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Our briefing for Friday May 14, 2021:
May 14, 2021 3:13:57 PM
- In the United States, the Centers for Disease Control and Prevention (CDC) have updated their policy on mask guidelines for fully vaccinated people. The CDC now says fully vaccinated people no longer need to wear a face mask, or socially distance in most settings, whether indoors or outdoors. The news was met with a sense of relief and confusion as the move by the CDC seems to indicate America is one step closer to returning to normal, but it now requires essential workers to become vaccine police. Adding onto the confusion, the CDC’s guidelines are only recommendations. States, municipalities and businesses can decide whether or not they want to follow it.
- In Canada, the Public Health Agency tried to give Canadians a glimpse of what year two of a summer within a pandemic will look like. Health officials said Friday if 75% of Canadians eligible for vaccines have had one dose and 20% a second dose, a summer could include camping, hiking, picnics and patios, but large crowds such as concerts and sporting events should still be avoided. As for right now, Canadians are encouraged to stay the course set out by their provincial jurisdictions and that reopening is not only about vaccinations rates – ensuring COVID-19 transmission is controlled “to a manageable level” is just as important.
- The United Kingdom government could speed up vaccinations in districts that have seen surges in COVID-19 cases, thanks to the Indian variant. In a news conference on Friday, Prime Minister Boris Johnson said the UK will accelerate second doses of vaccines for the over-50 population and the clinically vulnerable. Prime Minister Johnson also said the Indian variant appeared to be more transmissible than other variants, but cautioned it wasn’t clear by how much. The prime minister doesn’t want to see the lockdown roadmap going off course as it would put him in direct conflict with his own Conservative Party who actually wanted to see a faster reopening thanks to a vaccination program that has proven to be one of the most advanced in the world.
- Bloomberg is reporting “covid zero” havens such as Singapore and Hong Kong are having a harder time reopening then their western financial hub counterparts. Places like New York City and London have started to return to in-person dealmaking and business as usual – tolerating hundreds of daily COVID-19 cases as vaccination drives increase. Singapore and Hong Kong risk being left behind as they maintain tight border controls and try to curb single-digit flareups. For instance, the two South Asian financial hubs have had their agreed upon travel corridor stop several times due to COVID-19 cases in each region.
- Japan’s government has added three more prefectures to a state of emergency due to increasing COVID-19 cases just 10 weeks out of the still planned Tokyo Olympics. Prime Minister Yoshihide Suga announced on Friday that Hokkaido, Okayama and Hiroshima will join Tokyo, Osaka and four other prefectures on Sunday under a state of emergency that will last until at least May 31st. Prime Minister Suga reiterated that the Olympics could still be held safely for both the athletes and Japanese nationals. A Japanese research institute estimate the state of emergency in the nine prefectures could slash about one trillion yen from the GDP of the world’s third largest economy.
- The World Health Organization (WHO) has urged rich countries to forego their plans to vaccinate children and instead donate COVID-19 shots to the COVAX initiative that shares them with poorer nations. “I understand why some countries want to vaccinate their children and adolescents, but right now I urge them to reconsider and to instead donate vaccines to #COVAX, WHO chief Tedros Adhanom Ghebreyesus told a virtual meeting in Geneva, Switzerland. The WHO is hoping more countries will follow the lead of France and Sweden in donating their shots after inoculating their priority populations to help address the disparity between rich and poor countries when it comes to vaccination drives. The COVAX initiative has delivered around 60 million doses so far and has struggled to meet supply targets, partly due to India’s latest COVID-19 surge.
Covid-19 – Due Diligence And Asset Management
Investors Pull $1.2 Billion From the Largest Junk Bond ETF
Brief : Investors in exchange-traded funds are abandoning junk bonds as riskier assets come under pressure from inflation fears. About $1.2 billion was pulled from BlackRock’s iShares iBoxx High Yield Corporate Bond (HYG) on Thursday in its worst day of outflows since February 2020, according to data compiled by Bloomberg. Traders have withdrawn about $5.6 billion from the ETF so far in 2021, putting it on track for its worst year since its inception in 2007. Meanwhile, the rival $9.6 billion SPDR Bloomberg Barclays High Yield Bond fund (JNK) is on pace for its second week of outflows, totaling more than $970 million. With interest rates at rock-bottom lows, investors had previously favored the high-yield market. But that calculation could now be changing, said Matt Maley, chief market strategist for Miller Tabak + Co. “Investors are taking some risk out of their portfolio,” he said. “With inflation fears growing, that means the yields on some safer assets will be rising as well. That will provide at least some competition for a high-yield market that hasn’t seen any competition for a long time.”
