Mar 31, 2020

Market Insider | Biggest Moves Premarket: Stocks making the biggest moves in the premarket: Conagra, Carnival, RH, Visa & more

Peter Schacknow



Take a look at some of the biggest movers in the premarket:

Conagra (CAG) – The food producer missed estimates by 2 cents a share, with fiscal third-quarter profit of 47 cents per share. Revenue also came in slightly short, however Conagra said it has seen significantly elevated demand for its food products over the past few weeks due to the virus outbreak. The company now expects to exceed its full-year sales and profit guidance.
Carnival (CCL) – The cruise line operator is suspending dividend payments and stock repurchases, as voyage suspensions continue amid the coronavirus outbreak. Carnival said it could not estimate the impact of COVID-19 on its business, but expects a net loss for fiscal 2020.
McCormick (MKC) – The spice maker earned $1.08 per share for its latest quarter, 5 cents a share above estimates. Its revenue was below forecasts, however, as results were impacted by the coronavirus outbreak. The company withdrew its prior financial forecast due to uncertainties surrounding the COVID-19 pandemic.
RH (RH) – RH reported quarterly profit of $3.72 per share, beating consensus by 13 cents a share. The Restoration Hardware parent's revenue was well short of estimates, however, amid lower traffic and more backorders during the holiday season. The furniture retailer also withdrew its financial guidance.
Amarin (AMRN) – Amarin received an unfavorable ruling from a Nevada court in a patent case involving its fish oil drug Vascepa, used to treat patients with high triglyceride levels. The court ruled in favor of Hikma Pharmaceuticals and Dr. Reddy's Laboratories (RDY), which want to make generic versions. Amarin said it would pursue all available legal remedies.
British American Tobacco (BTI) – BAT and rival British cigarette maker Imperial Brands both announced deals for new multi-billion dollar credit lines, although they also say they are not seeing any major impact on their businesses from the coronavirus outbreak.
American Airlines (AAL) – The airline plans to apply for up to $12 billion in government assistance, according to an employee memo seen by Reuters. That would mean no involuntary layoffs or pay cuts over the next six months.
Spirit Airlines (SAVE) – Spirit is canceling all flights to and from New York, New Jersey, and Connecticut, following warnings from US officials not to travel to the tri-state area because of the COVID-19 pandemic.
Yum Brands (YUM) – Yum sold $600 million in junk-rated debt, with the restaurant chain planning to use the money for "general corporate purposes." The debt carries a yield of 7.75%, much higher than the 4.75% Yum paid in a debt issue in December.
Gap (GPS) – Gap will furlough most of its 80,000 retail workers, as many of the apparel retailer's stores remain closed. Gap will also cut corporate jobs and executive pay.
Visa (V) – Visa said its transaction volume deteriorated during the second half of this month, as countries impose social distancing and sheltering in place due to the virus outbreak.
Domino's Pizza (DPZ) – The restaurant chain withdrew its financial guidance, as many stores in international markets remain closed, although most U.S. locations remain open.
Norwegian Cruise Line (NCLH) – Norwegian extended its voluntary suspension of cruises through May 10, after originally suspending them through April 11.
Zoom Video Communications (ZM) – Zoom's privacy practices are being investigated by the New York State attorney general's office, according to a report in The New York Times.

Analysis | The Cybersecurity 202: Coronavirus response is officially a new front in the election security fight


By Joseph Marks



A woman wearing mask and protective gloves leaves after cast her vote during the Florida Democratic primary election in Miami, Florida. (Photo by Eva Marie UZCATEGUI / AFP) 

