Investors await data on coronavirus drugs as market rally builds

NEW YORK (Reuters) – Clinical data on potential treatments for the new coronavirus could help sustain a market bounce that has buoyed stocks after last month’s plunge, as investors look for signs that authorities may be able to stabilize the pandemic.

Highly anticipated data for a Gilead Sciences Inc (GILD.O) experimental antiviral drug are expected later this month. Analysts are also awaiting results in the near-term for products already approved for other conditions from companies such as Roche Holding (ROG.S) and Regeneron Pharmaceuticals (REGN.O).

While experts estimate an approved vaccine could be at least a year away, progress toward treatments that benefit some COVID-19 patients could help investors gauge when the epidemic could come under control and some economic activity might resume.

“The more we see positive clinical data, the more investors will be comforted in the fact that this is a transitory issue like all epidemics are,” said Art Hogan, chief market strategist at National Securities.

Early signs of a slowdown in hospitalizations and intensive care needs in coronavirus hotspots in the United States and abroad have fed a stock market turnaround sparked by massive support from the Federal Reserve and a more than $2 trillion government bailout. As of Monday, the S&P 500 .SPX was off about 21% from its Feb. 19 all-time high but had rebounded 19% since March 23.

“With each incremental piece of good news, that gets us closer to the end of the epidemic and the economic damage that falls in its wake,” Hogan said.

New York is nearing a plateau in the number of coronavirus patients hospitalized, Governor Andrew Cuomo said on Tuesday, even though the number of the deaths in the state hit a single-day high.

Governments around the world have locked down their communities – urging citizens to stay inside and ordering restaurants, stores and other businesses shuttered – to contain the spread of COVID-19 cases, which have exceeded 1.4 million globally with over 80,000 deaths, according to a Johns Hopkins tally.

Drugmakers are studying ways to combat the respiratory illness, for which there are no approved treatments, as hospitals face strains from the flood of patients.


More than 330 clinical studies related to COVID-19 are listed in, a database maintained by the U.S. National Institutes of Health, including many seeking to test drugs already approved for other conditions.

Gilead’s remdesivir, which is administered intravenously, is one experimental treatment that has captured investors’ attention. The biotechnology company’s chief executive on March 28 said initial data would arrive in the “coming weeks” here and analysts said data could come in mid April.

Remdesivir previously failed as a treatment for the Ebola virus. But it helped prevent disease and reduce severity of symptoms in monkeys infected with a virus more closely related to the new coronavirus in a study, raising hopes.

Some analysts are cautioning against expecting that remdesivir will show an overwhelming benefit.

Initial data are expected to come from studies of patients with relatively severe COVID-19. Because antivirals work best when patients are healthier, those results may show limited effectiveness, said Evan Seigerman, a biotech analyst at Credit Suisse.

Even if remdesivir proves effective, the amount of the drug that would be available remains a concern. Gilead said last weekend here its existing supply could equate to more than 140,000 courses of treatment.

Data is also anticipated for Regeneron (REGN.O) and Sanofi’s (SASY.PA) Kevzara, perhaps by the end of the month, and for Roche’s (ROG.S) Actemra – two similar rheumatoid arthritis drugs being tested for COVID-19 illness.

Studies are also ongoing for hydroxychloroquine, a decades-old malaria drug that has been used by doctors for COVID-19 despite controversy over its effectiveness.

“Just knowing that something works means investors can start thinking about the other side of this,” said Keith Lerner, chief market strategist at Truist/SunTrust Advisory Services, in emailed comments to Reuters, “both from a human side and an economic and market perspective.”

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Wall Street gains on hopes of coronavirus slowdown

(Reuters) – Wall Street rose on Tuesday on early signs of the coronavirus outbreak plateauing in some of the biggest U.S. hot spots, with the New York governor saying social distancing measures to curtail the spread of the virus were working.

The S&P 500 was set for its biggest two-day gain in nearly two weeks, building on a 7% jump on Monday, as health officials also said the pandemic may kill fewer Americans than recent projections.

