Live News: Cathay Pacific will lose up to $ 783 million in 2021 as Covid slows down

Cathay Pacific will lose up to $ 783 million in 2021 as Covid curbs bite

Empty Cathay Pacific check-in counters at Hong Kong International Airport
Empty Cathay Pacific check-in counters at Hong Kong International Airport © Chan Long Hi / Bloomberg

Cathay Pacific recorded losses of as much as HK $ 6.1bn ($ 783m) last year as a continuing decline in demand and severe coronavirus travel restrictions hit Hong Kong airline.

The de facto flagship expected to see a $ 719m shareholder loss of $ 783m in the year ended December 31, it said in a preliminary review on Monday. The figure continued to mark an improvement from the hit of almost $ 2.8 billion that the accounts received in 2020 after an increase in demand for cargo.

Cathay has faced intense pressure from Hong Kong authorities who accused employees of inciting the first outbreak of the Omicron variant. The company warned that a tightening of quarantine measures for flight crews and other curbs last month could result in an estimated cash burn of almost $ 193 million per month from February.

“These measures will have a significant impact on our passenger and cargo capacity,” said CEO Augustus Tang.

The airline also said it carried 92,219 passengers last month, an increase of more than 130 percent from the previous year, but still a decline of 95 percent from the level before the 2019 pandemic.

Hong Kong has adopted a zero-covid strategy similar to that in mainland China, which included three weeks of hotel quarantine and a ban on flights from eight countries until at least next month. Despite such measures, the authorities registered 140 infections on Sunday, the highest number in a single day in 18 months, while the territory is fighting a spiral outbreak of the Omicron variant.

Australian private sector shrinks for the first time in four months, PMI shows

Customers sit outside a cafe in Sydney's Bondi Beach

Customers sit outside a cafe in Sydney’s Bondi Beach © Mark Baker / AP

Australia’s private sector shrank for the first time in four months as the Omicron coronavirus variant disrupted operations, according to the latest purchasing managers’ index data.

The IHS Markit Flash Australia Composite Output Index fell to a five-month low of 45.3 in January from 54.9 in December 2021, when both private sector output and demand fell while employment growth stopped.

The Australian economy appeared to have recovered in the second half of 2021. However, a sharp rise in Omicron infections, which had a daily record of almost 90,000 last week, has dampened growth, damaged consumer confidence and business optimism and affected supply chains, with supermarkets and the hospitality sector hit by anemic employees. These factors contributed to sharp price growth.

The mining-rich state of Western Australia has continued to keep the border closed to other Australian territories as a result of the spread of Omicron.

Jingyi Pan, an economist at IHS Markit, said: “The Australian economy had fallen from a state of sharp recovery [at] the end of 2021 to be affected by the increase in Covid-19 infections by the beginning of 2022. »

Despite the disturbance from Omicron, Pan said that there was reason for optimism: “There have been some early positive signs that Covid-19 infections are peaking in Australia, which may give some hope for a turnaround in the situation without further restrictions. . »

Australia’s Fortescue buys Williams F1 battery and technology arm for £ 164 million

Fortescue Metals Group’s green investment division has agreed to buy the battery and technology arm of Williams’ Formula 1 racing team for 164 million pounds.

The Australian mining group said it would use the battery systems and electrification technology acquired by Fortescue Future Industries to help achieve the goal of being carbon neutral by 2030.

It plans to use the new systems to adapt its 3 km long freight trains, heavy industrial equipment and 400-ton trucks to reduce emissions at the mining facilities, it is said.

The first major project will be an electric train concept, said Fortescue, which it expects will be a significant development in the green industrial transport sector.

Andrew Forrest, chairman and founder of Fortescue, said: “This announcement is the key to unlocking the formula to remove fossil fuel-powered machinery and replace it with zero carbon emissions technology.”

Williams, one of the most well-known names in car racing, was sold to the American fund Dorilton Capital in 2020 for 152 million pounds in what was seen as an admission that the team could no longer compete with better funded rivals such as Red Bull and Mercedes -Benz.

What to see in Asia today

An employee stands at the entrance to a closed gaming hall at Macau's Grand Lisboa Hotel
An employee stands at the entrance to a closed gaming hall at Macau’s Grand Lisboa Hotel © Anthony Kwan / Getty Images

Macau: Chinese lawmakers will make their first reading of a gambling law. The proposal will increase government oversight of the lucrative industry, halve the duration of casino licenses to 10 years and regulate junket operations in one of the biggest upheavals in the casino hub.

