ @ @ @ ( QE ) – where central banks purchase longer-term securities , such as bonds , to increase the money supply and encourage lending and investment – differs from QE seen after the Global Financial Crisis ( GFC ) .
Then , the money printed by central banks did not reach the real economy because it was used to stabilise a financial system on the brink of collapse .
Monetary policy transmission mechanism was broken at that time and most the money printed in the aftermath of the GFC ended in excess reserves of @ @ @ @ @ @ @ asset prices .
This time , QE appears to be reaching the real economy – current money printing is directly financing government spending and supporting bank lending , as illustrated by the ongoing surge in commercial and industrial loans in the US .
Such a surge was not seen during the GFC .
The current QE also appears to be open-ended and has become broad-based .
A number of emerging markets are even now turning to some forms of QE .
All these policies will soon become inflationary .
Global GDP-weighted Consumer Price @ @ @ @ @ @ @ could initially move to 4-6 % in the next three years .
The initial recovery in inflation will actually be positive for the global growth recovery .
However , central banks and governments will not normalise monetary and fiscal policies prematurely .
They will , however , need to do so eventually , as and when markets react to an inflation scare and / or fiscal crisis because of the massive build-up in fiscal deficits globally .
Why might we not see inflation rise ?
The current shock is actually extremely deflationary .
@ @ @ @ @ @ @ the lockdowns , causing prices to come down rather than go up .
The most extreme example of this is in the oil industry where demand has dropped by around a third and the oil price has collapsed .
Recent worldwide inflation data has been very low , with a record drop in US core inflation and a sharp drop in the headline rate .
Lack of demand forces companies have to discount their products – in many cases , they can not sell them at all .
As the economy begins to @ @ @ @ @ @ @ we think companies will still discount quite aggressively so , near term , inflation will be low .
To model inflation , we look at the spare capacity in the economy – the output gap – and the shutdown due to Covid-19 has generated a lot of this .
US unemployment has increased to nearly 15 % and could increase further .
In the UK , two million people have registered for benefits and we see it all across Europe too .
As these economies recover , people will get back to work @ @ @ @ @ @ @ lockdown means the recovery will be gradual too .
We do not see the quick snap back that people had hoped for when the crisis started .
We believe spare capacity will persist and act as a downward pressure on inflation until 2021 and even into 2022 .
As the eurozone and Japan , in particular , had low inflation even before the crisis , we could well see periods of deflation there .
I feel deflation is a greater risk than inflation at present .
For more : – Q & A @ @ @ @ @ @ @ shift ?
– Slumping economy , surging stock market– what ’ s going on ?
– Infographic : A snapshot of the world economy in May 2020 What are the side effects of a lack of inflation and even deflation ?
Japan has spent much of the last decade trying to stimulate its economy and get out of deflation , which indicates how difficult it is to create inflation .
It requires a sustained increase in money supply to get inflation to come through .
At present , the increase in the money @ @ @ @ @ @ @ short of cash and trying to survive .
This is not companies borrowing to spend or invest , which would be inflationary .
In this scenario deflation becomes an issue .
With a big increase in borrowing , if there is deflation , then the real burden of that debt increases , which weighs negatively on economic activity .
Can the economy recover without inflation ?
Economic activity , in the long run , is driven by structural forces and shifts in demographics such as innovation and technology , rather than inflation .
@ @ @ @ @ @ @ probably increase as a result of this crisis .
We will see greater innovation , technology and more recruitment which will be a source of growth .
This is already being driven by the increased demand from an ageing population .
As result of the lockdown , remote working technology , conference calls , remote shopping , etc.
, will all see further growth .
That is the classic process of economic activity – creative destruction created by different events – meaning some jobs are lost but the economy reshuffles and moves resources @ @ @ @ @ @ @ .
It is , however , very difficult to anticipate where demand will come from .
In an inflationary world , which assets , sectors or regions are likely to benefit ?
( Abdallah Guezour ) History shows us that gold tends to perform well during periods of higher inflation .
Currencies of commodity-exporting nations , various commodity sectors and resources equities should perform reasonably well too .
Emerging market high-yielding bonds and equities especially in those countries that could benefit from stronger commodity prices , could also be supported by the possible @ @ @ @ @ @ @ rise in global demand could lead to a surge in some of those commodities because they are trading at very depressed levels and they are generally under-owned by investors .
Government bonds might be the biggest risk because yields are negative in certain developed countries or very low , with very limited return upside potential .
Even if we see a protracted economic slowdown , the performance from these bonds is likely to disappointing in the next few years .
Without inflation , which assets sectors and regions could benefit ?
( Keith @ @ @ @ @ @ @ inflation or deflation , you would want to hold fixed interest , government bonds in particular , i.e .
safe assets .
However , their yields are low so they are discounting a weak economic environment .
More broadly , in credit markets , some investment grade ( low risk ) and high yield bonds are of interest .
The focus should be on finding companies which are resilient and can perform well in this kind of environment .
Areas of growth include the technology , healthcare and biotech sectors .
A lot @ @ @ @ @ @ @ chains more resilient .
For instance , by building more robotics , bringing in artificial intelligence and using fewer people .
In other words , bringing production back home in what is called the fourth industrial revolution .
Another general theme as well is climate change .
Though this is quite different from the Covid issue , you are seeking areas of growth and expenditure that will be sustained though quite a deflationary environment .
Climate change should see quite a lot of investment .
Finding themes is key and quality companies positioned @ @ @ @ @ @ @ that investment .
These innovations might restrict some of the trade within emerging markets which still depend very much on global trade .
Generally I think that it is about searching for companies with more of a micro approach rather than taking a regional or geographical approach to this question .
• You can discover more at Schroders insights and follow Schroders on twitter .
Important Information : This communication is marketing material .
The views and opinions contained herein are those of the author ( s ) on this page , and @ @ @ @ @ @ @ reflected in other Schroders communications , strategies or funds .
This material is intended to be for information purposes only and is not intended as promotional material in any respect .
The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument .
It is not intended to provide and should not be relied on for accounting , legal or tax advice , or investment recommendations .
Reliance should not be placed on the views and information in this document when taking individual investment and/or @ @ @ @ @ @ @ a reliable indicator of future results .
The value of an investment can go down as well as up and is not guaranteed .
All investments involve risks including the risk of possible loss of principal .
Information herein is believed to be reliable but Schroders does not warrant its completeness or accuracy .
Some information quoted was obtained from external sources we consider to be reliable .
No responsibility can be accepted for errors of fact obtained from third parties , and this data may change with market conditions .
This does @ @ @ @ @ @ @ Schroders has to its customers under any regulatory system .
Regions/ sectors shown for illustrative purposes only and should not be viewed as a recommendation to buy/sell .
The opinions in this material include some forecasted views .
We believe we are basing our expectations and beliefs on reasonable assumptions within the bounds of what we currently know .
However , there is no guarantee than any forecasts or opinions will be realised .
These views and opinions may change .
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Inflation post Covid-19: to be or not to be?
Getty Images
We spoke to two experts who argued the case for and against inflation in the near future and what it means for investments.
Abdallah Guezour, Head of Emerging Market Debt and Commodities, and Keith Wade, Chief Economist, discuss the outlook for inflation in the midst of the Covid-19 crisis.
Abdallah argues the case for inflation and explains why we could see inflation between 4-6% in the next five years.
Keith argues the case against inflation, seeing the lingering impact of Covid-19 keeping a lid on demand and potentially causing a deflationary shock.
Both scenarios could have a major investment implications. They discuss the potential winners and losers.
The case FOR inflation (Abdallah Guezour):
What is the likelihood we will a rise in inflation n the next two or three years?
The probability of inflation returning in the next two to three years has increased significantly for three main reasons.
Firstly, the current aggressive global monetary and fiscal easing is unprecedented and is likely to create inflationary pressures sooner rather than later. Money printing by central banks is sky-rocketing, leading to a record surge in money supply globally.
Secondly, the supply shocks from the US-China trade war last year have now been exacerbated by Covid-19 lockdowns – meaning less globalisation or even deglobalisation – which is likely to be inflationary.
Thirdly, after a protracted bear market in commodities, and a collapse in oil prices, significant supply destruction is underway. Any signs of normalisation in demand would increase commodity prices from their current historically depressed levels.
Where could inflation appear first?
Inflation could appear first in countries with currencies which have seen a severe devaluation such as certain emerging market (EM) countries.
An inflation scare could also start in the US. Broad US dollar strength in recent years has been deflationary. The US dollar has been supported by a favourable interest rate and growth differential – both are now disappearing.
The Fed is aggressively monetising the US fiscal deficit. The US “twin deficit” (both fiscal and current account) is on course to reach 20% of GDP this year. Dollar weakness would be inflationary for the US and globally.
How does QE during Covid-19 crisis differ from that seen during the GFC?
Current Quantitative Easing (QE) – where central banks purchase longer-term securities, such as bonds, to increase the money supply and encourage lending and investment – differs from QE seen after the Global Financial Crisis (GFC).
Then, the money printed by central banks did not reach the real economy because it was used to stabilise a financial system on the brink of collapse.
Monetary policy transmission mechanism was broken at that time and most the money printed in the aftermath of the GFC ended in excess reserves of US commercial banks and has also inflated asset prices.
This time, QE appears to be reaching the real economy – current money printing is directly financing government spending and supporting bank lending, as illustrated by the ongoing surge in commercial and industrial loans in the US. Such a surge was not seen during the GFC.
The current QE also appears to be open-ended and has become broad-based. A number of emerging markets are even now turning to some forms of QE. All these policies will soon become inflationary.
What level could inflation reach?
Global GDP-weighted Consumer Price Inflation has been 2-4% range and could initially move to 4-6% in the next three years. The initial recovery in inflation will actually be positive for the global growth recovery.
However, central banks and governments will not normalise monetary and fiscal policies prematurely. They will, however, need to do so eventually, as and when markets react to an inflation scare and / or fiscal crisis because of the massive build-up in fiscal deficits globally.
The case AGAINST inflation ( Keith Wade):
Why might we not see inflation rise?
The current shock is actually extremely deflationary. Demand is collapsing as a result of the lockdowns, causing prices to come down rather than go up.
The most extreme example of this is in the oil industry where demand has dropped by around a third and the oil price has collapsed. Recent worldwide inflation data has been very low, with a record drop in US core inflation and a sharp drop in the headline rate.
Lack of demand forces companies have to discount their products – in many cases, they cannot sell them at all. As the economy begins to open up, things will improve but we think companies will still discount quite aggressively so, near term, inflation will be low.
To model inflation, we look at the spare capacity in the economy – the output gap – and the shutdown due to Covid-19 has generated a lot of this.
US unemployment has increased to nearly 15% and could increase further. In the UK, two million people have registered for benefits and we see it all across Europe too.
As these economies recover, people will get back to work but the very gradual lifting of the lockdown means the recovery will be gradual too.
We do not see the quick snap back that people had hoped for when the crisis started.
We believe spare capacity will persist and act as a downward pressure on inflation until 2021 and even into 2022.
As the eurozone and Japan, in particular, had low inflation even before the crisis, we could well see periods of deflation there. I feel deflation is a greater risk than inflation at present.
For more:
– Q&A: Will Covid-19 mark a permanent economic shift?
– Slumping economy, surging stock market– what’s going on?
– Infographic: A snapshot of the world economy in May 2020
What are the side effects of a lack of inflation and even deflation?
Japan has spent much of the last decade trying to stimulate its economy and get out of deflation, which indicates how difficult it is to create inflation.
It requires a sustained increase in money supply to get inflation to come through.
At present, the increase in the money supply reflects borrowing by companies that are short of cash and trying to survive.
This is not companies borrowing to spend or invest, which would be inflationary. In this scenario deflation becomes an issue.
With a big increase in borrowing, if there is deflation, then the real burden of that debt increases, which weighs negatively on economic activity.
Can the economy recover without inflation?
Economic activity, in the long run, is driven by structural forces and shifts in demographics such as innovation and technology, rather than inflation.
For instance, spending on healthcare will probably increase as a result of this crisis. We will see greater innovation, technology and more recruitment which will be a source of growth. This is already being driven by the increased demand from an ageing population.
As result of the lockdown, remote working technology, conference calls, remote shopping, etc., will all see further growth.
That is the classic process of economic activity – creative destruction created by different events – meaning some jobs are lost but the economy reshuffles and moves resources to the areas where there is growth.
It is, however, very difficult to anticipate where demand will come from.
Investment implications:
In an inflationary world, which assets, sectors or regions are likely to benefit? (Abdallah Guezour)
History shows us that gold tends to perform well during periods of higher inflation. Currencies of commodity-exporting nations, various commodity sectors and resources equities should perform reasonably well too.
Emerging market high-yielding bonds and equities especially in those countries that could benefit from stronger commodity prices, could also be supported by the possible return of inflation.
Even a small rise in global demand could lead to a surge in some of those commodities because they are trading at very depressed levels and they are generally under-owned by investors.
Government bonds might be the biggest risk because yields are negative in certain developed countries or very low, with very limited return upside potential.
Even if we see a protracted economic slowdown, the performance from these bonds is likely to disappointing in the next few years.
Without inflation, which assets sectors and regions could benefit? (Keith Wade)
In a world of low inflation or deflation, you would want to hold fixed interest, government bonds in particular, i.e. safe assets. However, their yields are low so they are discounting a weak economic environment.
More broadly, in credit markets, some investment grade (low risk) and high yield bonds are of interest.
The focus should be on finding companies which are resilient and can perform well in this kind of environment. Areas of growth include the technology, healthcare and biotech sectors.
A lot of companies will look to make supply chains more resilient. For instance, by building more robotics, bringing in artificial intelligence and using fewer people. In other words, bringing production back home in what is called the fourth industrial revolution.
Another general theme as well is climate change. Though this is quite different from the Covid issue, you are seeking areas of growth and expenditure that will be sustained though quite a deflationary environment. Climate change should see quite a lot of investment. Finding themes is key and quality companies positioned in the right place to benefit from that investment.
These innovations might restrict some of the trade within emerging markets which still depend very much on global trade. Generally I think that it is about searching for companies with more of a micro approach rather than taking a regional or geographical approach to this question.
You can discover more at Schroders insights and follow Schroders on twitter.
Important Information: This communication is marketing material. The views and opinions contained herein are those of the author(s) on this page, and may not necessarily represent views expressed or reflected in other Schroders communications, strategies or funds. This material is intended to be for information purposes only and is not intended as promotional material in any respect. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. It is not intended to provide and should not be relied on for accounting, legal or tax advice, or investment recommendations. Reliance should not be placed on the views and information in this document when taking individual investment and/or strategic decisions. Past performance is not a reliable indicator of future results. The value of an investment can go down as well as up and is not guaranteed. All investments involve risks including the risk of possible loss of principal. Information herein is believed to be reliable but Schroders does not warrant its completeness or accuracy. Some information quoted was obtained from external sources we consider to be reliable. No responsibility can be accepted for errors of fact obtained from third parties, and this data may change with market conditions. This does not exclude any duty or liability that Schroders has to its customers under any regulatory system. Regions/ sectors shown for illustrative purposes only and should not be viewed as a recommendation to buy/sell. The opinions in this material include some forecasted views. We believe we are basing our expectations and beliefs on reasonable assumptions within the bounds of what we currently know. However, there is no guarantee than any forecasts or opinions will be realised. These views and opinions may change. To the extent that you are in North America, this content is issued by Schroder Investment Management North America Inc., an indirect wholly owned subsidiary of Schroders plc and SEC registered adviser providing asset management products and services to clients in the US and Canada. For all other users, this content is issued by Schroder Investment Management Limited, 1 London Wall Place, London EC2Y 5AU. Registered No. 1893220 England. Authorised and regulated by the Financial Conduct Authority.


