U.S. hits 1 million coronavirus cases as Spain and France prepare to reopen

France plans to begin reopening shops on May 11, while Spain is preparing for a “new normal” as Europe’s most hard-hit nation removes restrictions over the next eight weeks. Cases in the U.S. surpassed 1 million, according to data compiled by Johns Hopkins University.

The number of new infections in Germany fell below 1,000 for the first time in more than five weeks. China’s top scientists said the virus won’t be eradicated, joining a growing consensus that the pathogen will probably return in waves.

New York City reported a decline in the number of people admitted to hospitals for the new coronavirus, while the state’s governor, Andrew Cuomo, laid out criteria necessary for some upstate regions to reopen. President Donald Trump plans to order meat-processing plants to remain open, a person familiar with the matter said.

FAUCI ‘CAUTIOUSLY OPTIMISTIC’ ON VACCINE

The U.S. government’s top infectious disease specialist is “cautiously optimistic” scientists will develop a Covid-19 vaccine that can protect against future outbreaks of a virus he said is unlikely to disappear.

“The very fact that people can mount a natural immune response that gets rid of the virus in them makes me cautiously optimistic that we can develop a vaccine that can mimic natural infection enough to induce that same sort of response that would ultimately protect people,” Anthony Fauci said today at a virtual event hosted by the Economic Club.

Fauci, director of the National Institute of Allergy and Infectious Diseases, in the past has shied away from making predictions about treatments.

TEXAS CASES RISE 3.5%

Texas cases rose 3.5% to 26,171, almost in lockstep with the rate of increase in testing, according to the state’s health department. Hospitalizations climbed by 119 to 1,682, or 19% higher than a week ago.

The increases in caseload and admitted patients come as Governor Greg Abbott moved to reopen the economy and leaders of the state’s biggest metropolitan areas warned that moving too fast could ignite a second wave of contagion.

SPAIN AIMS TO LIFT LOCKDOWN IN 8 WEEKS

Spain aims to remove most restrictions on daily life and return to a “new normal” over the next eight weeks, Prime Minister Pedro Sanchez said.

The process will be subject to data on the number of Covid-19 infections and won’t follow a strict calendar, Sanchez said in a televised address. Schools won’t return until September. Each province will ease curbs on activity at its own pace in accordance with its particular situation, Sanchez added.

After a six-week lockdown that has crippled the economy, the health ministry earlier reported a drop in the number of new virus cases and deaths, continuing a trend of steady decline in the nation with Europe’s most extensive outbreak.

Turkish ICU Cases Fall for Fifth DayThe number of coronavirus patients requiring intensive care fell for a fifth day across Turkey, while the tally of patients discharged from hospitals rose to the highest since the outbreak began 50 days ago.

The total figure for confirmed cases now stands at 114,653, or 2.1% higher than Monday, Health Minister Fahrettin Koca said in a Twitter post. The ministry reported 92 new fatalities, bringing the death toll from the outbreak to 2,992.

U.K. REPORTS 586 MORE DEATHS

A further 586 people are reported to have died from the coronavirus in U.K. hospitals, the government said.

That’s an increase from the 360 deaths reported Monday, but U.K. death numbers are usually artificially low after a weekend.

Some 3,996 more people tested positive for the disease, down from an increase of 4,310 the day before, according to figures given by Health Secretary Matt Hancock today. The U.K. now has more confirmed cases than Germany, and the fifth-highest number of confirmed cases in the world.

PUTIN EXTENDS RUSSIAN LOCKDOWN

President Vladimir Putin ordered Russians to remain under lockdown through May 11 after the total number of coronavirus cases in the country surpassed China’s.

“We have been able to slow down the epidemic,” Putin said today in a videoconference with officials and regional governors. “The peak has not yet been reached. We are facing the most intense stage of the fight against the epidemic.”

Putin also ordered the government to prepare a plan for gradually lifting the virus restrictions starting as early as May 12, and said ministers should draw up further programs to support the economy. Easing the measures against the epidemic won’t happen all at once, the president said.

Florida Governor to Meet With Trump

Florida reported 32,846 Covid-19 cases today, up 2.2% from a day earlier. Deaths reached 1,171, an increase of 7.6%. Governor Ron DeSantis is in Washington today to meet with President Donald Trump, an ally — and technically a Florida resident — to whom DeSantis has frequently turned for guidance during the pandemic.