THE KEY
The brief detente in partisan bickering over how to ensure people are safe to vote – and their votes are safe – amid the coronavirus pandemic just burst into open warfare. 
President Trump suggested on Fox and Friends that one reason he opposed a $4 billion infusion of election money Democrats sought for the coronavirus stimulus was that it might have led to more Democratic victories. Democrats wanted the money to go toward expanding secure vote by mail or early voting options to reduce the risk of people getting infected, should the pandemic still pose risks by November.
“They had things, levels of voting that if you ever agree to it, you’d never have a Republican elected in this country again,” he said, seeming to suggest that higher turnout would help Democrats.
House Administration Committee Chair Zoe Lofgren (D-Calif.) shot back, calling that “a monstrous example of putting party ahead of America” and accusing the president of forcing citizens to vote in unsafe ways. The stimulus bill ultimately included $400 million for election security related to the pandemic but no rules for how states must spend it.
“Every American, regardless of party affiliation, should condemn the president’s apparent belief that it’s a good thing for American voters to risk their lives when safer voting alternatives are possible,” she said.
The partisan flame-throwing is also happening on the state level: Voting rights advocates in Ohio and Wisconsin, two important swing states in November, are suing to stop primary elections they say are being rushed in ways that threaten voters’ safety or could tamp down turnout.
The response to coronavirus is now officially a new front in the fight about election security in Washington, which until now has focused on preventing foreign adversaries from upending 2020 with hacking or disinformation campaigns.
And with a pressure cooker atmosphere of just seven months to go before the general election and no clear indication how long American life will be upended by the pandemic, it risks undermining voters’ confidence that elections will be safe and secure. State election officials, who so far seem relatively united across party lines in pushing for more voting by mail and extended early-voting periods to manage the crisis, will each have to make tough choices about how to proceed.
Trump critics quickly lashed out at the president’s comments on Twitter.
Here’s from Vanita Gupta, former head of the Justice Department’s civil rights division, who’s now chief executive of the Leadership Conference on Civil and Human Rights:
This is wild for many reasons, but worth noting that Trump responds to a question about "special interest projects" by talking about funding for VOTING.
This is not a special interest project, it is our DEMOCRACY – and ensuring it can function should be a bipartisan emergency. https://t.co/asnt4uVbEH
— Vanita Gupta (@vanitaguptaCR) March 30, 2020
And Rep. Bill Pascrell Jr. (D-N.J.):
When you say the quiet part out loud.
Democracy can't ever take a nap. We voted during the Civil War, we voted in WWII, and we'll do whatever's necessary to help every state cast ballots in 2020 despite trump's antagonism to voting. https://t.co/B1QntXfh77
— Bill Pascrell, Jr. (@BillPascrell) March 30, 2020
Things are already getting messy on the state level. In Ohio, the state’s chapter of the American Civil Liberties Union filed a lawsuit last night to delay an April 28 mostly vote-by-mail primary scheduled by the Republican-controlled legislature. It would make up for a conventional primary Gov. Mike DeWine (R) canceled two weeks ago citing a public health crisis.
A single month isn’t nearly long enough to manage the complex process of an all-mail election, according to the lawsuit, which was also filed on behalf of the League of Women Voters of Ohio; the Ohio A. Philip Randolph Institute, which advocates for seniors and union members; and several Ohio voters. The early primary date will disenfranchise wide swaths of voters who aren’t used to voting by mail and will have trouble navigating the process, they say.
That’s effectively the same position advocated by DeWine and Ohio Secretary of State Frank LaRose (R) who asked the legislature for an early June primary date and $10.5 million in new funding — enough to send forms to request an absentee ballot to every registered Ohio voter along with a postage-paid envelope.
The legislative plan includes sending voters a postcard with instructions for requesting an absentee ballot but requires the voters to handle more of the details themselves and cover postage.
LaRose hoped to raise the approximately 35 percent of Ohioans who typically vote by mail to as near 100 percent as possible without diminishing turnout, he told me last week — a process that will be far harder with the earlier primary date.
After the legislature nixed his proposal, LaRose described the new timeline as “very tight” to the Associated Press.
“I’m a good soldier,” he said. “And when the Legislature has spoken, we’re going to carry out the legislation they created to the best of our ability.”
In Wisconsin, meanwhile, voting advocacy groups have filed a bevy of lawsuits aimed at loosening rules for absentee voters and delaying the state’s primary — which is still scheduled for April 7 despite widespread concerns that it will be unsafe for voters to gather then.
Wisconsin Gov. Tony Evers (D) is also locked in battle with the GOP-controlled legislature over whether to send absentee ballots to the state’s 3.3 million registered voters ahead of the primary. Evers just introduced the plan on Friday, with about two weeks to go before the primary, the New York Times reported.
Scott Fitzgerald, the state Senate’s Republican majority leader, called Evers’s plan a “fantasy,” the Times reported.
“In pitching this idea, the governor is lying directly to Wisconsinites about this even being remotely possible. Acting like this is doable is a hoax,” Fitzgerald said.
Evers defended the effort, saying, “It ain’t gonna be easy, but we’re gonna do it.”

PINGED, PATCHED, PWNED


Zoom's logo. (Olivier Douliery/AFP/Getty Images)
PINGED: New York regulators want answers about how the videoconferencing app Zoom, which has surged in popularity during the coronavirus pandemic, is protecting users' data and privacyDanny Hakim and Natasha Singer at the New York Times report.
New York Attorney General Letitia James expressed concerns that Zoom might not have the resources to deal with a boom in users that has made the platform an attractive target for hackers and scam artists. She also wants to know how the company dealt with past security bugs, including a vulnerability that allowed hackers to access users' cameras.
The letter also asks what other companies Zoom is sharing user data with, noting a recent Motherboard report that the company shared data from its iPhone app users with Facebook. (Zoom has since removed the feature.)
Zoom might also be violating state requirements that companies protect student data as more teachers flock to the service to teach remote lessons, James said.
Zoom pledged to cooperate with James's requests and told the Times it takes “its users’ privacy, security and trust extremely seriously.”

House Speaker Nancy Pelosi (D-Calif.). (Andrew Harnik/AP)
PATCHED: Remote voting is not going to happen anytime soon for lawmakers in the House despite the danger the chamber’s close quarters could spread coronavirus, Speaker Nancy Pelosi (D-Calif.) told reporters yesterday, according to my colleague Felicia Sonmez.
Pelosi sounds a pessimistic note when asked about the potential for remote voting in the House. She says there's no way it's possible without discussion in the House and changing the rules. “So let’s not waste too much time on something that’s not going to happen.”
— Felicia Sonmez (@feliciasonmez) March 30, 2020
Both the House and Senate failed to pass rule changes that would allow for remote voting before leaving Washington last week, despite members from both parties pushing for the changes. Nearly 70 members of the House joined Rep. Katie Porter (D-Calif) in urging the House Rules Committee to allow for remote voting. The committee responded with a memo citing concerns including that manipulated videos could be used to fake votes.
But open-government advocates warn that if lawmakers aren't able to vote during the national emergency, it could open the door to a power grab by the White House. Demand Progress Policy Director Daniel Schuman:
Opponents of remote Congressional voting have forgotten that when Congress is unable to act, the Executive Branch fills in the gap -- whether constitutionally or otherwise. Example 1: a presidential signing statement undermining IG reports to Congress https://t.co/733mAdgO8x pic.twitter.com/f0k5pE17Z3
— Daniel Schuman (@danielschuman) March 28, 2020
Right now it's unclear when the House is set to return, and that date could remain in limbo as more members have to self-quarantine or are unable to travel for other reasons. That could delay future efforts to fight the virus and manage essential government operations.
The Senate is set to return April 20.