cityam--2020-05-26--FRC probes KPMG and PwC's Eddie Stobart audits

The accounting watchdog has opened investigations into audits by KPMG and PwC of haulage firm Eddie Stobart Logistics .
In August , Eddie Stobart sacked its chief executive and suspended trading in its shares after an accounting investigation found its 2018 profits had been overstated by £2m .
Read more : Eddie Stobart shares open 93 per cent down following suspension A review of the company ’ s accounts , undertaken by finance chief Anoop King , found that 2018 operating profits had been overstated by around four per cent .
The logistics firm nearly fell into administration before striking @ @ @ @ @ @ @ Capital Fund in December .
The deal left Dbay with a 49 per cent increase in Eddie Stobart .
In a statement to the stock market , Eddie Stobart had said shareholders had voted “ overwhelmingly ” in favour of the bailout .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
In a statement , the Financial Reporting Council ( FRC ) said it had “ commenced two investigations into the audits of Eddie Stobart Logistics plc for the years @ @ @ @ @ @ @ and 30 November 2018 ( PwC ) .
” The investigation will be conducted by the FRC ’ s enforcement division under the Audit Enforcement Procedure .
It is not the first time the Big Four have come under scrutiny by regulators .
Earlier this year , the Serious Fraud Office ( SFO ) was reportedly examining allegations that Lloyds and KPMG drove property group , the Angel Group , into administration by saddling it with fees .
KPMG rejected the allegations at the time and said they consider them to be “ @ @ @ @ @ @ @ Stobart Logistics , known for its green and red trucks , took a £169m charge in its half-year results published in February .
Shares in the haulage firm rose 3.03 per cent this morning .
Get the news as it happens by following City A.M. on Twitter .

