By Ciara Linnane, MarketWatch
The U.S. death toll from the coronavirus that causes COVID-19 climbed above 81,000 on Tuesday, as President Donald Trump, defending his record on testing in the U.S., ended his White House news conference abruptly following an angry exchange with two reporters.
At his first briefing since April 27, Trump said the U.S.’s testing capacity is “unmatched and unrivaled anywhere in the world,” with more than 9 million tests now completed. Trump said that number will exceed 10 million by the end of the week. States will be getting $11 billion from recently approved legislation to put toward testing, according to a senior administration official who briefed reporters on Monday.
But critics say the federal government’s delayed approach to testing, faults with initial batches of tests prepared by the Centers for Disease Prevention and Control, and a failure to create a centralized testing system that could be rolled out across the country have hurt the effort to contain the virus.
Joe Biden, the presumptive Democratic presidential nominee, said in a Washington Post op-ed on Monday that testing has been inadequate and urged the administration to do more.
The nonprofit organization Accountable.US has launched a website called WhereAreTheTests.com to highlight the failings on testing. The website includes internal emails from the organization’s 50 States Open Records Project, showing states struggling to obtain testing supplies from the federal government.
“The Trump administration has mismanaged the single most important element of the response to this public health crisis,” said Accountable.US President Kyle Herrig in a statement. “Public health officials agree: without widespread testing, there is no way states can reopen safely. We intend to expose this administration’s unfulfilled promise and the detrimental impact this lack of available testing is having across the county.”
Even as case numbers are still climbing, Trump has been pushing states to reopen their economies, which public health officials and governors say can only be done safely with mass testing and contact tracing, a method that has worked well in South Korea and Germany.
The Chinese city of Wuhan, where the outbreak was first reported late last year, is planning to test its entire population of 11 million people in the next 10 days, according to Chinese media reports. that were cited in a Fortune magazine report. That’s after a handful of new cases emerged in the last several days, the first to appear since the city lifted its lockdown on April 8.
One example of the problem a shortage of testing is causing can be found in Colorado’s Weld County, where the chief health officer resigned after coming under pressure from elected officials when he tried to persuade them to temporarily close down a JBS USA meatpacking plant because workers had become sick, as MarketWatch’s Matt Smith reported.
Emails obtained using a series of Colorado Public Records Act requests, show the officer pleading for help with testing and other resources, while also trying to get the plant to protect its workers. The story offers a case study into the country’s approach to the crisis, in which much of the responsibility for setting policy with regard to the pandemic and dealing with the fallout has landed on relatively low-level local officials whose decisions often have national implications, Smith wrote.
Three key members of Trump’s coronavirus task force are testifying to a Senate committee on the pandemic management. Dr. Anthony Fauci, the head of the National Institute of Allergy and Infectious Diseases; Dr. Robert Redfield, director of the Centers for Disease Control and Prevention; and Stephen Hahn, commissioner of the Food and Drug Administration, are testifying remotely after being forced into quarantine following exposure to infected White House staffers.
Fauci is expected to warn the Senate that the U.S. risks “needless suffering and death” if the economy reopens too soon, the New York Times reported Monday night.
There are now 4.23 million global cases of COVID-19, and 289,349 people have died of it, according to data aggregated by Johns Hopkins University. More than 1.48 million people have recovered.
The U.S. has the highest case toll at 1.36 million and the highest death toll at 81,571.
Russia overtook Spain in terms of numbers of cases following another spike in infections. Russia now has 232,243 cases and 2,116 deaths. The U.K. has 227,736 cases and 32,769 deaths, the highest death toll in Europe.
Spain moves to third place by case number with 227,436 cases and 26,744 deaths.
Italy has 221,216 cases and 30,911 deaths. France has 177,547 cases and 26,994 deaths. Germany has 172,812 cases and 7,693 deaths.
Brazil has 172,243 cases and 11,980 deaths. Turkey has 141,475 cases and 3,894 deaths. Iran has 110,767 cases and 6,733 deaths. China has 84,011 cases and 4,637 deaths.
New York remains the U.S. epicenter with 342,267 cases and 27,003 deaths, according to a New York Times tracker.
What’s the latest medical news?
There was positive news for biotech Novavax Inc. (NAS:NVAX) , after it received $384 million in funding to develop its COVID-19 vaccine candidate. The award came from the Oslo-based Coalition for Epidemic Preparedness Innovations for the development of NVX-CoV2373. Funding will be used for combined safety and effectiveness testing of the vaccine. The stock was up 54% on Tuesday.
