Coronavirus

Airlines need surgery not a vaccine

14 Jul 2020

Delta’s CEO said business travel, recently half its revenue, may never fully recover. That suggests the health crisis is turning into a full-fledged shift in behavior. The U.S. government could re-up bailouts. But the industry needs to shrink and rethink to stay airborne.

The Exchange: Managing through the corona crisis

14 Jul 2020

As companies grapple with the pandemic’s fallout, consulting firm AlixPartners has a close-up view inside boardrooms. CEO Simon Freakley discusses priorities for troubled businesses, the long-term impact of Covid-19 and what he has learned running a global business by video call.

Corona Capital: Lockdown diets, Beating the Fed

14 Jul 2020

Concise views on the pandemic’s corporate and financial fallout: Covid-19 is prompting diets for both animal and human; and the Fed takes a hit on a garbage deal.

U.S. stock investors look past Covid-19 nadir

13 Jul 2020

The second-quarter reporting season is kicking off. Analysts expect a 44% year-on-year decline for S&P 500 earnings. With the index roughly flat for 2020 and tech stocks riding high, for some the coronavirus is in the rearview mirror. Whether it stays there is another question.

Virus binge gives hedgies easy prey in testing M&A

13 Jul 2020

Davidson Kempner wants Thermo Fisher Scientific to up its $11.5 bln bid for peer Qiagen. The German group’s business is improving as governments use its kits to fight the coronavirus. The recent rally in diagnostic stocks, and potential counterbids, mean there is little to lose.

Corona Capital: Ice hockey

13 Jul 2020

Concise views on the pandemic’s corporate and financial fallout: The National Hockey League and its players make the kind of deal Major League Baseball sluggers and owners should have been pitching for.

American Airlines has jumbo-sized seating dilemma

10 Jul 2020

The Dallas-based carrier’s un-socially distanced cabins have displeased passengers and health officials. But a look at its finances suggests the alternative would be big losses. It’s hard to see how American can please the many people who have stumped up to keep it airborne.

Corona Capital: Mets star bidders, Robot slayers

10 Jul 2020

Concise views on the pandemic’s corporate and financial fallout: Power couple J. Lo and A-Rod are giving hedge fund manager Steve Cohen competition for the New York Mets baseball team; Covid-19 is accelerating automation of the meat industry.

Gold’s enduring high gives miners room to be bold

10 Jul 2020

Bullion has breached $1,800 per ounce amid fears of a viral surge. Mine bosses’ enthusiasm to develop lower grade reserves that only make sense at exalted price levels is usually dampened by worries of a sharp snapback. An extended Covid-19 tail means more will take the chance.

DiaSorin offers rare bright spot in Italian gloom

10 Jul 2020

The $11 bln company’s Covid-19 kits may not be as iconic as Prada bags or Ferrari cars. But they sell like hot cakes in a pandemic. If the virus wanes, so will its tests' appeal. Still, DiaSorin’s biotech focus is a step-up from traditional Made in Italy products.

Chancellor: Wall Street is firmly in Wonderland

9 Jul 2020

As society melts down, markets melt up. The constant manipulation of interest rates has turned the world of finance upside down. Serious investment has become impossible. It’s the sort of topsy-turvy state Lewis Carroll might have imagined if Alice was putting money to work.

Corona Capital: Nursing homes, Airlines, Walgreens

9 Jul 2020

Concise views on the pandemic’s corporate and financial fallout: Nursing home investments will get a rethink; airline travelers get the upper hand; and Walgreens’ LBO heyday is in the past.

SAP will struggle to walk, chew gum at same time

9 Jul 2020

The $190 bln software group is weathering the Covid storm: CEO Christian Klein kept sales rising while also slashing costs. Yet keeping up with fast-growing U.S. rivals like Salesforce requires investment. That implies a margin hit, and disappointment for cash-hungry investors.

Rolls-Royce flies closer to credit-card max-out

9 Jul 2020

The British jet engine maker led by Warren East incinerated 3 bln pounds in the last six months due to aviation lockdowns. At least another 1 bln may disappear in the next. Extra credit lines look increasingly like bandages over a balance sheet in need of serious surgery.

Uniqlo is well-tailored for an Asia-led recovery

9 Jul 2020

Fast Retailing cut its annual operating profit forecast but the recovery is robust in its top two markets, China and Japan. It underpins a stock rally that has outpaced rivals Inditex and H&M, and justifies a premium valuation. It also dresses up a bumpy overseas expansion.

Indonesia cautiously crosses central bank rubicon

9 Jul 2020

Bank Indonesia will buy $28 bln of bonds directly from the government, breaking a long-held taboo. It will refund interest gains, and the securities will be tradeable, providing price transparency. That’s about as credible as an emerging market monetary authority can hope to be.

Twitter and Walmart show signs of subscriber envy

8 Jul 2020

Both the social network and the $360 bln retailer are considering offering users extra bells and whistles in return for subscriptions. After all, that has worked for companies like Spotify, Netflix and the New York Times. But it’s not only customers who could end up paying.

UK’s Sunak hits right target with latest Santa act

8 Jul 2020

Finance minister Rishi Sunak unveiled new stimulus worth up to 30 bln pounds. A tax cut for homebuyers and restaurant subsidies might help. But his best ideas encourage employers to retain workers and hire young people. Avoiding a scarring of the jobs market is vital to recovery.

Hadas: A virus economic optimist partly recants

8 Jul 2020

Three months ago, it felt bold to predict little lasting damage from the pandemic. Money-fuelled markets have embraced that outcome, but pumped-up hopes are now too high. Global finance is undisciplined, fear and bitterness lurk, and governments may have gained too much power.

Corona Capital: Not so united

8 Jul 2020

Concise views on the pandemic’s corporate and financial fallout: A potential round of cuts at United Airlines lays bare the pitfalls of the government being both savior and investor.