FRC probes KPMG and PwC’s Eddie Stobart audits
The accounting watchdog has opened investigations into audits by KPMG and PwC of haulage firm Eddie Stobart Logistics.
In August, Eddie Stobart sacked its chief executive and suspended trading in its shares after an accounting investigation found its 2018 profits had been overstated by £2m.
A review of the company’s accounts, undertaken by finance chief Anoop King, found that 2018 operating profits had been overstated by around four per cent.
The logistics firm nearly fell into administration before striking a rescue package with shareholder Douglas Bay Capital Fund in December. The deal left Dbay with a 49 per cent increase in Eddie Stobart.
In a statement to the stock market, Eddie Stobart had said shareholders had voted “overwhelmingly” in favour of the bailout.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
In a statement, the Financial Reporting Council (FRC) said it had “commenced two investigations into the audits of Eddie Stobart Logistics plc for the years ended 30 November 2017 (KPMG) and 30 November 2018 (PwC).”
The investigation will be conducted by the FRC’s enforcement division under the Audit Enforcement Procedure.
It is not the first time the Big Four have come under scrutiny by regulators. Earlier this year, the Serious Fraud Office (SFO) was reportedly examining allegations that Lloyds and KPMG drove property group, the Angel Group, into administration by saddling it with fees.
KPMG rejected the allegations at the time and said they consider them to be “unfounded and without basis”.
Eddie Stobart Logistics, known for its green and red trucks, took a £169m charge in its half-year results published in February.
Shares in the haulage firm rose 3.03 per cent this morning.
Get the news as it happens by following City A.M. on Twitter.


cityam--2020-05-26--Boris Johnson’s approval rating plunges following Dominic Cummings scandal

Prime Minister Boris Johnson ’ s approval rating for his handling of the coronavirus crisis has plunged following the revelations about his chief adviser Dominic Cummings , a poll published today found .
A poll from Savanta found that Johnson ’ s approval rating for his handling of the crisis is now below zero ( minus one per cent ) , having dropped 20 points since the end of last week .
Approval regarding the government ’ s handling of the crisis , once exceedingly high , has also taken a dramatic fall , Savanta said .
Overall government approval @ @ @ @ @ @ @ 16 points in a day , the poll found .
Cummings and his patron Johnson are under severe political pressure after the Mirror and Guardian revealed on Friday that Cummings had driven to Durham from London with his wife who was suffering coronavirus symptoms at the height of the pandemic .
Cummings yesterday denied he had breached government lockdown regulations and said he did not regret his actions .
He has been defended by Johnson and other cabinet heavyweights such as chancellor Rishi Sunak , Cabinet Office minister Michael Gove and Health secretary @ @ @ @ @ @ @ junior minister Douglas Ross , MP for Moray , resigned saying that while he accepted Cummings ’ justification for his trips , this was “ not shared by the vast majority of people who have done as the government asked ” .
Read more : Michael Gove says he has driven to test his eyesight as he defends Dominic Cummings Ross , who also served as under-secretary of state for Scotland , said he had thought “ long and hard ” over the decision .
“ I have constituents who didn ’ t @ @ @ @ @ @ @ ; families who could not mourn together ; people who didn ’ t visit sick relatives because they followed the guidance of the government , ” he wrote in his resignation letter .
“ I can not in good faith tell them they were all wrong and one senior adviser to the government was right .
”

Boris Johnson’s approval rating plunges following Dominic Cummings scandal
Prime Minister Boris Johnson’s approval rating for his handling of the coronavirus crisis has plunged following the revelations about his chief adviser Dominic Cummings, a poll published today found.
A poll from Savanta found that Johnson’s approval rating for his handling of the crisis is now below zero (minus one per cent), having dropped 20 points since the end of last week.
Approval regarding the government’s handling of the crisis, once exceedingly high, has also taken a dramatic fall, Savanta said.
Overall government approval is now at minus two, dropping 16 points in a day, the poll found.
Cummings and his patron Johnson are under severe political pressure after the Mirror and Guardian revealed on Friday that Cummings had driven to Durham from London with his wife who was suffering coronavirus symptoms at the height of the pandemic.
Cummings yesterday denied he had breached government lockdown regulations and said he did not regret his actions.
He has been defended by Johnson and other cabinet heavyweights such as chancellor Rishi Sunak, Cabinet Office minister Michael Gove and Health secretary Matt Hancock.
However, this morning junior minister Douglas Ross, MP for Moray, resigned saying that while he accepted Cummings’ justification for his trips, this was “not shared by the vast majority of people who have done as the government asked”.
Ross, who also served as under-secretary of state for Scotland, said he had thought “long and hard” over the decision.
“I have constituents who didn’t get to say goodbye to loved ones; families who could not mourn together; people who didn’t visit sick relatives because they followed the guidance of the government,” he wrote in his resignation letter.
“I cannot in good faith tell them they were all wrong and one senior adviser to the government was right.”


cityam--2020-05-26--Central London office take-up plummets as employees work from home

The amount of central London office space leased in the first quarter of the year plunged as employees began working from home and the UK entered its coronavirus lockdown .
Office space leased in the capital between January and March reached 2.7m sq ft , down 30 per cent on the previous quarter .
Read more : Office Politics : What does the workplace of the future look like ?
The government introduced a full lockdown in the UK on 23 March , although many firms had advised employees to work from home before the restrictions were announced .
“ @ @ @ @ @ @ @ real estate market as the UK entered full pandemic lockdown .
Social distancing measures restricted travel , closed workplaces , and for many millions , homes have become the new office , ” the latest report by commercial property consultancy Devono Cresa said .
Meanwhile , separate research published yesterday by CBRE found that central London office take-up fell 66 per cent to 225,800 in April compared to 2019 , representing the first full month of the UK lockdown .
Read more : The office is changing – and that means a shift @ @ @ @ @ @ @ The legal sector was the most active in the London commercial property market in the first quarter , accounting for 16 per cent of transactions compared to five per cent in the fourth quarter of 2019 , Devono Cresa said .
The surge in office take up within the legal industry can be largely attributed to Linklaters ’ pre-let in February on 310,000 sq ft at 20 Ropemaker Street .

Central London office take-up plummets as employees work from home
The amount of central London office space leased in the first quarter of the year plunged as employees began working from home and the UK entered its coronavirus lockdown.
Office space leased in the capital between January and March reached 2.7m sq ft, down 30 per cent on the previous quarter.
The government introduced a full lockdown in the UK on 23 March, although many firms had advised employees to work from home before the restrictions were announced.
“The first quarter ended abruptly for the real estate market as the UK entered full pandemic lockdown. Social distancing measures restricted travel, closed workplaces, and for many millions, homes have become the new office,” the latest report by commercial property consultancy Devono Cresa said.
Meanwhile, separate research published yesterday by CBRE found that central London office take-up fell 66 per cent to 225,800 in April compared to 2019, representing the first full month of the UK lockdown.
The legal sector was the most active in the London commercial property market in the first quarter, accounting for 16 per cent of transactions compared to five per cent in the fourth quarter of 2019, Devono Cresa said.
The surge in office take up within the legal industry can be largely attributed to Linklaters’ pre-let in February on 310,000 sq ft at 20 Ropemaker Street.


cityam--2020-05-26--EDF submits planning application for Sizewell C nuclear power station

EDF has this morning submitted an application to build the new Sizewell C nuclear power plant on the Suffolk coast to the Planning Inspectorate .
The plant , which the French firm is developing in partnership with China ’ s state-owned nuclear company CGN , will be a near replica of Hinkley Point C in Somerset .
Read more : Coronavirus : EDF to furlough Hinkley Point workers after reducing site numbers Upon completion , the power station is expected to supply energy to around 6m homes in the east of England , and will employ 900 people .
During @ @ @ @ @ @ @ create 25,000 job opportunities as well as 1,000 apprenticeships .
Over the course of its lifetime , the power station is expected to contribute £4bn to the region ’ s economy .
John Dugmore , chief executive of the Suffolk Chamber of Commerce , said that the county ’ s business community was “ very supportive ” of the project : “ Sizewell C is a huge opportunity for Suffolk companies from all sectors and we are working hard through the Sizewell C supply chain portal to make sure they reap the benefits @ @ @ @ @ @ @ model , it is hoped that the project will be 20 per cent cheaper than its predecessor , which is expected to cost up to £22.5bn .
The application process is expected to take about 18 months to complete , with the government to have the final say on whether the project will go ahead .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
If it is approved , EDF say that it will take roughly a decade to build @ @ @ @ @ @ @ process is unlikely to be without challenge , with certain stakeholders already voicing their concerns over the project .
The Stop Sizewell C campaign group has hit out at the project ’ s developers for “ riding roughshod ” over the coronavirus lockdown restrictions , claiming local residents will not be able to participate fully in the planning process .
Alison Downes , a spokesperson for the group , said : “ With restrictions set to last many months there can not be full public participation in the planning process – even the @ @ @ @ @ @ @ it could work ” EDF said that the application had been delayed for two months in light of the coronavirus situation and that extra measures would be put in place to make it easier for local residents to scrutinise the plans once they have been published .
The group has also pointed to the fact that the new project ’ s predecessor Sizewell B has been running at 50 per cent capacity during the current crisis due to the lack of energy demand as evidence for the inflexible nature of nuclear energy .
@ @ @ @ @ @ @ attract the attention of those currently urging the government to reduce the role of Chinese firms in the UK ’ s critical national infrastructure .
As with telecoms giant Huawei , which prime minister Boris Johnson is reportedly planning to phase out of the UK ’ s 5G networks by 2023 , CGN is blacklisted in the US over accusations of stealing nuclear secrets .
According to the Financial Times , Johnson has asked officials to draw up plans as to how to reduce Chinese investment in the UK .

