(Bloomberg) — The U.S. central bank on Tuesday will start purchasing eligible exchange-traded funds invested in corporate debt, bringing a key part of the Federal Reserve’s emergency lending program online.
Japan is accelerating its review of potential treatments for Covid-19 as Prime Minister Shinzo Abe faces criticism for planning to exit a state of emergency. President Donald Trump said “we have prevailed” as U.S. deaths from the coronavirus exceeded 80,000, a remark he later said pertained only to testing for the infection.
Wuhan, the epicenter of the pandemic, reported its first new infections since the Chinese city ended its lockdown last month. The Philippines will extend some lockdowns scheduled to expire May 15 because it can’t afford another wave of infections, the president said.
Key Developments:
- Virus Tracker: Cases top 4.17 million; deaths exceed 286,300
- Federal Reserve to begin buying corporate debt
- Boeing CEO says a major carrier “most likely” will fold
- An overview of Japanese carmakers’ plant closures
- South Korea fighting new outbreak from nightclubs
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South Korea’s Virus Strategy Tested by Nightclub Outbreak (11:24 a.m. HK)
The “come forward, get tested” strategy that’s helped South Korea contain the coronavirus has run into an obstacle: its homophobia.
Following an outbreak linked to clubs, several of them frequented by gay customers, health officials are trying to track more than 5,500 people who visited the bars between April 24 and May 6. But more than half remain out of reach, while the infections tied to the bars continue to rise.
On Tuesday morning, Seoul’s mayor said 101 confirmed cases have been linked to the nightclubs, up from 86 yesterday.
Federal Reserve to Start Buying Corporate-Debt ETFs (11:04 a.m. HK)
The Federal Reserve said a facility designed to purchase eligible corporate debt from investors will launch Tuesday, bringing a key part of the U.S. central bank’s emergency coronavirus lending program online.
The Secondary Market Corporate Credit Facility will begin purchasing eligible exchange-traded funds invested in corporate debt, the New York Fed said on its website. It was first announced in March and has played an important role in keeping financial markets relatively calm since.
Congress allocated $454 billion in equity to backstop the Fed loans as part of the $2 trillion-plus economic relief package passed in March.
Abe Speeds Approval of Unproven Virus Drugs (9:45 am HK)
Prime Minister Shinzo Abe’s government is following the U.S. in speeding up the approval of unproven virus drugs, as he faces new criticism over his plan for exiting a state of emergency and reviving Japan’s economy.
Regulators — which usually take a year for drug approvals — authorized the use of Gilead Sciences Inc.’s remdesivir just three days after receiving the application. Abe also said Fujifilm Holdings Corp.’s anti-viral drug Avigan, a treatment he long has cited in public remarks, was in line for clearance by May 31.
Japan is only the second country to approve the use of remdesivir after the U.S. The drug originally was intended to treat Ebola.
Some Philippine Areas to Remain Under Lockdown (9:15 a.m. HK)
President Rodrigo Duterte said some areas in the Philippines will remain on lockdown as the nation can’t afford to have another wave of coronavirus infections.
Duterte, at a briefing aired Tuesday, said areas with high infection rates will remain under stay-at-home orders beyond their original May 15 end date. He didn’t identify those areas.
The capital region of 13 million people and nearby central and south Luzon areas have been on lockdown since mid-March, an order extended twice already.
Democrats Consider Convention Changes (7:58 a.m. HK)
The Democratic National Committee will decide whether to give convention organizers free rein to make whatever changes are necessary to “protect the public safety” amid the coronavirus pandemic, and that includes changing the format and date of the event, scheduled to begin on Aug. 17 in Milwaukee.
Former Vice President Joe Biden is the presumptive Democratic presidential nominee.
A resolution will be voted on Tuesday by the Rules and Bylaws Committee before going to all DNC members for a vote.
Malaria Drug Fails to Stop Covid in New York (6:39 a.m. HK)
A malaria drug touted by President Donald Trump as a coronavirus treatment failed to help patients in New York City successfully fight off the pathogen, both when used alone or with an antibiotic, researchers and public health officials said.
Patients given hydroxychloroquine were more likely to die, especially if they were also treated with the antibiotic azithromycin, than those were weren’t given either drug, though they were also sicker and had more health problems to start, according to the report in the Journal of the American Medical Association. The differences were no longer meaningful once the doctors took into account the severity of the disease.
The findings from researchers at the University of Albany School of Public Health and the New York State Department of Health confirm numerous other reports that examined the medication, which was initially and vociferously backed by Trump based on preliminary results from a French study that has since drawn criticism. The review of medical records from 1,438 hospitalized patients in New York City found cardiac arrest was more common in those getting both medications.