Laboratory Corp. of America Holdings (NYS:LH) expanded its at-home COVID-19 test to the general public. The at-home test, which received emergency-use authorization from the Food and Drug Administration on April 20, was initially made available to frontline workers. Individuals who have been exposed to or have symptoms of COVID-19 can collect samples at home using nasal swabs and then mail them to a lab.
Moderna Inc. (NAS:MRNA) said it had received a fast-track designation from the Food and Drug Administration for its COVID-19 vaccine candidate. Moderna has completed the Phase 1 clinical study for the vaccine and has said it is preparing for the midstage trial, which will begin “shortly” and is expected to enroll up to 600 participants.
What are companies saying?
Tesla Inc. (NAS:TSLA) Chief Executive Elon Musk continued his attack on county officials in California’s Alameda County by reopening his Fremont plant beyond the minimal operations they are allowing, as MarketWatch’s Claudia Assis reported.
Alameda is one of the six San Francisco Bay Area counties under a regional shelter-in-place order set to expire May 31.
County health authorities said in a statement late Monday they have learned the plant has reopened beyond basic maintenance, and that they have notified Tesla it could only maintain minimal operations until an approved plan is in place.
In a tweet, Musk said: “If anyone is arrested, I ask that it only be me.” Musk has railed against the lockdown and restrictive measures since they were imposed, called them “fascist” on his recent earnings call and threatened over the weekend to move the plant out of California.
The Fremont factory employs more than 10,000 people.
The chief executive of Boeing Co. (NYS:BA) told NBC’s “Today” show that a major airline will “most likely” go out of business as a result of the pandemic. David Calhoun said airlines won’t be back to even 25% business by the autumn, and “maybe by the end of the year we approach 50 [percent].” He predicted that it would take the industry three to five years to recover to pre-pandemic levels.
The chief executive of Restaurant Brands International Inc., parent to Burger King, Tim Horton and Popeyes, outlined how the restaurant industry will need to adapt to the new normal. In an open letter, Jose Cil said his company’s restaurants are reopening with a range of public-safety measures designed to protect staff and customers from COVID-19.
The company has introduced acrylic shields and contactless service at most restaurants, and is maintaining social-distancing using tabletop signage to indicate which tables are open and which reserved.
Elsewhere, companies continued to bolster liquidity by issuing bonds or convertible bonds, to withdraw financial guidance because of uncertainty and to rein in costs and spending to preserve cash.
Here are the latest things companies have said about COVID-19:
• Arlo Technologies Inc. (NYS:ARLO) topped Wall Street estimates but the security-camera maker issued a lower-than-expected outlook because of COVID-19 disruptions. “While our supply chain and internal teams are largely at full force, we are seeing disruptions in our distribution channels that impede our ability to serve our customer in the near term,” said Matthew McRae, Arlo’s chief executive, in a statement. Arlo expects an adjusted loss of 46 cents to 39 cents a share on revenue of $50 million to $60 million for the second quarter, while analysts had forecast a loss of 31 cents a share on revenue of $70.7 million. The company is pulling its guidance for the year.
• Casper Sleep Inc. (NYS:CSPR) reported a first-quarter loss that narrowed, but not as much as expected, while revenue rose above forecasts, as the pandemic led to store closures but a boost in direct-to-consumer sales. To mitigate the effects of the pandemic, Casper has furloughed or cut about 80 employees, or 21% of its workforce, started the wind-down of its European operations last month, and expects that to be mostly completed by the end of the year. The company observed “certain favorable developments” in results since the end of March, but added there was no guarantee that those trend will continue. Given the uncertainty associated with the pandemic, Casper said it would not provide full-year financial guidance.
• Cloudflare Inc. (NYS:NET) is offering $500 million of convertible senior notes that mature in 2025 in a private offering. Proceeds will be used to cover the cost of capped call transactions that aim to reduce the dilution of shares upon conversion, as well as for general corporate purposes. The notes will be convertible into cash, shares of Class A common stock or a combination of the two.
• Eventbrite Inc. (NYS:EB) reported revenue and net income for its first quarter that missed Wall Street estimates. With the shutdown of all major live events because of COVID-19, the San Francisco–based company announced a reduction of 45% of its 1,000 employees in early April. On Monday, Eventbrite secured financing with Francisco Partners of up to $225 million.