EDF submits planning application for Sizewell C nuclear power station
Sizewell B power station in Suffolk, where the new power plant will be built.
EDF has this morning submitted an application to build the new Sizewell C nuclear power plant on the Suffolk coast to the Planning Inspectorate.
The plant, which the French firm is developing in partnership with China’s state-owned nuclear company CGN, will be a near replica of Hinkley Point C in Somerset.
Upon completion, the power station is expected to supply energy to around 6m homes in the east of England, and will employ 900 people.
During the construction phase, the project will create 25,000 job opportunities as well as 1,000 apprenticeships.
Over the course of its lifetime, the power station is expected to contribute £4bn to the region’s economy.
John Dugmore, chief executive of the Suffolk Chamber of Commerce, said that the county’s business community was “very supportive” of the project:
“Sizewell C is a huge opportunity for Suffolk companies from all sectors and we are working
hard through the Sizewell C supply chain portal to make sure they reap the benefits. The
By copying the Hinkley Point model, it is hoped that the project will be 20 per cent cheaper than its predecessor, which is expected to cost up to £22.5bn.
The application process is expected to take about 18 months to complete, with the government to have the final say on whether the project will go ahead.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
If it is approved, EDF say that it will take roughly a decade to build the power station.
However, the process is unlikely to be without challenge, with certain stakeholders already voicing their concerns over the project.
The Stop Sizewell C campaign group has hit out at the project’s developers for “riding roughshod” over the coronavirus lockdown restrictions, claiming local residents will not be able to participate fully in the planning process.
Alison Downes, a spokesperson for the group, said: “With restrictions set to last many months there cannot be full public participation in the planning process – even the Planning Inspectorate does not yet know how it could work”
EDF said that the application had been delayed for two months in light of the coronavirus situation and that extra measures would be put in place to make it easier for local residents to scrutinise the plans once they have been published.
The group has also pointed to the fact that the new project’s predecessor Sizewell B has been running at 50 per cent capacity during the current crisis due to the lack of energy demand as evidence for the inflexible nature of nuclear energy.
The power station is also likely to attract the attention of those currently urging the government to reduce the role of Chinese firms in the UK’s critical national infrastructure.
As with telecoms giant Huawei, which prime minister Boris Johnson is reportedly planning to phase out of the UK’s 5G networks by 2023, CGN is blacklisted in the US over accusations of stealing nuclear secrets.
According to the Financial Times, Johnson has asked officials to draw up plans as to how to reduce Chinese investment in the UK.


cityam--2020-05-26--House buyer demand surges after government lifts property market restrictions

Demand from potential house buyers spiked 88 per cent after lockdown restrictions on England ’ s property market eased earlier this month , according to the latest research .
However , the pent-up demand varied between cities , according to the latest research by Zoopla , and the rebound in London has been less pronounced than other English cities .
Read more : Housing transactions collapse in April as lockdown hits UK property market The research found that some potential buyers could be looking to move to commuter towns outside of the capital after working from home during the coronavirus @ @ @ @ @ @ @ housing could have slowed down the bounce back in London .
Demand has bounced back strongly in northern England and cities along the south coast since the government gave the go-ahead for the housing market to reopen .
The surge in demand is expected to be temporary and slow in the coming weeks .
The Zoopla Cities Index found that 60 per cent of potential homemovers across Britain were planning to go ahead with their plans , however 40 per cent had put potential moves on hold due to the pandemic .
Meanwhile @ @ @ @ @ @ @ 12 per cent since the market reopened two weeks ago .
Zoopla director of research and insight Richard Donnell said : “ The scale of rebound in demand for housing is welcome news for estate agents and developers , but it is also surprising given projections for a sharp rise in unemployment and a major decline in economic growth .
“ The Covid crisis and 50 day lockdown have created an unexpected one-off boost to housing demand .
Millions of UK households have spent a considerable amount of time in their homes over @ @ @ @ @ @ @ hours of committing .
Many households are likely to have re-evaluated what they want from their home .
“ This could well explain the scale of the demand returning to the market.
” However , he added that uncertainty will build as the economic impact of the pandemic becomes clearer over the coming months .
Read more : UK house prices jumped before coronavirus lockdown brought market to standstill “ The majority of would-be movers plan to continue their search , encouraged by low mortgage rates and continued Government support for the economy @ @ @ @ @ @ @ , we expect the latest rebound in demand to moderate in the coming weeks as buyers and sellers start to exert greater caution .
Further support from the Government can ’ t be discounted and would help limit the scale of the downside risks .
”

House buyer demand surges after government lifts property market restrictions
The stamp duty holiday helped boost market activity and house prices
Demand from potential house buyers spiked 88 per cent after lockdown restrictions on England’s property market eased earlier this month, according to the latest research.
However, the pent-up demand varied between cities, according to the latest research by Zoopla, and the rebound in London has been less pronounced than other English cities.
The research found that some potential buyers could be looking to move to commuter towns outside of the capital after working from home during the coronavirus lockdown. It also said affordability of housing could have slowed down the bounce back in London.
Demand has bounced back strongly in northern England and cities along the south coast since the government gave the go-ahead for the housing market to reopen.
The surge in demand is expected to be temporary and slow in the coming weeks.
The Zoopla Cities Index found that 60 per cent of potential homemovers across Britain were planning to go ahead with their plans, however 40 per cent had put potential moves on hold due to the pandemic.
Meanwhile, new sales agreed in England increased 12 per cent since the market reopened two weeks ago.
Zoopla director of research and insight Richard Donnell said: “The scale of rebound in demand for housing is welcome news for estate agents and developers, but it is also surprising given projections for a sharp rise in unemployment and a major decline in economic growth.
“The Covid crisis and 50 day lockdown have created an unexpected one-off boost to housing demand. Millions of UK households have spent a considerable amount of time in their homes over the lockdown period and missed out on hours of committing. Many households are likely to have re-evaluated what they want from their home.
“This could well explain the scale of the demand returning to the market.”
However, he added that uncertainty will build as the economic impact of the pandemic becomes clearer over the coming months.
“The majority of would-be movers plan to continue their search, encouraged by low mortgage rates and continued Government support for the economy,” Donnell added.
“However, we expect the latest rebound in demand to moderate in the coming weeks as buyers and sellers start to exert greater caution. Further support from the Government can’t be discounted and would help limit the scale of the downside risks.”


cityam--2020-05-26--Pharma giant Merck enter coronavirus vaccine race with three treatments

US pharmaceuticals giant Merck has thrown itself into the race to develop a vaccine for the coronavirus disease with the purchase of Austrian vaccine maker Themis .
The Themis vaccine , which is being developed in partnership with the Pasteur Institute in Paris , is based on a modified measles vaccine .
Doses are already being produced for clinical trials .
In addition to the acquisition , Merck also announced a partnership with the non-profit International Aids Vaccine Initiative ( IAVI ) to develop a separate vaccine .
This second treatment is based on one of Merck ’ s already @ @ @ @ @ @ @ to begin human trials later this year .
Rounding out its expansion into the hunt for treatments for the new disease , the New Jersey headquartered firm also announced another partnership with Ridgeback Biotherapeutics to make an antiviral treatment for the disease .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
The pill , which is like Gilead Sciences much-heralded Remdesivir drug , is designed to prevent the reproduction of the virus .
The global hunt for a treatment for @ @ @ @ @ @ @ initiatives around the world , with Merck slow off the mark compared to some of its competitors .
Speaking to Reuters , chief executive Ken Frazier said : “ “ We wanted to be in a position where we could choose things that have the right kind of characteristics to make a contribution for a virus that ’ s likely to be with us for some time ” .
Read more : Astrazeneca set to supply potential coronavirus vaccine in September However , he also warned that the 12-18 month timeframe to develop @ @ @ @ @ @ @ ” .
He told the Financial Times : “ Our experience suggests those are very aggressive compared to other timelines for getting a safe and effective vaccine .
”

Pharma giant Merck enter coronavirus vaccine race with three treatments
US pharmaceuticals giant Merck has thrown itself into the race to develop a vaccine for the coronavirus disease with the purchase of Austrian vaccine maker Themis.
The Themis vaccine, which is being developed in partnership with the Pasteur Institute in Paris, is based on a modified measles vaccine.
Doses are already being produced for clinical trials.
In addition to the acquisition, Merck also announced a partnership with the non-profit International Aids Vaccine Initiative (IAVI) to develop a separate vaccine.
This second treatment is based on one of Merck’s already approved Ebola treatments, and is expected to begin human trials later this year.
Rounding out its expansion into the hunt for treatments for the new disease, the New Jersey headquartered firm also announced another partnership with Ridgeback Biotherapeutics to make an antiviral treatment for the disease.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
The pill, which is like Gilead Sciences much-heralded Remdesivir drug, is designed to prevent the reproduction of the virus.
The global hunt for a treatment for the disease has spawned more than 80 initiatives around the world, with Merck slow off the mark compared to some of its competitors.
Speaking to Reuters, chief executive Ken Frazier said: ““We wanted to be in a position where we could choose things that have the right kind of characteristics to make a contribution for a virus that’s likely to be with us for some time”.
However, he also warned that the 12-18 month timeframe to develop an effective vaccine was “very aggressive”.
He told the Financial Times: “Our experience suggests those are very aggressive compared to other timelines for getting a safe and effective vaccine.”