A roll of “I Voted!” stickers. (Jayme Gershen/Bloomberg News)
PWNED: A well-known company that organizes ethical hackers to test products for bugs is refusing to do business with the mobile voting app Voatz after researchers reported hostile interactions with the company, CyberScoop's Sean Lyngaas reports
The move by Hacker One comes after repeated clashes between Voatz and researchers that reported hackable vulnerabilities in its app. Voatz also changed its policy last month to say it couldn't guarantee legal protections for hackers digging into its systems, sparking alarm from researchers.
We partner with organizations that prioritize acting in good faith towards the security researcher community and providing adequate access to researchers for testing, a HackerOne representative told Sean. It's the first time the platform, which works with companies including Uber and AT&T, has publicly expelled a client.
Researchers and lawmakers have heavily scrutinized Voatz, which they say has too many vulnerabilities to be used safely. 
Voatz’s bug bounty was more of a PR talking point than an attempt to truly engage with the security community,” Kevin Skoglund, chief technologist at the nonprofit group Citizens for Better Elections, told Sean.
Voatz chalked up the criticism to a grudge by researchers who have accused the company of reporting a hacker to the FBI. The company will soon launch its own system for independent researchers to report bugs, it said.

PRIVATE KEY

Hackers are continuing to exploit government and private-sector responses to the coronavirus pandemic, and they’re finding new ways to hack users stuck indoors and online, new reports show. Here's a rundown:
  • Hackers are creating bogus sites that claim to have information about stimulus cash for citizens recently approved by Congress but that actually contain information-stealing malware, researchers at Cisco Talos say
  • Hackers have posed as officials with the U.S. Small Business Administration to seed struggling business owners with malware, IBM X-Force researchers found. In just the past 14 days, the researchers have seen a 14,000 percent increase in spam related to covid-19, they said. 
  • The number of suspicious domains and files referring to the teleconferencing company Zoom have also increased, researchers at Check Point observed
A coalition of 13 nonprofit organizations joined a new initiative from the Global Cyber Alliance to help businesses secure their newly remote workforces. Members of the campaign include Aspen Digital, part of the Aspen Institute, and the Cyber Threat Alliance.
— More cybersecurity news from the private sector:

Contractors battle bogus assertions about canine vaccines and free baby formula: “We’ve maxxed out.”
Wall Street Journal

The health care sector has increasingly turned to artificial intelligence to aid in everything from performing surgeries to helping diagnose and predict outcomes of patient illnesses. 
The Hill

PUBLIC KEY

Cybersecurity news from the public sector:

Exclusive: The exposed cache of code contained app secrets and internal passwords.
TechCrunch

Official Chinese accounts adopted a "more confrontational posture" in messaging on COVID-19, beginning in late February and March, as cases were confirmed across Europe and within the U.S.
CBS News

Courts have struggled to interpret the vague Computer Fraud and Abuse Act.
Ars Technica

FBI agents have arrested a Russian citizen accused of laundering money for a cybercriminal gang that allegedly stole funds from a range of U.S. banks.

THE NEW WILD WEST

Cybersecurity news from abroad:

Israel's defense ministry plans to use software that analyses data gathered from mobile phones - produced, according to Israeli media, by the spyware firm NSO - to help locate likely carriers of the coronavirus in order to test them.
Reuters

ZERO DAYBOOK

  •  The Alliance for Securing Democracy  will hold an interactive webinar to discuss narratives and long-term trends in China’s information manipulation efforts at 10:00 a.m. ET. 

Market Insider: Stocks could get a buying boost on Tuesday from a Wall Street technical phenomenon

Patti Domm




GP: Wall Street subway station 200324
A man walks by the Wall Street subway sign on March 23, 2020 in New York City.
Angela Weiss | AFP | Getty Images

Some traders are looking for a surge in stock buying on Tuesday as fund managers rebuild their stock holdings in the final hours of the worst quarter for the Dow since 1987.
That’s because as stocks lost ground, pension funds’ allocation to equities shrank, and as bonds rallied, those assets in their portfolios increased. In addition to pensions, other funds and investors may also see the need to conduct a rebalancing to shift the mix back by Tuesday’s closing bell, the end of the month and the first quarter.
That simply means they could sell bonds and buy stocks.
“The rebalancing story is something everybody is watching very closely. It might help temporarily prop up some asset prices, either directly or via the expectations it might happen,” said Jon Hill, senior BMO rate strategist. “The question is what happens April 1? I think this is a second order factor, but everybody is trying to rebalance everything they’re doing. I’m not sure that leads to a huge flood into equities just because of the state of market uncertainty.”
The Dow is down 21.8% so far this quarter, the worst quarter since the 25% decline in the fourth quarter of 1987 and the worst first quarter ever.  The S&P 500 is on pace for an 18% decline, its worst quarter since the fourth quarter of 2008, and its worst first quarter since 1938.
“We think there’s an element of people positioning themselves for a big buy,”  said Julian Emanuel, chief equities and derivatives strategist at BTIG. Emanuel said the forecasts for how much funds might buy range wildly from $20 billion to over $200 billion, and he blames those expectations for some of the market volatility.
“The best, ideal scenario... would be for nothing to happen in markets,”  Emanuel said, adding the market needs some less volatile sessions.  “Everybody’s on a hamster’s wheel in light of the rally last Tuesday, Wednesday and Thursday. What you really need is a couple of days for both buyers and sellers to catch their breath...What you need is several days of calm so people can reassess instead of this utterly frantic feeling to the downside and the upside. Coming out of the pension rebalancing is a very good time.” 

