By Powerscourt on 07/10/2020
Powerscourt Coronavirus Briefing – 07 October 2020
Evidence is emerging from scientists that, alongside a battery of poor health outcomes, COVID-19 can impact mental function. You can bet that if politicians can leverage this for their ends, they will.
A study published on Monday in the journal Annals of Clinical and Translational Neurology, based on around 500 people, suggested that up to 80% of people hospitalised with COVID-19 experience some neurological impairment, and that this could survive after they are discharged. The leaders of the US and the UK, after spells as in-patients, may be under even more scrutiny after the report.
President Trump, apparently resurgent after his bout with coronavirus and back in the White House, is tearing up the rules of engagement with the Democrats by ending talks on a planned stimulus package.
Trump on Tuesday announced that he was ending talks on the bill until after the November 3 elections. The stimulus proposal had been a package of measures to send more aid to Americans grappling with high unemployment and to help state and local governments stay afloat as tax collections plummet.
His actions reportedly prompted the House of Representatives speaker, Nancy Pelosi, to suggest to senior House Democrats that the President’s judgement has been impaired by the cocktail of drugs he has been prescribed. The collapse of discussions triggered a slide in the markets.
Boris Johnson, the UK Prime Minister, meanwhile, used a keynote speech at the virtual Conservative Party conference to deny the simmering suspicion that COVID-19 had robbed him of his much-vaunted “mojo”.
“This is self-evident drivel, the kind of seditious propaganda you’d expect from people who don’t want the Government to succeed,” the Prime Minister said.
But the mojo wasn’t in clear evidence on Tuesday as the UK government’s latest attempt to suppress rising infection levels started to unravel.
Local politicians and officials have said that the local lockdowns in place across about two thirds of the UK are not working and that some local restrictions are counterproductive. Leaders in Manchester, Liverpool, Leeds and Newcastle have written to Matt Hancock, the UK health secretary, to say that these interventions have a disproportionate effect on local economies but do little to prevent infection.
Coronavirus is causing huge damage to the UK university sector. Three of the country’s largest institutions, including both of the universities in the UK’s largest student town, Manchester, have now halted face-to-face teaching as coronavirus tears through the student population.
The UK recorded 14,542 new coronavirus infections on Tuesday, a trebling of the figures from a fortnight ago.
The Cabinet is reported to be split over a planned new “traffic light” system, which is to have been announced on Wednesday.
Asian stocks hit a two-week high early Wednesday, brushing off a slide on Wall Street on Tuesday.
WHAT ARE COMPANIES SAYING?
Talk that Britain will soon bring in coronavirus testing at airports provided a dramatic turn in fortunes for investors in Rolls-Royce yesterday. Shares in the jet engine maker enjoyed their biggest daily rise of the century, soaring 26.5p, or 21.6%, higher to 150p – having slumped to a 17-year low only last week. Rolls-Royce has lost more than three quarters of its value this year, with the pandemic tearing through its finances.
Tyman announced this morning that second-half revenue is expected to be slightly down on year and that third-quarter trading has significantly exceeded its expectations, with revenue flat compared with a year earlier. The engineered-components provider said that like-for-like revenue for the third quarter increased 3% and that like-for-like revenue fell 10% to £416.4 million for the nine-month period.
Financials & Real Estate
Assura announced this morning that rent collections in the first half have been in line with normal patterns and that it has disposed of 26 assets in the period for £23 million. The primary care property investor and developer also said it has an immediate development pipeline worth £65 million, which it expects to be on site within 12 months.
Auditors of Seedrs, the equity crowdfunding platform planning a merger with rival Crowdcube, said there was “material uncertainty” over the company’s going concern status in its most recent accounts. KPMG, the accountancy firm, said there was “significant doubt” over Seedrs’ ability to continue trading for the next 12 months, primarily because of fears over the impact of COVID-19 on its business model. Seedrs’ 2019 accounts were published yesterday, a day after the company and Crowdcube announced their merger plans.
Sirius Real Estate
Sirius Real Estate experienced strong cash collection and demand in its first half of fiscal 2021, trading in line with management expectations for the year. The operator of branded business parks in Germany said it has collected 97.2% of the rent for the six months ended 30 September, despite the coronavirus pandemic, and that it expects to continue to collect the outstanding rent over the next 12 months. Total annualised rent roll was €89.2 million for the period, from 78.5 million a year earlier, while the number of enquiries rose by 17.4% year-on-year.
Retail & Consumer
Dozens of stores are to be closed by Clarks as part of a rescue deal worth more than £100 million. The British shoemaker and retailer previously had denied that a company voluntary arrangement was under consideration. However, it is understood that a cash injection by Lionrock Capital, a Hong Kong-based private equity firm, would take place only is a CVA was approved. The deal could involve as many as 50 store closures.
A huge rise in online sales and demand for cooking equipment, storage and home office furniture has helped to cushion Ikea, despite three quarters of its stores closing during the pandemic. Ingka Group, the biggest owner of Ikea stores, yesterday unveiled a 4% decline in sales to €35.2 billion in the year to end of August. The Swedish retail group reported a 60% rise in online sales after 3.6 billion visits to its website, a billion up on last year.
The online women’s fashion brand this morning reported a 52% increase in revenue to £4.3 million against the same period in the prior year. Sales momentum seen in Q1 and July continued into August and September with revenue increasing 7% in July and 54% from August to September. The revenue growth in the half represents a strong performance in a challenging environment, with initial trading with John Lewis and Next being promising and the initial ranges already expanding.
Tesco today reported a 6.4% surge in UK supermarket profits in the first half of the year as shoppers flocked to buy groceries online during the COVID-19 pandemic and stayed away from restaurants. Underlying UK retail profits were boosted to £1.19 billion for the period and food sales shot up 9.2%. Despite clothes sales falling 17%, overall group international sales gained 6.6% at £26.7 billion. The supermarket giant also announced it had hired a new finance director, Imran Nawaz, the Tate & Lyle FD.
Nuformix has announced that it raised £650,000 in a discounted share offer and is looking to recruit a chief executive officer. The drug re-purposing specialist placed 23.2 million new shares at a price of 2.8 pence, representing a 15% discount to the 3.3 pence closing price on Tuesday. The money will be used to strengthen its data packages for treating the effects of COVID-19, to maximise opportunities for its development pipeline, and to recruit a CEO and non-executive directors.
IN THE NEWS
Construction sector lifted by property market revival – THE TIMES
Bank lending soared as coronavirus pandemic struck – THE TIMES
Airlines hope COVID-19 health pass will have passengers flying again – FINANCIAL TIMES
Cabinet split over tougher COVID lockdown measures – THE DAILY TELEGRAPH