cityam--2020-05-26--Renault to cut 5,000 jobs by 2024 - report

French automotive giant Renault is set to announce plans to cut up to 5,000 jobs over the next five years in a cost-saving drive , local media reported .
The company , which is still in the process of securing a €5bn state loan in order to bolster its coronavirus-stricken finances , is looking to save €2bn in costs .
According to Le Figaro , the carmaker will prioritise those workers planning on retiring for the job cuts , rather than direct lay-offs .
In the first quarter , revenue at Renault fell by a quarter as car sales slumped @ @ @ @ @ @ @ it was announced that the firm had reached a deal over a long-sought rescue package with its banks , but the agreement is still set to be rubber-stamped by the French finance ministry .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
Speaking today , French president Emmanuel Macron said the loan would not be signed off until the carmaker had completed talks with its unions over its workforce and factories .
Earlier this week Reuters had reported that the @ @ @ @ @ @ @ closures as part of its cost-cutting plans .
Macron also announced an €8bn plan to make France the top producer of clean vehicles in Europe and urged French carmakers to make vehicles in their own country .
Read more : Renault sees revenue drop a fifth due to coronavirus Renault is also expected to provide an update later this week regarding its alliance with Japanese car giant Nissan .
The partnership has been strained in recent years due to the fallout over the arrest of former Nissan executive Carlos Ghosn .

Renault to cut 5,000 jobs by 2024 – report
French automotive giant Renault is set to announce plans to cut up to 5,000 jobs over the next five years in a cost-saving drive, local media reported.
The company, which is still in the process of securing a €5bn state loan in order to bolster its coronavirus-stricken finances, is looking to save €2bn in costs.
According to Le Figaro, the carmaker will prioritise those workers planning on retiring for the job cuts, rather than direct lay-offs.
In the first quarter, revenue at Renault fell by a quarter as car sales slumped due to the pandemic.
Last week it was announced that the firm had reached a deal over a long-sought rescue package with its banks, but the agreement is still set to be rubber-stamped by the French finance ministry.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
Speaking today, French president Emmanuel Macron said the loan would not be signed off until the carmaker had completed talks with its unions over its workforce and factories.
Earlier this week Reuters had reported that the carmaker could announce job cuts and factory closures as part of its cost-cutting plans.
Macron also announced an €8bn plan to make France the top producer of clean vehicles in Europe and urged French carmakers to make vehicles in their own country.
Renault is also expected to provide an update later this week regarding its alliance with Japanese car giant Nissan.
The partnership has been strained in recent years due to the fallout over the arrest of former Nissan executive Carlos Ghosn.


cityam--2020-05-26--Warner Music Group resumes $1.8bn IPO after coroanvirus

Ed Sheeran ’ s record label Warner Music Group ( WMG ) is seeking to raise $ 1.8bn ( £1.5bn ) as it restarts its initial public offering ( IPO ) process after it was interrupted by the coronavirus pandemic .
In a statement , WMG today said it would seek to sell 70m shares – 14 per cent of the company – at a targeted price of $ 23 to $ 26 .
This would give the company a valuation of between $ 11.7bn and $ 13.3bn , almost four times what billionaire Len Blavatnik paid for it in @ @ @ @ @ @ @ New York ’ s Nasdaq bourse .
The group , which also represents artists like Lizzo and Bruno Mars , was due to list in March , but suspended plans due to the spread of the disease .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
Its announcement that it was now ready to go ahead with the sale makes it one of the first firms to debut in what will be a key test of the market ’ s @ @ @ @ @ @ @ Suisse , and Goldman Sachs are acting as joint bookrunners for the sale , which is expected on 2 June .
The offering will consist entirely of secondary shares to be sold by Access Industries , LLC and other selling stockholders .
Read more : McLaren to cut 1,200 jobs as coronavirus forces group restructuring WMG posted a loss of $ 74m in its results for the last quarter , swinging from a profit of $ 67m in the same period the year before .
Although the recorded music industry is expected to @ @ @ @ @ @ @ sectors , the firm has warned that the pandemic has damaged physical sales and the release of new recordings and films .

Warner Music Group resumes $1.8bn IPO after coroanvirus
Ed Sheeran is represented by Warner Music Group.
Ed Sheeran’s record label Warner Music Group (WMG) is seeking to raise $1.8bn (£1.5bn) as it restarts its initial public offering (IPO) process after it was interrupted by the coronavirus pandemic.
In a statement, WMG today said it would seek to sell 70m shares – 14 per cent of the company – at a targeted price of $23 to $26.
This would give the company a valuation of between $11.7bn and $13.3bn, almost four times what billionaire Len Blavatnik paid for it in 2011.
The firm will list on New York’s Nasdaq bourse.
The group, which also represents artists like Lizzo and Bruno Mars, was due to list in March, but suspended plans due to the spread of the disease.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
Its announcement that it was now ready to go ahead with the sale makes it one of the first firms to debut in what will be a key test of the market’s post-coronavirus appetite.
Morgan Stanley, Credit Suisse, and Goldman Sachs are acting as joint bookrunners for the sale, which is expected on 2 June.
The offering will consist entirely of secondary shares to be sold by Access Industries, LLC and other selling stockholders.
WMG posted a loss of $74m in its results for the last quarter, swinging from a profit of $67m in the same period the year before.
Although the recorded music industry is expected to more resilient to the crisis than many sectors, the firm has warned that the pandemic has damaged physical sales and the release of new recordings and films.


cityam--2020-05-26--Michael O'Leary slams 'illegal' Lufthansa state bailout

Ryanair ’ s chief executive Michael O ’ Leary has this afternoon challenged German carrier Lufthansa ’ s €9bn state bailout , labelling the rescue package ‘ illegal ’ .
In a statement , the low-cost airline ’ s boss said that the aid would enable Lufthansa to engage in below-cost selling which would “ massively distort competition ” .
He said : “ Ryanair will appeal [ to the European Commission ] against this latest example of illegal state aid to Lufthansa , which will massively distort competition ” .
O ’ Leary ’ s comments come after the @ @ @ @ @ @ @ bailout deal , which will see authorities take a 20 per cent stake in the airline .
Finance minister Olaf Scholze said that the state intended to sell the stake as soon as the company was fit again , estimating a date of 2023 .
The deal , which will see the government buy roughly €300m worth of shares , requires Lufthansa to waive future dividends payments and place limits of executive pay .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus @ @ @ @ @ @ @ burning cash at a rate of €1m an hour , is hoping for a swift approval from the Commission .
Throughout the coronavirus crisis , which has battered airlines around the world , O ’ Leary has been a staunch opponent of state aid for airlines , saying that it was inevitable the pandemic would drive some carriers out of business .
Last month the carrier threatened to appeal to the Commission over Air France ’ s €7bn bailout from the French government .
The Lufthansa deal means that around the world , @ @ @ @ @ @ @ in financial assistance from governments .
Read more : Ryanair cuts 2021 traffic target again over coronavirus , but boosts profit However , global industry body IATA ’ s chief executive Alexandre de Juniac today warned governments that giving financial aid in a form that will lead to debt – such as loans – will make recovery “ longer and more difficult ” .
De Juniac ’ s words came as LATAM , South America ’ s largest carrier , filed for bankruptcy today , the biggest airline in the world to do @ @ @ @

Michael O’Leary slams ‘illegal’ Lufthansa state bailout
Ryanair’s chief executive Michael O’Leary has this afternoon challenged German carrier Lufthansa’s €9bn state bailout, labelling the rescue package ‘illegal’.
In a statement, the low-cost airline’s boss said that the aid would enable Lufthansa to engage in below-cost selling which would “massively distort competition”.
He said: “Ryanair will appeal [to the European Commission] against this latest example of illegal state aid to Lufthansa, which will massively distort competition”.
O’Leary’s comments come after the German flag carrier finally secured its long-touted bailout deal, which will see authorities take a 20 per cent stake in the airline.
Finance minister Olaf Scholze said that the state intended to sell the stake as soon as the company was fit again, estimating a date of 2023.
The deal, which will see the government buy roughly €300m worth of shares, requires Lufthansa to waive future dividends payments and place limits of executive pay.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
The airline, which is burning cash at a rate of €1m an hour, is hoping for a swift approval from the Commission.
Throughout the coronavirus crisis, which has battered airlines around the world, O’Leary has been a staunch opponent of state aid for airlines, saying that it was inevitable the pandemic would drive some carriers out of business.
Last month the carrier threatened to appeal to the Commission over Air France’s €7bn bailout from the French government.
The Lufthansa deal means that around the world, airlines have now received over $120bn in financial assistance from governments.
However, global industry body IATA’s chief executive Alexandre de Juniac today warned governments that giving financial aid in a form that will lead to debt – such as loans – will make recovery “longer and more difficult”.
De Juniac’s words came as LATAM, South America’s largest carrier, filed for bankruptcy today, the biggest airline in the world to do so thus far.