Did the rebalance already happen?

Futures were flat in early morning trading.
Emanuel said the buying may in fact have already been happening. “In theory, they say that kind of thing is supposed to happen at the close tomorrow but in practice it very rarely turns out that way,” he said. “Our mantra has been to buy weakness. Do not chase strength. Could you get a retest of the lows in the next few weeks? You absolutely could.”
Michael Schumacher, director, rates at Wells Fargo, said his team initially forecast $40 billion in outflows from stocks, but with the rally over the past week, the rebalancing looks to be more like $20 billion out of stocks and into bonds. The S&P 500 is up 7% already the last 5 days.
“We look at the total gap between where we think pensions are today, and what their target is,” he said. “We calculate that’s at $80 billion, and we assume at quarter end the rebalance is about a quarter of it - that gives us $20 billion. In rough numbers, call it 50 to 55% in equities and 35 to 40% in high quality bonds.”
Schumacher said the weakness in Treasurys signal some selling Monday, but it was not clear if it was due to rebalancing.

Morning Mix: Fauci socks, Fauci donuts, Fauci fan art: The coronavirus expert attracts a cult following

Antonia Noori Farzan


Early last week, Nick Semeraro decided that he wanted to find a way to honor Anthony S. Fauci. As the owner of a small doughnut shop in Rochester, N.Y., he had been closely tracking the latest news about the coronavirus pandemic. And night after night, he’d been impressed by how Fauci, the director of the National Institute of Allergy and Infectious Diseases, approached the crisis in a calm, knowledgeable manner.
So, as a tribute, Semeraro put the renowned immunologist’s face on a doughnut. Expecting to sell a few hundred, he was shocked when the store sold out day after day, with thousands flying off the shelves. Donuts Delite was besieged with requests to ship the buttercream-frosted creations all over the country, and one Fauci fan drove three hours just to pick up a dozen. Soon, bakeries in Wisconsin and Pennsylvania followed suit, using edible paper to decorate pastries with Fauci’s likeness.
“We had no idea it was going to blow up this big,” Semeraro told CNN. “We didn’t know everyone else felt the same way we did.”
While Fauci was already a respected scientist before the outbreak, his appearances during White House press briefings have made him a household name and an unlikely celebrity. With his straightforward demeanor and willingness to contradict President Trump, he’s begun to develop the same kind of cult following as Supreme Court Justice Ruth Bader Ginsburg and special counsel Robert S. Mueller III, who inspired countless “Plank like RBG” tank tops and a bizarre illustrated children’s book, respectively.
Even as whole swaths of the global economy are collapsing, the pandemic has created a robust cottage industry of Fauci-themed merchandise, from bottle openers to magnets to mugs. On Etsy, you can buy “Honk for Dr. Fauci” bumper stickers, prayer candles depicting “St. Fauci” and socks printed with Fauci’s face. Graphic T-shirts bear slogans like “I Need a Hero” and “In Dr. Fauci We Trust.”
If so inclined, you can even decorate your home with a “I Heart Dr. Fauci” throw pillow, or purchase a replica of Fauci’s jersey from the time he captained the basketball team at Manhattan’s Regis High School. Lingua Franca, which sells cashmere sweaters embroidered with resistance-friendly slogans for $380 and up, recently began taking orders for an army-green “Dr. Fauci Fan Club” knit.
In honor of Fauci’s Italian heritage, a clam bar in Long Island, N.Y. named a linguine dish after him this week. (Available for pickup only, “the linguine with white clam sauce shares origins with Fauci, as the sauce itself was invented in the Fauci Family’s native Sciacca, Italy,” the restaurant claimed in a statement.)
Inbox: "FAUCI LINGUINI: ICONIC CLAM BAR IN PROUD ITALIAN-AMERICAN COMMUNITY TO NAME DISH AFTER AMERICA’S HERO DOCTOR"
— Jillian Jorgensen (@Jill_Jorgensen) March 30, 2020
As countless Americans remain glued to the news while trying to stay indoors, a robust Fauci fandom has flourished online. On Facebook, the “Dr. Anthony S. Fauci Fan Club” has over 32,000 members. Thousands more congregate in groups with names like “Dr. Anthony S. Fauci, the Man, the Myth, the Legend,” “Dr. Fauci Speaks, We Listen” and “Dr. Fauci Memes for Social Distance Teens.”
An unassuming 79-year-old public servant who has advised six presidents, Fauci has become a “reliable constant in a time of uncertainty,” The Washington Post’s Ellen McCarthy and Ben Terris reported. But his admirers — and there are a lot of them — worry that it’s only a matter of time before he’s sidelined by Trump.
I am a:
🔲 man
🔲 woman
☑️ fan club
Seeking:
🔲 man
🔲 woman
☑️ 💓Anthony Fauci, MD💓
— Anthony Fauci Fan Club (@FauciFan) March 24, 2020
When Fauci missed a White House news conference earlier this month, panic erupted on Twitter, along with speculation that he could be sick. There was palpable relief when he resumed his regular position at the podium the following day, and appeared to hide some exasperation as Trump referenced “the deep state.”
Fauci later explained that he had simply been trying to dislodge a lozenge from his throat. But the much-analyzed “Fauci facepalm” had already become a meme, deployed by liberal members of the so-called “resistance.”
Fauci’s newfound fame can be partially attributed to his willingness to engage with all forms of media — in recent weeks, he’s gone on a Barstool Sports podcast, chatted with basketball star Steph Curry on Instagram Live as Barack Obama listened in, and appeared on “The Daily Show with Trevor Noah.”
But it also undoubtedly helps that his fans tend to take social distancing seriously, and consequently have ample spare time to produce fan art or perform songs written (or modified) in his honor.
On social media, Fauci’s virtual fan clubs peruse old photos of the infectious disease expert in search of “comfy turtleneck vibes,” stitch his face on embroidery hoops and discuss erecting statues as tribute. They frost his name on cookies and joke about constructing shrines in his honor. Prominent activists and entertainers confess to wanting to marry him, or have him tuck them into bed.
Fauci has remained characteristically modest about his new status as a cult figure. “Well, that’s very nice,” he responded when McCarthy and Terris mentioned that people all over the country were praying for him. Of course, that means that his fan base has only continued to grow.
“I never met a guy that, worldwide, he is so loved,” Semeraro, the Rochester doughnut shop owner, told CNN. “And a month ago, we never knew his first and last name.”