NYC SEES DROP IN VIRUS ADMISSIONS

New York City reported a decline in the number of people admitted to hospitals for the new coronavirus, to 112 from 122 as of April 25.

The number of people in New York City Health + Hospitals intensive-care units also declined, to 745 from 766 as of April 25, according to figures presented by Mayor Bill de Blasio at his today virus briefing.

In another sign of progress, de Blasio reported that the citywide percentage of people who tested positive for Covid-19 is 27%, down from 29%. Testing positivity was slightly higher at the public health lab, up to 56% from 55%.

FRANCE TO REOPEN SHOPS STARTING MAY 11

Prime Minister Edouard Philippe said a decision on whether to reopen restaurants and cafes will be examined at the end of May, and that pupils can start returning to school from May 11 but with strict rules. Public events of more than 5,000 people are outlawed until September, and working from home is encouraged for at least three more weeks, he said.

Ford to Restart Production at European Plants

Ford intends to restart initial production at most of its main European vehicle and engine plants beginning May 4, the company said. Manufacturing will resume in a phased approach, and employees will receive personal-care kits including masks and thermometers.

MNUCHIN SAYS LOANS OF $2 MILLION TO BE AUDITED

U.S. Treasury Secretary Steven Mnuchin said all loans of more than $2 million in a government relief program for small businesses will be audited to ensure they were justified after large public companies and big chains sparked outrage by taking funds.

Mnuchin said the loans of as much as $10 million meant to keep workers on payrolls under the Paycheck Protection Program were intended for small firms that lacked access to other capital, and the U.S. Small Business Administration will check that borrowers who took large loans properly certified it was needed because of the coronavirus outbreak.

“I want to be very clear it’s the borrowers who have criminal liability if they made this certification and it’s not true,” Mnuchin said today on CNBC.

The Treasury secretary also said those states that had poorly managed budgets before the Covid-19 outbreak shouldn’t be rescued by the federal government.

U.S. MERCHANDISE TRADE SLUMPS

U.S. exports and imports of goods slumped in March to the lowest level in almost three years as the coronavirus pandemic shut down economies across the world.

Goods exports fell 6.7% from the prior month — the sharpest decline since 2008 — led by plunges in auto shipments and industrial supplies such as oil, according to Commerce Department data released today. Imports fell by 2.4% on autos and consumer goods. Combined, U.S. exports and imports were the lowest since May 2017.

GERMANY TO EXTEND TAKEOVER CONTROLS TO HEALTH CARE

The German government plans to extend its protection against foreign takeovers to the health-care industry after the coronavirus outbreak made companies more vulnerable. Angela Merkel’s cabinet aims to lower the threshold for scrutinizing investments in the sector from outside the European Union, the Economy Ministry said today.

NETHERLANDS SEES FEWEST NEW CASES SINCE MARCH 14

The Netherlands reported 171 new cases, the lowest since March 14, which was a few days before an “intelligent lockdown” was imposed on the country. Confirmed cases rose a mere 0.4% to 38,416, marking the lowest recorded growth rate. Fatalities increased by 48 — five more than Monday, but still below the triple-digit numbers seen for most of the month — for a total of 4,566.

FDA’S HAHN OPTIMISTIC ABOUT PLASMA TREATMENT

“There are some good preliminary data to suggest that it is a benefit, this is a therapy that we’ve been scaling up over the last two months,” FDA Chief Stephen Hahn told Fox Business. On Gilead and its drug remdesivir, he said: “We’ve been in very close contact with the company and are working closely with them to look at what those data show”

U.K. REGULATOR WARNS BANKS NOT TO USE LOANS TO WIN DEALS

“We have heard credible reports of a small number of banks failing to treat their corporate clients fairly when negotiating new or existing debt facilities,” the Financial Conduct Authority said today in the letter. “We have heard reports that banks may have used their lending relationship to exert pressure on corporate clients to secure roles on equity mandates.”

Providing financial services in return for future business is not an unusual strategy for lenders. The outbreak of the Covid-19 virus triggered an unprecedented demand for banks to provide short-term liquidity and prompted regulators to ease capital buffers. The transactions could include a capital raising, a bond issuance or other types of equity mandates.