Singapore: Singapore is set to release its consumer price index for December, which will give an indication of the pace of the rise in domestic economic activity.

Taiwan: Taiwan will release industrial production data for December following coronavirus-related disruptions, such as staff shortages, in manufacturing activities.

Pakistan: The Government Bank of Pakistan is expected to stand by its monetary policy announcement, on expectations that a global increase in commodity prices will ease as the central banks become hawkish.

Markets: Futures for Australia, Hong Kong and Japan signal that the region’s main stock markets are set to fall after global stock markets registered their sharpest weekly declines since the start of the pandemic as the Federal Reserve moves to tighten financial conditions.

Rolls-Royce is seeking bids for land to build small nuclear power plants

A picture of what the miniature systems can look like

A Rolls-Royce image of what miniature systems can look like © Rolls-Royce

Rolls-Royce, the British aircraft engine manufacturer, has launched a competition between regions in England and Wales to be the site of the main plant to build a planned fleet of small nuclear reactors.

An industry consortium led by Rolls-Royce has written to several of England’s regional development agencies and the Welsh government asking them to pitch for the production site, promising investments of up to £ 200 million and the creation of up to 200 direct jobs.

The consortium secured £ 210 million from the government last year for the development of a fleet of mini-reactors after raising a similar amount of private sector funding.

The Prime Minister of the United Kingdom Boris Johnson supported small modular reactors as part of his 10-point plan for a “green industrial revolution” to help meet the government’s 2050 net zero carbon target. The technology is seen by the authorities as a good way to create production jobs, in addition to delivering on Johnson’s “equalizing” agenda to help less developed areas.

According to the plans, the reactors will be built in factories around the country and then assembled on site, which reduces the risk and the enormous costs of building large nuclear power plants. The main factory will build the heavy pressure vessels that are part of the reactors.

Activist hedge fund Trian builds ownership interests in Unilever

Nelson Peltz’s activist hedge fund Trian Partners has built a stake in Unilever, increasing pressure on the FTSE 100 company after its failed search for GlaxoSmithKline’s consumer health business.

People with direct knowledge of the case told the Financial Times that the $ 8.5 billion New York-based hedge fund had taken a position in the shares of the British group, which contributed to the challenges facing CEO Alan Jope.

The Unilever boss is already facing smoldering shareholder dissatisfaction after the attempt to take over GSK Consumer Health of 50 billion pounds. He now confronts a fierce activist fund known for demanding streamlining and governance reforms in consumer goods groups including Procter & Gamble, Sysco and Mondelez.

The people with knowledge of the rod construction did not give details about the size or exactly when it began.

The revelation comes after a turbulent week for Unilever where they were forced to agree to the shareholder demands to stop the hunt for GSK’s consumer health business after three failed bids.

The investor uprising last week drove Unilever’s share price down by as much as 11 percent. They recovered part of the losses after the company said they would not raise the offer further.

The Fed expected to support the first rate hike from the March pandemic

Jay Powell, chairman of the US Federal Reserve, is listening in on a January 11 Senate hearing
Jay Powell, Chairman of the Board of the US Federal Reserve, listens to a Senate hearing on January 11 © Brendan Smialowski / AFP via Bloomberg

The Federal Reserve is set to confirm its plans to raise interest rates in March for the first time since the outbreak of the pandemic, as the US Federal Reserve maps a more aggressive course against monetary tightening in the face of sticky inflation.

Fed officials will gather this week for their first political meeting in 2022, the first since the central bank made the fight against rapid consumer price inflation in the US a top priority.

The Fed has sharpened its rhetoric in recent weeks about the risk of high inflation, and this month Chairman Jay Powell has called it a “serious threat” to sustained economic expansion and a robust rise in the labor market.

Its top decision-makers have also made it clear that they are willing to act vigorously to ensure that inflation does not become entrenched, by considering raising interest rates “rather or at a faster pace” than expected and rapidly shrinking the Fed’s huge balance sheet this year.

Along with growing evidence that inflation is expanding and the labor market is recovering quickly, the central bank is well positioned to move in March, many Fed officials and Wall Street economists claim.

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