World Economy: South Africa looks to structural reforms as it loses its last investment-grade credit rating

Elliot Smith




GP 200331: Tito Mboweni, South African finance minister
PRETORIA, SOUTH AFRICA - MARCH 16: Finance minister, Tito Mboweni briefs the media on the details of government interventions in various sectors of the departmental portfolios on COVID-19 at DIRCO Media Centre.
Phill Magakoe/Gallo Images via Getty Images

South Africa has lost its last remaining major investment-grade sovereign credit rating, as existing economic weakness is compounded by the potential impact of the global coronavirus pandemic.
South Africa has no investment-grade sovereign credit rating from any of the major ratings agencies for the first time since its return to global markets in 1994.
Moody’s announced on Friday that it had cut the country’s last investment-grade rating to “junk,” sending the Rand to an all-time low of below 18 to the dollar. Standard & Poors and Fitch both downgraded Africa’s most industrialized economy to sub-investment grade in 2017.
In its release, Moody’s cited structurally weak growth, limited capacity to stimulate the economy and an “inexorable rise” in government debt over the medium term as key reasons for the downgrade and maintenance of its “negative” outlook.
The situation has been exacerbated by the expected economic impact of the coronavirus pandemic. Confirmed cases in South Africa have now exceeded 1,300, though the government is hoping that drastic early lockdown measures will prevent the exponential spread seen in Europe and the U.S.
“Unreliable electricity supply, persistent weak business confidence and investment as well as long-standing structural labour market rigidities continue to constrain South Africa’s economic growth,” Moody’s said, adding that these factors mean South Africa is entering a period of much lower global growth in an “economically vulnerable position.”
Debt-to-GDP (gross domestic product) increased by 10 percentage points from 2014-18 and Moody’s expects this to rise by a further 22 percentage points between 2019 and 2023, with the deficit widening in 2020 to around 8.5% of GDP.
Fiscal strains from interest payments and support to state-owned enterprises will continue, the agency predicted. The government debt burden is expected to rise from 69% of GDP in 2019 to 91% by the end of 2023.

‘It is up to South Africa’

South Africa’s credit rating has deteriorated because of very low (and currently negative) economic growth, large fiscal deficits and sharply rising public debt, loss-making state-owned entities, and deep contestation of proposed social and economic policy reforms,” explained Jeff Gable, head of research at South Africa’s Absa Bank.
In a statement Monday, Gable suggested that whether South Africa will return to investment grade or slide further away relies on the country demonstrating “significant improvement” in its economic reforms.
“It is hard to argue that South Africa hasn’t witnessed a steep deterioration in fundamentals, in part by our own inability to act over the last decade and in part due to the new risks due to the global virus,” Gable said.
“And so it is the agencies’ duty to reflect that in their ratings. Similarly it is clear that it is up to South Africa, and not the credit rating agencies, as to which direction that country would like to take going forward.”

Bold structural reforms

On Sunday, Finance Minister Tito Mboweni and South African Reserve Bank (SARB) Governor Lesetja Kganyago held a media conference call, in which Mboweni said that he and President Cyril Ramaphosa had vowed to move “more boldly” on their structural reforms program.
Mboweni announced the creation of a unit within the finance ministry called “Vulindlela” – which means “lead the way” in isiZulu – that “will become the front soldiers of structural reforms in the South African economy,” according to a research note Monday from NKC African Economics.
President Cyril Ramaphosa during a pre-World Economic Forum breakfast briefing on January 18, 2018 in Johannesburg, South Africa.
Moeletsi Mabe| Sunday Times | Gallo Images | Getty Images
The finance minister also suggested in an interview with newspaper City Press over the weekend that the World Bank, and not the IMF (International Monetary Fund), would be the first port of call for loan financing.
“The World Bank, unlike the IMF, does not typically attach conditions to its loans. This is why it will be a more politically palatable action for the government in South Africa, where public opinion is generally suspicious of the IMF and the effects its policy prescriptions have had in poor countries,” NKC Senior Political Economist Francois Conradie said Monday.
However, Conradie suggested that the types of reforms which will address the issues that led to Moody’s downgrade, such as deep cuts to the public sector wage bill, privatizing state-owned enterprises (SOEs), or relaxing strict labor legislation, will be a hard political sell.
“Government has been good, in recent weeks, in communicating its response to the pandemic by explaining how the lockdown works, but now it will have to be clear in communicating its economic policy response as well,” he added.

