Brief: On April 2, the day that coronavirus infections around the globe hit 1 million, managers inside JPMorgan Chase & Co. were emailing their latest plans for staffing New York-area trading floors amid the deadly pandemic. One worker on the sales team noticed a colleague wasn’t on the list and asked where he’d be “Corona Town, U.S.A.,” the person wrote back. Then one of the bank’s credit-trading leaders, Nicholas Adragna, weighed in: “The trading desk will be in the office unless they have a medical condition with a dr’s note.” More than 100 employees were on the message chain seen by Bloomberg, and some were horrified. It came soon after an outbreak of COVID-19 inside JPMorgan’s Madison Avenue headquarters, in which at least 16 people tested positive on a single trading floor.
Brief: A leading global health fund has asked international businesses and governments to provide $8 billion to support development and production of COVID-19 tests, drugs and vaccines. British-based Wellcome Trust said the initiative, dubbed COVID-Zero, is aimed at the private sector and it is urging chief executives of multinational companies to join the coalition and save lives. An initial $8 billion by the end of April - a fraction of the sums wealthy governments have injected into struggling economies - would be enough to develop new COVID-19 tests, drugs and vaccines and to begin scaling up production, the fund said.
Brief: The head of the U.S. Securities and Exchange Commission (SEC) said on Tuesday that companies in discussions about bailouts resulting from the economic impact of the coronavirus outbreak should disclose to investors where they stand. “We’re in a very different environment,” SEC Chairman Jay Clayton said in an interview on CNBC. “Companies are going to be talking about where they stand ... and their plans going forward is sensitive information. I encourage companies to disclose where they stand and limit speculation ... as we move forward.” Clayton added that companies must communicate with investors about plans for dividends, share buybacks and capital preservation.
Brief: Convicted former drug company CEO Martin Shkreli, known as “Pharma Bro,” wants to get out of prison so he can help research a treatment for the coronavirus, his lawyer said Tuesday. Defence attorney Ben Brafman said that he will file court papers asking federal authorities to release Shkreli for three months so he can do laboratory work “under strict supervision. His client — best known before his arrest for drug price-gouging and his snarky online persona — is housed at a low-security prison in Allenwood, Pennsylvania. “I have always said that if focused and left in a lab, Martin could help cure cancer,” Brafman said in a statement. “Maybe he can help the scientific community better understand this terrible virus.” In a research proposal posted online, Shkreli called the pharmaceutical industry’s response to the pandemic “inadequate” and said researchers at every drug company “should be put to work until COVID-19 is no more.”
Brief: The liquidity crunch that shuttered 35 bond funds in Sweden last month has revealed some disturbing truths about the country’s credit market. As the spread of Covid-19 across Europe triggered a sell-off in corporate bonds, investors keen to withdraw their savings in Sweden suddenly learned they couldn’t. While the Swedish funds were legally entitled to suspend trading to ensure fair treatment for all their customers -- a process known as gating -- it now seems clear that investors weren’t aware of the risks they faced. The episode has sparked calls for funds to drastically adjust their marketing practices. “It’s reprehensible that some corporate bond funds have marketed themselves as an alternative to savings accounts,” said Frida Bratt, a savings economist at Nordnet Bank AB. But many investors “haven’t realized there’s a whole different risk level involved.”
Brief: Activist investor Bill Ackman was so concerned about the potential impact of the coronavirus that he considered liquidating his hedge fund’s entire portfolio for the first time. Instead, the billionaire opted for another strategy: a lucrative credit hedge that earned his firm about $2.6 billion in profits when the market plummeted. Ackman said in a letter to investors in the fund, Pershing Square Capital Management, Monday that he used the proceeds from the credit bet to substantially boost investments in several portfolio companies. That included increasing his stake in Warren Buffett’s Berkshire Hathaway Inc. by 39%, and reinvesting in Starbucks Corp. in a new position valued at roughly $730 million.