GLOBAL NEWS:
U.S. President Donald Trump on Tuesday urged that Tesla Inc be allowed to reopen its electric vehicle assembly plant in California, joining CEO Elon Musk’s bid to defy county officials who have ordered it to remain closed. “California should let Tesla & @elonmusk open the plant, NOW. It can be done Fast & Safely!” Trump wrote on Twitter. On Monday, Musk said production was resuming at the automaker’s sole U.S. vehicle factory, defying an order to stay closed and saying if anyone had to be arrested, it should be he. Musk tweeted “Thank you!” in response to Trump on Tuesday. Tesla shares were up 1.1% at $820.44 in late trading on Tuesday. Employee-parking lots at Tesla’s factory in Fremont, California were packed with cars on Tuesday. Trucks could be seen driving in and out of the factory grounds. At the Fremont factory’s outbound logistics parking lot, where only a dozen Tesla cars were parked last week, hundreds of Tesla vehicles were seen on Tuesday. Tesla has planned to fully reopen its battery plant in Nevada, the Verge reported late Tuesday, citing an internal email. According to a Reuters report last week, Tesla said it had begun limited operations at its Gigafactories in Nevada and New York. Scott Haggerty, the Alameda County supervisor for the district where Tesla’s factory is located, told the New York Times on Saturday that the county had been working to permit Tesla to resume operations on May 18 - the same day other U.S. automakers have been permitted to resume production in other states. Trump is eager for the U.S. economy to reopen and for Americans to return to work. California Governor Gavin Newsom on Monday said he had spoken with Musk several days ago and that the Tesla founder’s concerns helped prompt the state to begin its phased reopening of manufacturing last week. Tesla also has a vehicle plant in Shanghai and is building another in Berlin. Its lawsuit on Saturday alleged that Alameda County had violated California’s constitution by defying Newsom’s orders allowing manufacturers to reopen.
Lending by Japan’s major banks rose in April at the fastest pace since the global financial crisis in 2009, data showed on Wednesday, highlighting a jump in borrowings by firms facing funding strains in the wake of the coronavirus crisis. Analysts expect lending to rise further as the government has asked commercial banks to offer low-interest loans to tide over the pandemic-driven funding gap at firms. Separate data showed a surge in the number of financial institutions joining the Bank of Japan’s new cheap loan programme, a welcome sign for the central bank’s efforts to pump money to a broader range of firms hit by the health crisis. The world’s third-largest economy is on the cusp of a deep recession, as the pandemic forces households to stay home and businesses to shut down. Japan has so far reported close to 16,000 coronavirus infections and over 650 deaths. A breakdown showed lending by major banks jumped 3.4% in April from a year earlier after a 2.0% increase in March, marking the fastest growth rate since January 2009. The surge reflects an increase in the number of big companies borrowing funds as a precaution against the risk of a prolonged slump in sales due to the pandemic, analysts say. The BOJ ramped up stimulus for the second straight month in April, focusing on steps to ease corporate funding strains as slumping sales prodded firms to hoard cash. It further expanded the programme in April by accepting a wider range of collateral and offering a 0.1% interest to financial institutions tapping the programme - a move aimed at encouraging them to use the scheme and boost lending to firms. The reward of a 0.1% interest seemed to have paid off. The number of financial institutions that applied to participate in the programme more than doubled to 74 with new applicants consisting of many regional banks, BOJ data showed on Tuesday.
Prime Minister Narendra Modi said on Tuesday that India would provide 20 trillion rupees in fiscal and monetary measures to support an economy battered by a sweeping weeks-long lockdown to fight the novel coronavirus. India has more than 70,000 cases among its 1.3 billion population and is set to surpass China, the origin of the outbreak, within a week. Modi said strict stay-at-home orders would be extended beyond May 17 with a new set of rules. In an address to the nation, he said the package was equivalent to 10% of India’s gross domestic product, and was aimed at the multitudes out of work and the businesses reeling under the prolonged shutdown. In March, the government said it was providing around 1.7 trillion rupees ($2.6 billion) in direct cash transfers and food security measures, mainly for the poor, but was widely accused of doing too little. Economists said the new package included the March allocation as well as liquidity measures announced by the central bank worth $6.5 trillion rupees. “Headline announcement looks positive. Would include around 6.5 trillion rupees already done by RBI and the first package. So - additional is 13.5 trillion rupees,” said Sandip Sabharwal, a Mumbai-based fund manager. Last week, India increased its borrowing programme for the year to 12 trillion rupees from 7.8 trillion to fund some of the expenses.
Oil prices fell on Wednesday on worries about a possible second wave of coronavirus cases in countries starting to ease lockdowns, while industry data showed a rise in U.S. crude inventories. The concerns overshadowed a further call by Saudi Arabia for larger production cuts to balance the market following a virus-induced demand slump, after OPEC’s biggest producer said earlier this week it planned to add to cut output again. Brent crude LCOc1 was down 58 cents, or 1.9%, at $29.40 by 0221 GMT, having risen 1.2% on Tuesday. U.S. crude was down 39 cents, or 1.5%, at $25.39 a barrel, after jumping nearly 7% in the previous session. U.S. infectious disease expert Anthony Fauci on Tuesday told Congress that easing coronavirus lockdowns may set off new outbreaks of the illness, which has killed 80,000 Americans and badly damaged the world’s biggest economy.On the supply side, Saudi Arabia’s cabinet has urged OPEC+ countries to reduce oil output further to restore balance in global crude markets, the country’s state news agency reported early on Wednesday.On Monday, Saudia Arabia said it would add to planned cuts by reducing production by a further 1 million barrels per day next month, bringing output down to 7.5 million bpd. The Organization of the Petroleum Export Countries and other producers such as Russia - a group known as OPEC+ - agreed to cut output by 9.7 million barrels per day in May and June, a record reduction, in response to a 30% fall in global fuel demand. In the United States, inventories of crude oil rose by 7.6 million barrels last week to 526.2 million barrels, against analysts’ expectations for an increase of 4.1 million barrels.