Opinion: The winners and losers of the coronavirus’s global test of governance

Jackson Diehl



An emergency tends to reveal the core character of national leaders, along with that of the political systems that produced them. What’s truly exceptional about the coronavirus pandemic is that it is confronting scores of countries simultaneously with the same awesome challenge. We are learning a lot about the state of global governance as a result.
In one category are the democratic populists, such as President Trump, Brazilian President Jair Bolsonaro and Mexico’s Andrés Manuel López Obrador. Their response to the spread of the novel coronavirus has been to spew misinformation, minimize the threat and dodge accountability. Trump predicted the virus “is going to disappear . . . like a miracle.” Bolsonaro dismissed it as no more than a “little cold.” López Obrador said there was no reason for people to stop hugging and kissing, because “nothing happens.” All three resisted measures to contain the spread of the virus or called for their early removal — though López Obrador and Trump shifted their positions over the weekend.
The result? Infections have risen at a far faster rate in the United States and Brazil than in Asian countries that took the threat more seriously. In Mexico, cases are climbing quickly. With the presidents’ abdications, the burden of governance has fallen on state and local administrations, creating confusion and competition for resources.
Next come the police states, from China and Russia to Iran, Venezuela and North Korea. They, too, have a common playbook: First, lie about the numbers. Then employ heavy-handed and intrusive measures against infected people and communities. Portray leaders as conquering heroes — and arrest anyone who offers a different narrative.
Vladimir Putin’s handling of the pandemic has been as predictable as the photo op he staged wearing a bright-yellow containment suit (no word on whether he was bare-chested underneath). He claimed that Russia has managed to hold covid-19 cases to a remarkably low level, even as skeptics note that reported instances of “pneumonia” rose 37 percent in January. When a political analyst claimed the death toll was far greater than reported and compared the handling of the outbreak to the coverup of the Chernobyl nuclear accident, the radio station that interviewed him was ordered to remove the piece as part of “measures to prevent the spread of false information.”
The same story has played out in Wuhan and Caracas, where official reports of case numbers look unreliable and those who tell a different story are threatened or arrested. But Xi Jinping and Nicolás Maduro look transparent compared with North Korea’s Kim Jong Un, whose regime claims that its covid-19 case count is . . . zero. Never mind that North Korea has closed its borders, reportedly declared a state of emergency and placed diplomats under quarantine — or that, according to South Korean reports, masks are being traded on the black market and distributed to elites.
If the autocrats are to be believed, their methods have been more effective in containing the virus than those of the democracies. But with the possible — and possibly temporary — exception of China, that doesn’t seem to be true. In any case, few believe them, either at home or abroad.
A third category of nations is those democracies that have taken the epidemic seriously but reacted too slowly, in part because of dysfunctional bureaucracies and governments hamstrung by political polarization. Italy, a victim of years of irresponsible populist rule and now governed by an unlikely coalition of populists and leftists, fits that definition. So does Spain, where a weak minority government emerged from two rounds of inconclusive elections last year. At the beginning of this week they ranked first and second in the number of covid-19 deaths worldwide, way above European neighbors with more stable governments, such as Germany.
So who are the winners in this global test of governance? A glance at the trend lines on the comparative chart posted by the Financial Times newspaper makes that very clear. South Korea, Singapore and Hong Kong have by far the flattest trajectories for deaths — and not included is Taiwan, a country of 24 million that as of Monday had recorded 306 cases; the District of Columbia, population 600,000, had 405.
Those Asian governments all had firsthand experience with a previous epidemic originating in China, SARS. Their governments were quick to take the new coronavirus seriously; far from ignorantly discounting the threat, they pushed their citizens to get tested and to quarantine themselves when the results were positive. Masks are ubiquitous on the streets of their cities, even among the well.
Coercion, however, has not been necessary to their success. Two of the four are democracies; the other two, Singapore and Hong Kong, are more free than Russia or China. What they show is that neither Trump-style grandstanding nor Putin-esque repression is effective against the coronavirus — but common sense and competence are.
Read more:

Coronavirus Live News: World Bank warns of 'unprecedented global shock' as US records its deadliest day

Ian Sample



The United Arab Emirates has extended a daily overnight curfew for a nationwide disinfection drive to April 5, but Dubai announced late on Monday that a 24-hour curfew would be imposed on Al Ras district for two weeks starting Tuesday.
“I am glad they are doing this because it is for our protection,” said one rice trader who works in Al Ras but resides in Sharjah emirate. The trader, who declined to be named, told Reuters he is now conducting his business online.
Dubai closed the main road entrances to Al Ras and halted public transport to the area, which abuts Dubai Creek, where dhow have been banned from transporting goods between Dubai and Iran, a regional epicentre for the virus.
Dubai Health Authority will provide essential supplies to Al Ras residents, Dubai Media Office tweeted.
The UAE has confirmed 611 coronavirus cases, with five deaths. The total number of infections in the six Gulf Arab states stands at more than 3,700, with 18 deaths.
The UAE plans to open drive-thru testing centres across the country, the region’s business and tourism hub, after first was opened last week in the capital, Abu Dhabi.
“We will never hesitate to take any measures against any potential threat to people’s life. At the same time, we won’t let the development grind to a halt,” Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed al-Nayhan, the country’s de facto ruler, said in comments carried on state media.
In Kuwait, Health Minister Basil al-Sabah was quoted on Tuesday as saying a clearer picture would emerge by early June on the success of containment efforts. Kuwait was the first Gulf state to halt passenger flights and impose a partial curfew.
“If infection numbers stabilise, there may be a gradual easing of current measures,” he told Al Rai newspaper. “But if the average rate of transmission increases then ... I do not rule out the cabinet enforcing a full curfew.”
Kuwait has recorded 266 infections. Its larger neighbour, Saudi Arabia, has passed 1,400, with eight deaths.
Saudi media posted a video showing security forces deployed in a sealed-off district in Mecca. The kingdom has extended its first lockdown, in the eastern Qatif region, to several districts in some main cities and imposed a partial nationwide curfew.