cityam--2020-05-26--FTSE 100 rises as retail sector prepares to reopen

The UK ’ s FTSE 100 closed higher after investors welcomed Boris Johnson ’ s plans for the phased reopening of the retail sector .
London ’ s blue-chip index closed 1.28 per cent at 6,069 points , as the retail sector prepared to re-open in mid-June .
Read more : Boris Johnson sets out plans for shops and markets to reopen In the Downing Street briefing last night , the Prime Minister said there will be a formal assessment of easing the lockdown restrictions on Thursday as part of the legal review .
However , he revealed plans to @ @ @ @ @ @ @ open from 1 June .
He added that he intends to allow all other non-essential retail , including department stores and independent shops , too reopen from 15 June .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
European markets also opened higher as investors welcomed another positive economic reading out of Europe .
Germany ’ s Dax jumped nearly three per cent before closing up 1.21 per cent , after the German GFK consumer climate data beat its forecast @ @ @ @ @ @ @ day 1.71 per cent higher .
Overnight , the Nikkei led gains in Asia , hitting a ten-week high , as Asian stocks jumped on optimism over the loosening of lockdowns around the world .
Investors were buoyed by news that American biotech firm Novavax had started the first human study of its experimental coronavirus vaccine .
The company said it expects initial results on responses in July .
It comes on the back of biotech company Moderna ’ s recent report of a positive development in its vaccine trial .
Russ Mould @ @ @ @ @ @ @ said : “ Whether this relief rally can last will depend on whether the easing of containment measures can be achieved without a second spike in coronavirus infections , and until then further volatility in these sectors can not be ruled out.
” Travel stocks performed well on the back of a combination of the planned reopening of European holiday destinations and the German government ’ s bailout for Lufthansa .
Tui was the FTSE 100 ’ s biggest riser , as shares surged more than 50 per cent after the Spanish government @ @ @ @ @ @ @ in safe conditions ” .
Chief executive Fritz Joussen welcomed the news and said the July return of Spanish tourism is a “ good signal ” .
British Airways owner IAG closed up 22.5 per cent , while Easyjet rose more than 19.63 per cent following reports that the German government had agreed a bailout plan with Lufthansa .
Neil Wilson , chief market analyst at Markets.com , said : “ Strength in this sector underscores confidence among investors that economies are reopening , and consumers are keen to travel.
” “ There @ @ @ @ @ @ @ restrictions across Europe will be eased in time for the summer holidays .
If the summer holiday season can be saved it would be a big plus after most of us wrote it off .
“ Additionally , automotive stocks were buoyed by news car showrooms can open from Monday .
Shares in automotive retailer Pendragon jumped 11.9 per cent in early trading , followed by car dealership chain Lookers , which rose nearly nine per cent .
Aston Martin shares surged 30 per cent after it confirmed it had parted with chief @ @ @ @ @ @ @ Tobias Moers will replace Palmer in August .
Wilson said : “ Aston Martin has been one of the worst stock listings in living memory .
In spite of rocketing higher today they are still worth a tenth of the IPO price – listing at about £5.50 today they are worth 45p.
” Joshua Mahony , senior market analyst at IG , said : “ The outperformance of those within the travel and tourism space highlights the influence the impending lockdown easing is having upon market sentiment.
” “ To some extent it @ @ @ @ @ @ @ their head , with risk-on sentiment driving those riskier and heavily sold stocks such as IAG , Carnival , and Rolls-Royce into huge double digit gains.
” Get the news as it happens by following City A.M. on Twitter .

FTSE 100 rises as retail sector prepares to reopen
The UK’s FTSE 100 closed higher after investors welcomed Boris Johnson’s plans for the phased reopening of the retail sector.
London’s blue-chip index closed 1.28 per cent at 6,069 points, as the retail sector prepared to re-open in mid-June.
In the Downing Street briefing last night, the Prime Minister said there will be a formal assessment of easing the lockdown restrictions on Thursday as part of the legal review.
However, he revealed plans to allow outdoor markets and car showrooms to open from 1 June. He added that he intends to allow all other non-essential retail, including department stores and independent shops, too reopen from 15 June.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
European markets also opened higher as investors welcomed another positive economic reading out of Europe. Germany’s Dax jumped nearly three per cent before closing up 1.21 per cent, after the German GFK consumer climate data beat its forecast. France’s Cac ended the day 1.71 per cent higher.
Overnight, the Nikkei led gains in Asia, hitting a ten-week high, as Asian stocks jumped on optimism over the loosening of lockdowns around the world.
Investors were buoyed by news that American biotech firm Novavax had started the first human study of its experimental coronavirus vaccine.
The company said it expects initial results on responses in July. It comes on the back of biotech company Moderna’s recent report of a positive development in its vaccine trial.
Russ Mould, investment director at AJ Bell, said: “Whether this relief rally can last will depend on whether the easing of containment measures can be achieved without a second spike in coronavirus infections, and until then further volatility in these sectors cannot be ruled out.”
Travel stocks lead FTSE 100
Travel stocks performed well on the back of a combination of the planned reopening of European holiday destinations and the German government’s bailout for Lufthansa.
Tui was the FTSE 100’s biggest riser, as shares surged more than 50 per cent after the Spanish government said tourists will be allowed entry “in safe conditions”. Chief executive Fritz Joussen welcomed the news and said the July return of Spanish tourism is a “good signal”.
British Airways owner IAG closed up 22.5 per cent, while Easyjet rose more than 19.63 per cent following reports that the German government had agreed a bailout plan with Lufthansa.
Neil Wilson, chief market analyst at Markets.com, said: “Strength in this sector underscores confidence among investors that economies are reopening, and consumers are keen to travel.”
“There is a lot more hope that travel restrictions across Europe will be eased in time for the summer holidays. If the summer holiday season can be saved it would be a big plus after most of us wrote it off. “
Additionally, automotive stocks were buoyed by news car showrooms can open from Monday. Shares in automotive retailer Pendragon jumped 11.9 per cent in early trading, followed by car dealership chain Lookers, which rose nearly nine per cent.
Aston Martin shares surged 30 per cent after it confirmed it had parted with chief executive Andy Palmer. Senior Mercedes executive Tobias Moers will replace Palmer in August.
Wilson said: “Aston Martin has been one of the worst stock listings in living memory. In spite of rocketing higher today they are still worth a tenth of the IPO price – listing at about £5.50 today they are worth 45p.”
Joshua Mahony, senior market analyst at IG, said: “The outperformance of those within the travel and tourism space highlights the influence the impending lockdown easing is having upon market sentiment.”
“To some extent it feels like we are turning things on their head, with risk-on sentiment driving those riskier and heavily sold stocks such as IAG, Carnival, and Rolls-Royce into huge double digit gains.”
Get the news as it happens by following City A.M. on Twitter.


cityam--2020-05-26--Matt Hancock defends Dominic Cummings as lockdown row continues

Health secretary Matt Hancock this afternoon defended Dominic Cummings despite growing pressure on the government over Boris Johnson ’ s chief aide ’ s decision to drive to Durham despite the lockdown measures .
Speaking at the government ’ s daily press conference , Hancock said that Cummings ’ actions had been “ within the guidelines ” , saying that they allowed for exceptional circumstances such as childcare .
Despite Cummings ’ explanation of his trip yesterday afternoon , the furore over his conduct has continued to grow .
Hancock ’ s remarks came as more than 30 Conservative MPs @ @ @ @ @ @ @ s adviser to resign .
Junior Scotland minister Douglas Ross has also resigned due to the situation , saying that he could not tell angry constituents “ in good faith ” that they were wrong to be angry at the situation .
Cummings is facing calls to resign after a joint investigation by the Mirror and the Guardian revealed he , his wife and young son had travelled to his parents ’ house in Durham in late March , when his wife developed coronavirus symptoms .
Earlier in the day , a poll @ @ @ @ @ @ @ has plunged 20 per cent due to the furore over Cummings ’ conduct .
And a YouGov poll found that 71 per cent of respondents believed that the aide ’ s trips had broken lockdown rules .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
Hancock rejected suggestions that the government ’ s handling of the situation had weakened its coronavirus messaging .
One member of the public asked the health secretary whether the government would review all penalty fines @ @ @ @ @ @ @ during lockdown as a result of the crisis .
He also announced that the NHS will begin a new trial of the antiviral drug Remdesivir as a potential treatment for coronavirus .
According to initial research , the drug , which is used also to treat conditions like Ebola and Mers , can shorten recovery time by four days , Hancock said .
He described the drug as “ the biggest step forward in the treatment of coronavirus since the crisis began ” .
In partnership with manufacturer Gilead Sciences , the NHS @ @ @ @ @ @ @ likely to benefit from the drug .
The health secretary also announced that the government had signed contracts to manufacture 2bn items of PPE in the UK .
Hancock also said that 100 new deals had been signed with contractors around the world to make more supplies , including 3.7bn gloves .
Although he admitted that the UK had “ much further to go ” in terms of ensuring sufficient protective equipment for all health workers , he said that “ significant progress ” had been made .