The U.S. Food and Drug Administration since warned against its unrestricted use, citing potential toxic effects for the heart.
Trump Says ‘We Have Prevailed’ (5:30 p.m. NY)
President Donald Trump declared at a White House news conference on the coronavirus outbreak that “we have prevailed,” as U.S. deaths from the disease exceeded 80,000 — a remark he later said pertained only to testing for the infection.
“Thanks to the courage of our citizens and our aggressive strategy, hundreds of thousands of lives have been saved,” Trump said. “In every generation, through every challenge and hardship and danger, America has risen to the task, we have met the moment and we have prevailed.”
Asked later about his remark that the U.S. had “prevailed,” Trump said he was only talking about testing for the virus. The U.S. didn’t exceed 100,000 coronavirus tests performed until March 19, according to data compiled by the Covid Tracking Project, but more than 300,000 tests were conducted daily on Thursday, Friday and Saturday.
White House Orders Staff to Wear Masks (4:40 p.m. NY)
The White House ordered everyone entering the West Wing to wear a face mask after Vice President Mike Pence’s press secretary tested positive for the coronavirus last week. The announcement was made in a memo addressed to staff on Monday, according to two people, and it said employees didn’t need face coverings while working at their desks.
“Staff who sit in the West Wing are not required to wear a facial covering while at their desk if they are appropriately socially distanced from their colleagues,” the memo from the White House Management Office reads.
“Unless you absolutely need to conduct in-person business in the West Wing, we respectfully ask you to avoid unnecessary visits,” it added.
U.S. to Distribute $11 Billion in Test Funding (4:30 p.m. NY)
The Trump administration plans to distribute $11 billion to states for coronavirus testing, according to senior administration officials.
The money is part of the CARES Act stimulus package. It will be distributed under a formula that reflects the burden of Covid-19 as well as population-based estimates, the officials said. The administration plans to release details about the distribution in the next day or two, the officials said.
Twitter to Tag Misleading Virus Posts (1:55 p.m. NY)
Twitter Inc. will label some misinformation that’s confusing or misleading, increasing the likelihood that more Covid-19 tweets will be marked or taken down. Previously, Twitter reserved that for posts posing a direct threat to safety. The new label will apply to tweets that are “less severe” but “where people may still be confused or misled,” the company said in a blog post.
Twitter, like Facebook Inc., has been trying to curb the spread of incorrect data and misleading material, relying on public health authorities to determine what may be misleading.
N.Y. to Start Some Reopenings Friday (1:04 p.m. NY)
Certain businesses in New York state — including construction, curbside retail, drive-in movie theaters and some recreational activities — will reopen this week on a regional basis, Governor Andrew Cuomo said. Each area will have to meet seven criteria, including low rates of virus-related hospitalizations and having certain testing and tracing measures in place. There will be control rooms to monitor each area’s reopening, ensuring they meet the metrics, the governor said in his daily briefing.
Cuomo has said it would be a “miracle” if hard-hit New York City were ready to reopen on May 15. Earlier today, Mayor Bill de Blasio said the city’s lockdown is likely to continue into June.
Risk of Transmission Will Rise Again: WHO (1 p.m. NY)
As countries ease restrictions and people mix more, the risk of transmission will rise again, said Mike Ryan, head of the World Health Organization’s health emergencies program. The question is whether countries can identify and isolate clusters of cases so the transmission doesn’t reach previous rates, he said.
“Shutting your eyes and trying to drive through this blind is about as silly an equation I’ve seen,” Ryan said. “I’m really concerned that certain countries are setting themselves up for some seriously blind driving over the next few months.”
Ryan also said the idea that countries with lax measures will “all of a sudden magically reach some herd immunity” is a “really dangerous calculation” as it would involve many deaths.
“People are growing tired, we understand, but we need to have people stay with us,” said Maria Van Kerkhove, the WHO’s technical lead on Covid-19.
Wear Face Masks for Long Haul: U.K.’s Johnson (9 a.m. NY)
Britons should wear face coverings in enclosed spaces and prepare for a different kind of normal that may last for a year or more, Boris Johnson’s government said as he published a road map for the national recovery from coronavirus.
Johnson said social-distancing measures are likely to be needed for the foreseeable future, with people continuing to work from home where they can, until a vaccine or drug treatment can be found. The government aims to allow shops to reopen next month and pubs after July 4.
Among the options under consideration is the idea of allowing households to mix, potentially forming “bubbles” with another household. That would allow two households to share childcare, helping parents go back to work, the document said.