Business: American Airlines to seek $12bn US government aid

2-3 minutes - Source: BBC


American Airlines jet at Dallas/Fort Worth International Airport Image copyright Getty Images
American Airlines has confirmed it will seek $12bn (£9.7bn) of financial support from the US government because of the impact of coronavirus.
Employees were told in an email this "would allow us to fly through even the worst of potential future scenarios".
It said it would mean "no involuntary furloughs or cuts in pay rates or benefits for the next six months".
Staff will also be offered "enhanced voluntary leave and early retirement options".
Last year the company made a $2.9bn profit and returned $1.3bn to shareholders via dividends and buybacks, according to Bloomberg.
Under the massive $2.2tn coronavirus relief bill passed by the US Congress last week, $50bn was set aside for airlines with half given as grants.
The other half will be offered as loans in exchange for not furloughing employees until at least 30 September.
American Airlines, the world's biggest by passenger numbers, said it hoped to be back to flying a full schedule by then.
"These funds are being distributed to ensure continuation of essential airline service and protect jobs. We intend to apply for these funds and are confident that, along with our relatively high available cash position, they will allow us to fly through even the worst of potential future scenarios," said the email to staff from chief executive Doug Parker and president Robert Isom.
Global airlines have struggled as countries worldwide have grounded the majority of passenger flights since February as part of efforts to halt the spread of the coronavirus.
Another US airline, Delta, has also offered voluntary leave of absence, and carriers outside the US such as Singapore Airlines have unveiled plans to raise funds by tapping share and debt markets with the backing of sovereign investment fund Temasek Holdings.

Oil Pices: Oil prices are on track for their worst ever quarter as coronavirus slashes demand

Sam Meredith



GP: Pumpjacks in Tatarstan, Russia 200331 EU
A pumpjack near the Yamashinskoye rural settlement in the Almetyevsk District.
Yegor Aleyev | TASS via Getty Images

Oil prices are on pace to register their worst quarterly performance on record, as the coronavirus pandemic continues to crush global demand for crude.
A public health crisis has meant countries around the world have effectively had to shut down, with many governments imposing draconian measures on the daily lives of hundreds of millions of people.
The restrictions have created an unprecedented demand shock in energy markets, ramping up the pressure on companies and governments reliant on crude sales.
To date, more than 787,000 people have contracted COVID-19 worldwide, with 37,829 deaths, according to data compiled by Johns Hopkins University.
International benchmark Brent crude traded at $23.36 a barrel Tuesday morning, up more than 2.6%, while U.S. West Texas Intermediate (WTI) stood at $21.26, more than 5.8% higher.
Brent futures fell to their lowest level in 18 years on Monday and WTI ended the previous session below $20, before both benchmarks pared some of their losses on the final trading day of the first quarter.
To date, Brent futures have fallen more than 65% through the first three months of 2020, putting the benchmark on track to register its worst quarter through our history to 1990, according to data compiled by CNBC.
Brent is also on pace to record its worst-ever monthly performance, down over 54% in March alone.
Meanwhile, WTI futures slumped more than 67% for the first quarter, putting it on track for its worst-ever quarterly performance back to when the contract began trading in 1983.
WTI is also down over 55% month-to-date, on pace for its worst-ever monthly performance, too.

Storage capacity likely to ‘hit its limit by midyear’

Oil consumption has collapsed by at least 25% compared to 2019 levels of 100 million barrels per day (b/d), according to analysts at Eurasia Group, with severe restrictions on global movement and most retail in lockdown.
“With demand collapsing but supply rising after OPEC and non-affiliated Russia failed to reach a production cut agreement in early March, global inventories could reach their maximum capacity within weeks,” Eurasia Group analysts said in a research note published Monday.
“Even if OPEC and other producers start restricting their output again soon, the supply overhang from the global lockdown is so big that storage capacity will likely hit its limit by midyear,” they added.
Earlier this month, oil producer group OPEC and its allied partners, sometimes referred to as OPEC+, failed to agree on extending production cuts beyond March 31.
It has led to concerns of a supply surge from April 1, with Saudi Arabia and the United Arab Emirates both pledging to ramp up production.
Industry experts have warned that plans to ramp up production could prompt a wave of bankruptcies and investment cuts in the U.S. which, in turn, would have a noticeable impact on shale production.
On Monday, U.S. President Donald Trump and Russian President Vladimir Putin held talks to discuss Moscow’s ongoing oil price war with OPEC kingpin Saudi Arabia.
The Kremlin said Trump and Putin had agreed to have their top energy officials discuss stabilizing oil markets.
Trump had initially welcomed the declaration of a price war between Saudi Arabia and Russia, hailing lower oil prices as good news for U.S. consumers.