Matt Hancock defends Dominic Cummings as lockdown row continues
Health Secretary Matt Hancock leaving Downing Street
Health secretary Matt Hancock this afternoon defended Dominic Cummings despite growing pressure on the government over Boris Johnson’s chief aide’s decision to drive to Durham despite the lockdown measures.
Speaking at the government’s daily press conference, Hancock said that Cummings’ actions had been “within the guidelines”, saying that they allowed for exceptional circumstances such as childcare.
Despite Cummings’ explanation of his trip yesterday afternoon, the furore over his conduct has continued to grow.
Hancock’s remarks came as more than 30 Conservative MPs joined calls for the Prime Minister’s adviser to resign.
Junior Scotland minister Douglas Ross has also resigned due to the situation, saying that he could not tell angry constituents “in good faith” that they were wrong to be angry at the situation.
Cummings is facing calls to resign after a joint investigation by the Mirror and the Guardian revealed he, his wife and young son had travelled to his parents’ house in Durham in late March, when his wife developed coronavirus symptoms.
Earlier in the day, a poll showed that Johnson’s approval rating has plunged 20 per cent due to the furore over Cummings’ conduct.
And a YouGov poll found that 71 per cent of respondents believed that the aide’s trips had broken lockdown rules.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
Hancock rejected suggestions that the government’s handling of the situation had weakened its coronavirus messaging.
One member of the public asked the health secretary whether the government would review all penalty fines imposed on families travelling for childcare purposes during lockdown as a result of the crisis.
‘Biggest step forward’ in disease treatment
He also announced that the NHS will begin a new trial of the antiviral drug Remdesivir as a potential treatment for coronavirus.
According to initial research, the drug, which is used also to treat conditions like Ebola and Mers, can shorten recovery time by four days, Hancock said.
He described the drug as “the biggest step forward in the treatment of coronavirus since the crisis began”.
In partnership with manufacturer Gilead Sciences, the NHS will provide the drug to those most likely to benefit from the drug.
The health secretary also announced that the government had signed contracts to manufacture 2bn items of PPE in the UK.
Hancock also said that 100 new deals had been signed with contractors around the world to make more supplies, including 3.7bn gloves.
Although he admitted that the UK had “much further to go” in terms of ensuring sufficient protective equipment for all health workers, he said that “significant progress” had been made.


cityam--2020-05-26--IATA chief: Don't politicise quarantine measures

The chief executive of global aviation body the International Air Transport Association ( IATA ) has warned governments not to use quarantine measures for political purposes .
Over the Bank Holiday weekend , French authorities announced that all Uk visitors to the country would have to quarantine for 14 days in response to the UK ’ s decision to apply blanket restrictions to all incoming travellers .
Read more : UK arrivals face £1,000 fine if they break two-week quarantine rule Previously , the UK government had suggested that there could be an exemption for passengers from France , but @ @ @ @ @ @ @ a news conference this afternoon , Alexandre de Juniac said that the “ politicisation ” of such measures was a “ particular concern ” : “ In response to the UK government ’ s announced 14-day quarantine measures for all arrivals , France announced that it would do the same for arrivals from the UK .
“ Measures must be guided by science , not politics .
And tit-for-tat quarantine measures are , frankly , unacceptable ” , he finished .
Last week home secretary Priti Patel confirmed that the restrictions would be @ @ @ @ @ @ @ that was met with widespread censure in the UK business community .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
Airlines and travel firms have already been among the hardest hit by the virus , and there are fears that the measures will present a severe impediment to their recovery .
Adam Tyndall , programme director at London First , branded the move an “ indiscriminate response to an increasingly nuanced situation ” .
“ The UK is a world @ @ @ @ @ @ @ international agreements between low-risk countries , ” he said .
“ Getting back to some limited and controlled form of air travel will be critical to supporting the UK economy.
” There are still hopes that the UK will sign “ air bridge ” agreements with other countries with a low infection rate in order to allow a degree of travel .
Read more : UK set to introduce £1,000 fines for travel quarantine breaches Downing Street last week admitted such exemptions are under review .
Two sources today told Reuters that Portuguese @ @ @ @ @ @ @ over a possible such arrangement .

IATA chief: Don’t politicise quarantine measures
The chief executive of global aviation body the International Air Transport Association (IATA) has warned governments not to use quarantine measures for political purposes.
Over the Bank Holiday weekend, French authorities announced that all Uk visitors to the country would have to quarantine for 14 days in response to the UK’s decision to apply blanket restrictions to all incoming travellers.
Previously, the UK government had suggested that there could be an exemption for passengers from France, but this was later quashed.
Speaking in a news conference this afternoon, Alexandre de Juniac said that the “politicisation” of such measures was a “particular concern”:
“In response to the UK government’s announced 14-day quarantine measures for all arrivals, France announced that it would do the same for arrivals from the UK.
“Measures must be guided by science, not politics. And tit-for-tat quarantine measures are, frankly, unacceptable”, he finished.
Last week home secretary Priti Patel confirmed that the restrictions would be implemented from 8 June, a decision that was met with widespread censure in the UK business community.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
Airlines and travel firms have already been among the hardest hit by the virus, and there are fears that the measures will present a severe impediment to their recovery.
Adam Tyndall, programme director at London First, branded the move an “indiscriminate response to an increasingly nuanced situation”.
“The UK is a world leader in aviation and should be forging international agreements between low-risk countries,” he said.
“Getting back to some limited and controlled form of air travel will be critical to supporting the UK economy.”
There are still hopes that the UK will sign “air bridge” agreements with other countries with a low infection rate in order to allow a degree of travel.
Downing Street last week admitted such exemptions are under review.
Two sources today told Reuters that Portuguese officials were in negotiations with the UK over a possible such arrangement.


cityam--2020-05-27--Fast fashion retailer Boohoo hit by short-seller attack

Fast fashion retailer Boohoo today denied allegations that it had misled investors following a short-seller attack that saw its share price plunge more than 12 per cent .
In a statement this morning the online retailer said it “ strongly refutes the allegations ” made in a report published yesterday .
“ Boohoo…notes the recent decline in its share price which the group understands is in response to a short-selling note issued on 26 May that contains allegations of disclosing information that could be deemed to be misleading , ” the Aim-listed firm said in a statement this morning .
@ @ @ @ @ @ @ made in the research note ” .
The retailer ’ s share price is down around three per cent this afternoon .
Shadowfall published a 53-page report on Tuesday night alleging that the retailer had provided a “ misleading impression ” of its free cash flow position .
The London hedge fund said Boohoo had overstated its free cash flow by 65 per cent , or £32.2m .
It also said Boohoo classes subsidiary Pretty Little Thing as though it were “ 100 per cent wholly owned ” .
Boohoo has denied all @ @ @ @ @ @ @ cash flow is disclosed in its most recent results with “ clear definitions , alongside a full reconciliation down to net cash flow for the financial year , including items such as tax paid and dividends paid to minority shareholders ” .
It added : “ International accounting standards require the group to fully consolidate its cash flows , and its treatment of this with respect to its subsidiary , Pretty Little Thing reflects this conformance with accounting standards.
” Boohoo raised £198m through a share placing earlier this month as it seeks @ @ @ @ @ @ @ to snap up global brands .
Boohoo said it would use the proceeds to “ take advantage of numerous opportunities that are likely to emerge in the global fashion industry over the coming months ” .

Fast fashion retailer Boohoo hit by short-seller attack
Boohoo has struggled to maintain the momentum post-pandemic as cost of living pressures mount.
Fast fashion retailer Boohoo today denied allegations that it had misled investors following a short-seller attack that saw its share price plunge more than 12 per cent.
In a statement this morning the online retailer said it “strongly refutes the allegations” made in a report published yesterday.
“Boohoo…notes the recent decline in its share price which the group understands is in response to a short-selling note issued on 26 May that contains allegations of disclosing information that could be deemed to be misleading,” the Aim-listed firm said in a statement this morning.
“The Group strongly refutes the allegations made in the research note”.
The retailer’s share price is down around three per cent this afternoon.
Shadowfall published a 53-page report on Tuesday night alleging that the retailer had provided a “misleading impression” of its free cash flow position.
The London hedge fund said Boohoo had overstated its free cash flow by 65 per cent, or £32.2m.
It also said Boohoo classes subsidiary Pretty Little Thing as though it were “100 per cent wholly owned”. Boohoo has denied all the allegations.
The company said free cash flow is disclosed in its most recent results with “clear definitions, alongside a full reconciliation down to net cash flow for the financial year, including items such as tax paid and dividends paid to minority shareholders”.
It added: “International accounting standards require the group to fully consolidate its cash flows, and its treatment of this with respect to its subsidiary, Pretty Little Thing reflects this conformance with accounting standards.”
Boohoo raised £198m through a share placing earlier this month as it seeks to take advantage of the coronavirus crisis to snap up global brands.
Boohoo said it would use the proceeds to “take advantage of numerous opportunities that are likely to emerge in the global fashion industry over the coming months”.


cityam--2020-05-27--Treasury: Furlough scheme now covers 8.4m workers

The number of people covered by the government ’ s job retention furlough scheme has risen to 8.4m , the Treasury revealed today .
Read more : Small businesses borrow £18bn in three weeks under Bounce Back Loan Scheme The new figure marks an increase of 400,000 people on last week ’ s update , with over 1m companies using the scheme .
In addition , the value of such claims has now risen to a total of £15bn , a considerable increase from the previously reported figure of £11.1bn .
With an extra 2.3m self-employed workers also being covered @ @ @ @ @ @ @ is now covering the majority of the wages of well over 10m people .
Under the terms of the furlough scheme , which was introduced to protect jobs in light of the coronavirus pandemic , the Treasury allows employees to receive 80 per cent of their monthly salary up to £2,500 .
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
Later this week , chancellor Rishi Sunak is expected to provide further detail as to how much employers will have @ @ @ @ @ @ @ the coming months .
Earlier in May Sunak announced that the furlough programme would be extended by four months until the end of October , but said companies would have to meet some of the cost from the end of August .
According to the Times , plans are being drawn up to ask firms to cover 20 to 30 per cent of wages .
Yesterday , the FT reported that the chancellor would announce a cut-off date after which companies will not be able to put any more employees onto the scheme @ @ @ @ @ @ @ of ‘ tsunami of job losses ’ once furlough scheme ends This is designed to prevent firms putting full-time employees onto the scheme and bringing them back part-time , which the scheme is expected to be extended to cover .