UK Eager for a Big Reopening Thanks to Vaccine Success
Brief: When London’s Science Museum reopens next week, it will have some new artifacts: empty vaccine vials, testing kits and other items collected during the pandemic, to be featured in a new COVID-19 display. Britain isn’t quite ready to consign the coronavirus to a museum — the outbreak is far from over. But there is a definite feeling that the U.K. has turned a corner, and the mood in the country is upbeat. “The end is in sight,” one newspaper front page claimed. “Free at last!” read another. Thanks to an efficient vaccine rollout program, Britain is finally saying goodbye to months of tough lockdown restrictions. Starting Monday, all restaurants and bars in England can reopen with some precautions in place, as can hotels, theaters and museums. And Britons will be able to hug friends and family again, with the easing of social distancing rules that have been in place since the pandemic began. It’s the biggest step yet to reopen the country following an easing of the crisis blamed for nearly 128,000 deaths, the highest reported COVID-19 toll in Europe. Deaths in Britain have come down to single digits in recent days. It’s a far cry from January, when deaths topped 1,800 in a single day amid a brutal second wave driven by a more infectious variant first found in southeastern England.
‘Burning Out’: Remote Workers Report Paying a Price for Increased Productivity
Brief: Remote workers in Canada are logging more hours, experiencing more stress, and feeling less engaged with their work, according to a new survey. The online survey, conducted by ADP Canada and Angus Reid, asked 1,501 Canadians working remotely and in person to evaluate their experience working during the pandemic, including their work hours, productivity, engagement, stress levels, and quality of their work. The survey found that 44 per cent of remote workers reported they were logging more hours of work than they were in pre-pandemic times. Of those, one in ten reported working an additional day, or more than eight extra hours per week. In contrast, only 15 per cent reported working fewer hours and 38 per cent said there was no change in the hours they worked. Janet Candido, a human resources professional of 20 years and founder and principal of Candido Consulting Group, said she thinks people are working longer hours because they’re not as busy in the evenings or on weekends due to pandemic-related restrictions. “I heard this from my own team a year ago: ‘Well, I don't have anything else to do so I might as well get this done,’” she told CTVNews.ca during a telephone interview on Thursday.
Brevan Howard Triples Workspace with New London Headquarters
Brief: Brevan Howard Asset Management is moving to a new London headquarters that’s almost three times larger than the hedge-fund firm’s existing office, signaling an expansion plan after a record year of gains. The company has taken over a lease from French advertising giant Publicis Groupe SA in the city’s West End, according to people familiar with the matter. The building at 82 Baker Street, which is near the firm’s current headquarters, has more than 70,000 square feet (6,500 square meters) of office space, the people said, asking not to be identified because the deal is private. It’s not clear if Brevan Howard will occupy the entire space itself or sublease parts of the office. A spokesman for the firm declined to comment and a spokeswoman for Publicis didn’t respond to emails seeking comment. Brevan Howard, which managed $14.6 billion at the end of March, and other hedge funds have been on a hiring spree as market volatility creates more trading opportunities. The company co-founded by billionaire Alan Howard last year posted the best returns in its near two-decade history, with its main fund up more than 27% and its U.S. Rates Opportunities Fund soaring nearly 99%.
Investors Target Stocks in Vaccine Hotspots
Brief: Global equity funds enjoyed a second consecutive month of record inflows as UK investors added nearly £3 billion to the asset class. According to the latest fund flow data from Calastone, investors favoured global, UK and North American funds. Demand for European equity products waned, perhaps as the continent lags the UK and US in its Covid-19 vaccine drive, Calastone said. UK investors also added over £880 billion to bond funds. Total inflows across all asset classes hit £6.1 billion by the end of the month. Edward Glyn, head of global markets at Calastone, highlighted that the pandemic is “claiming more lives than ever around the world, but in the UK and North America it is in retreat. “The situation in Europe is improving, and it remains under control in most parts of Asia. Stock markets have been on a gently rising trend, while bond yields which are bad for share prices when they rise, have been steady,” he said, adding that investors are looking to the post-pandemic boom.
Ethereum’s Co-Founder Vitalik Buterin Donates Over $1 Billion to India Covid Relief Fund and Other Charities
Brief: Ethereum’s co-founder Vitalik Buterin, who became the world’s youngest known crypto billionaire less than two weeks ago, has donated over $1 billion in crypto to the India Covid Relief Fund and a range of other charities. He made the donation by offloading massive amounts of dog-themed meme tokens, which he was gifted by the creators of Shiba Inu coin (SHIB), Dogelon (ELON) and Akita Inu (AKITA). These cryptocurrencies have taken off following Dogecoin’s staggering rally of the last few months. Though built around similar memes, these copycats have much larger token supplies. In a single transaction, Buterin donated 50 trillion SHIB tokens worth $1.2 billion as of May 12, 16:37 pm E.T. to the India Covid Relief Fund set up by Indian tech entrepreneur Sandeep Nailwal. Nailwal is best known as the co-founder and COO of Polygon, a protocol which aggregates scalable solutions on Ethereum in a multi-chain system. Earlier in April, Buterin donated about $600,000 in ether and maker (MKR) tokens to the fund. Nailwal immediately took to Twitter to thank Buterin and assure SHIB investors the funds will be spent responsibly. “We will not do anything which hurts any community specially the retail community involved with SHIB,” wrote Nailwal.