US Market | Futures Indicator: Stock futures positive again in choppy trade, building on market's rebound from massive coronavirus sell-off

Yun Li



Stock futures were positive in choppy trading early Tuesday morning, following the market's rebound from its deep rout triggered by the coronavirus pandemic.
At 4:35 a.m. ET, futures on the Dow Jones Industrial Average were 162 points higher, pointing to an implied opening rise of more than 136 points at Tuesday's open. S&P 500 futures and Nasdaq-100 futures also pointed to opening gains for the two indexes.
Earlier, futures had pointed to opening losses for the three indexes.
The overnight action followed a strong session on Wall Street, with the Dow jumping nearly 700 points led by an 8% pop in Johnson & Johnson after it announced a vaccine candidate for the coronavirus. The S&P 500 rallied 3.4%.
Investors embraced a more realistic government approach to contain the pandemic. President Donald Trump extended the timeline for social distancing guidelines to April 30, which many believe will reduce economic damage in the long run.
"I think the market has established some type of bottom," Tom Lee, head of research at Fundstrat Global Advisors, said on CNBC's Markets in Turmoil Special on Monday. "I don't know if this is October '08 here; We still have some wood to chop."
Stocks have managed to rally on concerning economic data including last week's record number of jobless claims and Monday's worse-than-expected manufacturing reading from the Dallas Fed, Lee noted.
"If we are rallying on bad news, I think that's a sign that we are probably at a bottom," Lee said.
The market also built on last week's historic rally, where the Dow and S&P 500 posted their best three-day win streaks since the 1930s. With Monday's gains, the Dow is now up 20% from its coronavirus sell-off low reached on March 23 while the S&P 500 has risen more than 17% from those levels. 
Still, the consensus on Wall Street calls for more selling before the market can hit a bottom. Historically, Bear markets are often punctuated by sharp bounces on their way down to a trough.
"Last week's double-digit gain for markets was a welcome relief rally, though market bottoms are rarely as clean as this one has been," said Mark Hackett, Nationwide's chief of investment research. "Markets will need to reflect more traditional interactions before confidence in a bottom can be reached."
Investors continued to grapple with the worsening outbreak in the U.S. as the confirmed cases rose to more than 153,200, according to data from Johns Hopkins University. The U.S. has also officially become the country most affected. Trump said Sunday he hopes the country will "be well on our way to recovery" by June 1.
"We anticipate that market volatility will resist until liquidity, credit, and health risks have demonstrably passed," said Lauren Goodwin, economist and portfolio strategist at New York Life Investments. "With major policy stimulus now in place in the U.S., we expect grim health and social news to dominate the next couple of weeks."

Mar 30, 2020

US Coronavirus' Paycheck Calculator: This calculator tells you exactly how big your coronavirus stimulus check could be

Kathleen Elkins 



The $2 trillion stimulus bill in response to the COVID-19 pandemic was passed by the House on Friday and signed by President Donald Trump.
The plan includes a one-time direct payment to Americans, which Treasury Secretary Steven Mnuchin said should arrive within three weeks. Individuals will receive up to $1,200, married couples will get up to $2,400 and $500 will be added for every child.
There are income restrictions: If you earn more than $75,000 as an individual or $150,000 as a couple, the total amount you’re eligible to receive starts to decrease. If you earn $99,000 or more as an individual or $198,000 as a couple, you aren’t eligible to receive a stimulus check.
To help you figure out how much money you’ll likely receive, Grow, a personal finance website published by CNBC and Acorns, created a calculator that factors in your filing status, annual income and the number of kids you have.

How much could you get in your stimulus check?
Your payment will be based on your most recent tax return. If you’ve filed a 2019 tax return, use that info; if not, use what you filed for 2018. You can find your adjusted gross income on line 8b of the 1040 federal tax form.



You will likely receive a ${{totalStimulus}} stimulus payment.
You will likely not receive a stimulus payment.
Source: 2020 CARES Act
kiersten schmidt/grow

The more you earn, the less money you’ll get. If you earn $75,000 or less as an individual, you’ll get the full $1,200. If you earn more than that, $5 will be subtracted for every additional $100 of income. (The checks phase out completely if you earn $99,000 or more.) The same sliding scale applies for couples earning between $150,000 and $198,000.
Jasmine Mah, who recently graduated with a master’s of science from the University of Leeds, UK, and mathematician Maciej Kowalski created a similar “Stimulus Payment Calculator.” To demonstrate how the payments are calculated, they provide an example of a married couple with two kids. Combined, the couple earns a total of $160,000. They don’t qualify for the full $2,400 because they earn $10,000 over the cap, but they’ll get a reduced check.
To calculate the amount they’ll get, the calculator divides the excess by $100 and multiples that amount by $5. Here’s the formula:
difference = (excess / $100) * $5 
Here’s what the formula would look like for the family of four:
($10,000 / $100) * $5 = $500
That means the family is eligible for $1,900 ($2,400 - $500). Plus, they’ll get another $1,000 — $500 per kid — for a total of $2,900.
When it comes to getting your money, you don’t need to apply for the checks. The money will automatically be transferred directly to the bank account you included in your most recent tax return. If the IRS doesn’t have your direct deposit information, you’ll get a check in the mail.
For more information, check out everything you need to know about the coronavirus stimulus checks.
Don’t miss: Many Americans will get $1,200 stimulus checks—here’s the best way to use it depending on your financial situation
Check out: The best credit cards of 2020 could earn you over $1,000 in 5 years

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