Treasury: Furlough scheme now covers 8.4m workers
The number of people covered by the government’s job retention furlough scheme has risen to 8.4m, the Treasury revealed today.
The new figure marks an increase of 400,000 people on last week’s update, with over 1m companies using the scheme.
In addition, the value of such claims has now risen to a total of £15bn, a considerable increase from the previously reported figure of £11.1bn.
With an extra 2.3m self-employed workers also being covered for claims of £6.8bn, the state is now covering the majority of the wages of well over 10m people.
Under the terms of the furlough scheme, which was introduced to protect jobs in light of the coronavirus pandemic, the Treasury allows employees to receive 80 per cent of their monthly salary up to £2,500.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
Later this week, chancellor Rishi Sunak is expected to provide further detail as to how much employers will have to pay to support the scheme in the coming months.
Earlier in May Sunak announced that the furlough programme would be extended by four months until the end of October, but said companies would have to meet some of the cost from the end of August.
According to the Times, plans are being drawn up to ask firms to cover 20 to 30 per cent of wages.
Yesterday, the FT reported that the chancellor would announce a cut-off date after which companies will not be able to put any more employees onto the scheme.
This is designed to prevent firms putting full-time employees onto the scheme and bringing them back part-time, which the scheme is expected to be extended to cover.


cityam--2020-05-27--FTSE 100 rallies as reopening optimism takes hold

The FTSE 100 extended gains made yesterday as investors focused on the phased reopening of the economy .
London ’ s blue-chip index is up 1.34 per cent at 6,148 points as investors took comfort in increased hopes of a recovery .
Read more : British Land falls to £1.1bn loss as coronavirus pandemic hits rent payments The Prime Minister has set out plans to reopen parts of the economy from next week , as the number of daily coronavirus cases and deaths fall .
From next week , car showrooms and open markets will reopen , followed by non-essential @ @ @ @ @ @ @ : Hammerson boss David Atkins to step down after a decade A slow reopening of the economy , paired with hopes over potential coronavirus vaccines , has helped invigorate the FTSE 100 .
“ The only problem is that markets might be getting over-optimistic about the pace of corporate earnings recovery .
If financial results don ’ t match expectations in the coming months then the stock market rally could come under threat , ” says Russ Mould , investment director at AJ Bell .
Tui continued to lead the FTSE 100 ’ @ @ @ @ @ @ @ with shares jumping 20 per cent .
It extends the staggering gains made yesterday on the back of news that European holiday destinations could open this summer .
It means its share price has now risen 90 per cent since 22 May ’ s market close .
The FTSE 100 ’ s optimism was mirrored in Europe with shares up across the board after the European Commission unveiled a €750bn stimulus package to help the bloc through the pandemic .
The European Stoxx 600 gained 0.69 per cent , while Germany ’ s @ @ @ @ @ @ @ ’ s Cac both jumped 1.93 per cent .
The EU ’ s package is set to be dividend between €500bn in grants and €250bn in loans .
They will be borrowed on financial markets and distributed to member states , in a bid to stop the bloc slipping into recession .
Some European countries , including Spain , Italy and Greece , are expected to restart their struggling economies through borrowing and their reliance on tourism .
The Spanish government earlier this week indicated it would be open for visitors from July @ @ @ @ @ @ @ podcast as we chart the economic fallout and business impact of the coronavirus pandemic .
The European markets seemed to shake off the growing tensions between the US and China .
However , Asian shares retreated overnight after reports suggested that the Trump administration is considering a range of sanctions against China .
In a White House briefing , Trump indicated there will be announcement before the end of the week as anger at China continues to mount .
The Shanghai Composite fell 0.34 per cent while Hong Kong ’ s Hang Seng @ @ @ @ @ @ @ , the Nikkei 225 soared to a near three-month high at close , boosted by the announcement of a $ 1.1 trillion stimulus package .
Additionally , news that China had expanded the scope of its national security legislation against Hong Kong did little to quell nerves .
Riot police in the city fired on protestors , rekindling concerns about the protests seen last year which hit the territory ’ s economy .
“ The one per cent increase currently suggested by the [ Dow Jones ] futures would take the US index @ @ @ @ @ @ @ in early March , ” said Connor Campbell , financial analyst at Spreadex .
“ Whether it not it makes good on that forecasts , however , may be dependent on whether Trump sticks to his word regarding taking action against China.
” Charalambos Pissouros , senior market analyst at JFD Group , said : “ Tensions between the world ’ s two largest economies could jeopardize any potential trade accord , but at the moment , investors appear to be placing more bets on a global economic recovery as governments around the @ @ @ @ @ @ @ ” Get the news as it happens by following City A.M. on Twitter .

FTSE 100 rallies as reopening optimism takes hold
The FTSE 100 extended gains made yesterday as investors focused on the phased reopening of the economy.
London’s blue-chip index closed up 1.26 per cent at 6,144 points as investors took comfort in increased hopes of a recovery.
The Prime Minister set out plans to reopen parts of the economy from next week, as the number of daily coronavirus cases and deaths fall.
From next week, car showrooms and open markets will reopen, followed by non-essential retail a fortnight later.
“If reopenings continue to gather pace with a welcome absence of further infections, then travel, airlines, mines and engineering could see further inflows of investor cash,” said Chris Beauchamp, Chief Market Analyst at IG.
A slow reopening of the economy, paired with hopes over potential coronavirus vaccines, helped to reinvigorate the FTSE 100.
“If financial results don’t match expectations in the coming months then the stock market rally could come under threat,” says Russ Mould, investment director at AJ Bell.
Tui continued to lead the FTSE 100’s biggest risers in early trading, with shares jumping 20 per cent before closing up 16 per cent.
It extended the staggering gains made yesterday on the back of news that European holiday destinations could open this summer. It means its share price has now risen 90 per cent since 22 May’s market close.
European markets buoyed by €750bn stimulus package
The FTSE 100’s optimism was mirrored in Europe with shares up across the board after the European Commission unveiled a €750bn stimulus package to help the bloc through the pandemic.
The European Stoxx 600 gained 0.69 per cent before closing flat, while Germany’s Dax closed up one per cent. France’s Cac both jumped 1.41 per cent.
The EU’s package is set to be dividend between €500bn in grants and €250bn in loans. They will be borrowed on financial markets and distributed to member states, in a bid to stop the bloc slipping into recession.
Some European countries, including Spain, Italy and Greece, are expected to restart their struggling economies through borrowing and their reliance on tourism. The Spanish government earlier this week indicated it would be open for visitors from July.
Listen to our daily City View podcast as we chart the economic fallout and business impact of the coronavirus pandemic.
US-China tensions hold back Asian stocks
The European markets seemed to shake off the growing tensions between the US and China.
However, Asian shares retreated overnight after reports suggested that the Trump administration is considering a range of sanctions against China. In a White House briefing, Trump indicated there will be announcement before the end of the week as anger at China continues to mount.
The Shanghai Composite fell 0.34 per cent while Hong Kong’s Hang Seng index dropped 0.8 per cent. However, the Nikkei 225 soared to a near three-month high at close, boosted by the announcement of a $1.1 trillion stimulus package.
Additionally, news that China had expanded the scope of its national security legislation against Hong Kong did little to quell nerves. Riot police in the city fired on protestors, rekindling concerns about the protests seen last year which hit the territory’s economy.
“The one per cent increase currently suggested by the [Dow Jones] futures would take the US index to 25250, a level last seen in early March,” said Connor Campbell, financial analyst at Spreadex. “Whether it not it makes good on that forecasts, however, may be dependent on whether Trump sticks to his word regarding taking action against China.”
Charalambos Pissouros, senior market analyst at JFD Group, said: “Tensions between the world’s two largest economies could jeopardize any potential trade accord, but at the moment, investors appear to be placing more bets on a global economic recovery as governments around the globe continue to ease their lockdown measures.”
Get the news as it happens by following City A.M. on Twitter.