• Grocery Outlet Holding Corp. (NAS:GO) topped Wall Street expectations for its adjusted quarterly profit and said stockpiling in the current quarter has offset a decline in foot traffic amid the pandemic. Comparable-store sales rose 17%, compared with a 4.2% increase in the same period last year, the company said. So far in the current quarter, same-store-sales growth is tracking at a percentage in the midteens, thanks to “increase in average basket size partially offset by declines in store traffic due to shelter-in-place restrictions,” Grocery Outlet said. “The impact of the COVID-19 situation remains fluid and therefore it is difficult to predict the impact of potential changes to shelter-in-place restrictions.” The company did not provide official earnings guidance, but said its “performance and liquidity position remain strong, allowing us to continue investing in pursuit of our long term growth strategies.”
• Hertz Global Holdings Inc. posted a wider-than-expected first-quarter loss, saying that results were “significantly impacted by [the] COVID-19 pandemic.” The year started well, Hertz Chief Executive Kathryn V. Marinello said in a statement. “Yet in just two months, the outbreak of the coronavirus created a major business disruption as global travel demand dropped to almost zero and the U.S. used-car market effectively shut down. We immediately shifted our business priorities to focus on employee and customer safety, expense mitigation and preserving liquidity,” she said. Hertz drew down $595 million from a credit line and ended the period with about $1 billion in cash and cash equivalents. Hertz reportedly has hired advisers to guide it about its debt load and ahead of a possible bankruptcy filing.
• Hilton Grand Vacations Inc. (NYS:HGV) has agreed an amendment to its $1 billion credit agreement to provide it with greater flexibility during the coronavirus pandemic. The amendment offers near-term covenant relief with changes to covenants related to financial maintenance, incurrence of debt, investments in the business and restricted payments. “This amendment provides significant near-term flexibility to mitigate the impact of the COVID-19 pandemic, protecting our ability to invest in the business and positioning us for recovery with permanently wider latitude on covenants,” Chief Financial Officer Dan Mathewes said in a statement.
• Ingersoll-Rand Inc. (NYS:IR) reported first-quarter earnings that missed expectations, as the diversified industrial conglomerate sped up synergy actions related to Gardner Denver Holdings Inc.’s acquisition of Ingersoll-Rand PLC’s industrial business that closed in February in light of the pandemic. Synergy actions reduced costs by $80 million to $90 million, and the company expects to incur $450 million in costs. The company is not providing 2020 financial guidance given the uncertainty in economic conditions as a result of the pandemic.
• Lyft Inc. (NAS:LYFT) is planning to offer $650 million in convertible debt due 2025. The notes will be convertible into cash, shares of Lyft common stock or a combination of both, at Lyft’s choice. The interest rate and conversion rate will be determined at the offering’s pricing. The ride-sharing company said it plans to use a portion of the proceeds from the offering for general corporate purposes, including working capital and expenditures and potential acquisitions.
• Match Group Inc. (NAS:MTCH) is offering $500 million in senior notes that mature in 2028 in a private offering. Proceeds will be used to redeem the company’s 6.375% senior notes due 2024 and for general corporate purposes.
• Restaurant Brands International Inc. (NYS:QSR) Chief Executive Jose Cil said Burger King, Tim Horton and Popeyes restaurants are reopening with a range of public-safety measures designed to protect staff and customers from COVID-19. The company has introduced acrylic shields and contactless service at most restaurants, and is maintaining social-distancing using tabletop signage to indicate which tables are available. “We will be sanitizing tables and chairs after each use and will have hand sanitizer available in the dining room for our guests,” Cil wrote in an open letter. “We have turned off our self-serve soda fountains and are offering beverages, extra condiments and trays from the behind the front counter. And we benefit from a business model inside our restaurants that has minimal contact with anyone other than your friends and family who you are sitting with.”
• Zillow Group Inc. (NAS:Z) plans to raise $1 billion through stock and convertible debt offerings. The plans include a $500 million offering of Class C common stock and $500 million in convertible senior notes due 2025. The company plans to use the proceeds from the offerings to buy back a portion of the 2.00% convertible notes due 2021. The senior notes will be unsecured and convertible to cash, Class C shares or a combination of both at the holders option, at prices to be determined at the pricing of the offerings.
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