EUROPEAN BANKS GET BREAK ON LEVERAGE LIMITS

A key rule on banks’ indebtedness — the so-called leverage ratio — will be relaxed under a European Union proposal announced today, enabling banks to hold less capital for funds they keep at central banks. Deutsche Bank AG, which had 134 billion euros in cash primarily at central banks at the end of 2019, stands to be a major beneficiary.

The softening of the rule is part of the latest plan unveiled by the European Commission, the EU’s executive arm, that also would allow banks to save on capital when they invest in software and when they fund infrastructure and small- and medium-sized businesses

SINGAPORE VIRUS TREND ‘IMPROVING’

The trend of overall cases is “indeed improving” but the government wants to make sure there is a decisive reduction in local community transmission before moving to relax circuit breaker measures, Singapore Minister for National Development Lawrence Wong said at a briefing.

As part of the city-state’s strategy to bring down infections in the weeks to come, the government said it has more than doubled its daily testing capacity since early April even as the number of cases. Once touted as an early success in containing the spread, Singapore now has Asia’s highest number of coronavirus cases after China and India. Much of the surge in infections has been driven by hundreds of new daily cases from migrant worker dorms.

UPS, PEPSICO PULL OUTLOOK

UPS, PepsiCo, 3M and Xerox joined the growing list of companies who have scrapped forecasts because of the disruption caused by the coronavirus. “There is still a great deal of uncertainty that exists in relation to Covid-19, including how geographies, retail channels and consumer behaviors will evolve over time,” PepsiCo said. UPS is suspending share buybacks for 2020 and expects capital expenditure to be about $1 billion lower than expected.

At 3M, rising demand for cleaning supplies, food-safety products and even home-improvement items helped propel sales and profit above expectations for the first quarter.

Caterpillar Inc. didn’t provide an outlook for the year and said it had taken actions to cut costs, including reducing discretionary expenses and suspending 2020 base salary increases and short-term incentive compensation plans for many employees and all senior executives. Harley-Davidson Inc. is in talks with major U.S. banks to secure $1.3 billion in funding after sales declined in every market worldwide

Southwest Airlines Co. plans to sell $1 billion in convertible bonds and 55 million shares. The company is cutting the number of Boeing Co. 737 Max jets it will take through December 2021 by more than half as the travel outlook remains bleak. Max deliveries will total no more than 48 through the end of next year as the pandemic batters demand for flights, Southwest said. More than 120 planes had been expected.

Smithfield Foods Owner Sees Unprecedented Challenges (5:57 p.m. HK)

WH Group Ltd. said it faces unprecedented challenges as the pandemic closes its plants in the U.S. and slows global demand. Five of the company’s processing and packaged plants in the U.S. are temporarily closed.

Plant shutdowns are leaving Americans dangerously close to seeing meat shortages at grocery stores. Meanwhile, farmers are facing the likely cull of millions of animals and mass graves could soon be dug across the heartland. “The food supply chain is breaking,” said John Tyson, chairman of Tyson Foods Inc., the biggest U.S. meat company.

LUXEMBOURG STARTS LARGE-SCALE TESTING

Luxembourg, a nation of about 600,000 people, is starting a new phase of large-scale testing to understand better how the virus is developing and to adapt national measures accordingly. The goal is to be able to test some 20,000 people a day as of May 19, the government said today.

The project, which will cost about 40 million euros ($43 million), will help create certainty that it’s safe to relax some of the confinement measures. By testing teachers and pupils from next week, schools can safely reopen as planned over the course of May as well, said Education and Research Minister Claude Meisch.

BELGIAN HOSPITALIZATIONS AT SIX-WEEK LOW

Belgian health officials reported 123 new hospital admissions in the past 24 hours, the lowest since mid-March and down from 127 the prior day. The number of patients treated in intensive care units fell by 27 to 876. Virologists would like to see that ICU total drop to less than 500 before giving the go-ahead for store re-openings now planned on May 11 in Belgium’s exit plan from a partial lockdown. Reported fatalities on Monday rose to 134 from 113 on Sunday, taking the total to 7,331. Hospital deaths account for only 46% of Belgium’s death toll.