Gains were led by the energy, materials and financials sectors, with an aggressive round of U.S. fiscal and monetary stimulus in the past month also boosting risk appetite.

“The rally is sentimental and a little premature because if we lift these lockdown measures too soon and try to resume economic activity, we’re going to get a very severe pandemic rebound,” said Indranil Ghosh, chief executive officer of Tiger Hill Capital in London.

The S&P 500 is up about 22% from March intraday lows, but remains 19% below its mid-February record high as strict stay-at-home orders crushed demand across industries including airlines, automakers and hotels.

At 1:26 p.m. ET the Dow Jones Industrial Average was up 626.56 points, or 2.76%, at 23,306.55, the S&P 500 was up 63.85 points, or 2.40%, at 2,727.53 and the Nasdaq Composite was up 143.16 points, or 1.81%, at 8,056.40.

Wall Street’s fear gauge has steadily retreated from 12-year peaks, but volatility is expected to remain high as companies prepare to report an expected slide in first-quarter earnings and outline more drastic plans to bolster cash reserves.

“I’d like to think that the bottom is behind us, but I wouldn’t say that’s necessarily the case,” said Bert Brenner, director of asset allocation strategy at People’s United Advisors in Bridgeport, Connecticut.

Analysts now expect first-quarter earnings for S&P 500 firms to fall 6.4% compared to a Jan. 1 forecast for a rise of 6.3%.

Exxon Mobil throttled back a multi-year investment spree in shale, LNG and deep water oil production, saying it would cut planned capital spending this year by 30% as the pandemic saps energy demand.

Oilfield services firm Halliburton Co said it would cut about 350 jobs in Oklahoma and that its executives would reduce their salaries.

Exxon and Halliburton shares jumped 6% and 7%, respectively.

Norwegian Cruise Line, Royal Caribbean and Carnival Corp, among the most heavily battered stocks this year due to a near halt in global tourism, rose between 16% to 21%.

Advancing issues outnumbered decliners for a 6.01-to-1 ratio on the NYSE and a 2.44-to-1 ratio on the Nasdaq.

The S&P index recorded four new 52-week highs and no new low, while the Nasdaq recorded nine new highs and 14 new lows.

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Big OPEC+ oil output cuts depend on U.S., others joining: sources

LONDON/MOSCOW (Reuters) – Saudi Arabia, Russia and allied oil producers will only agree to deep cuts to their crude output at talks this week if the United States and several others join in with curbs to help prop up prices that have been hammered by the coronavirus crisis.

Global oil demand has dropped by as much as 30%, or about 30 million barrels per day (bpd), as measures to prevent the virus spreading have slashed demand for jet fuel, gasoline and diesel.

On top of sliding demand, Saudi Arabia and Russia have been flooding the market with extra crude after the collapse last month of a three-year-old deal on limiting supplies between OPEC, Russia and their allies, a group known as OPEC+.

OPEC+ is due to hold a video conference on Thursday at 1400 GMT, after U.S. President Donald Trump said last week he had brokered a deal between Riyadh and Moscow on cuts amounting to an unprecedented 10 million to 15 million bpd, or about 10% to 15% of global supplies. Nothing has yet been formalised.

An OPEC source told Reuters on Tuesday the size of any OPEC+ curbs depended on volumes other producers such as the United States, Canada and Brazil were willing to cut.

Other OPEC+ sources have echoed this, saying it hinged on action by the United States, where costly shale oil production has surged with the help of OPEC+ action since 2016 to support prices. “Without the U.S., no deal,” said one OPEC+ source.

The United States has yet to commit to any cut, while Trump has said U.S. oil production had already fallen.

After the OPEC+ talks, Saudi Arabia will host a video conference on Friday for energy ministers from the Group of 20 (G20) major economies “to ensure energy market stability”, an internal document seen by Reuters showed.

A senior Russian source said efforts to get the United States involved in the production cut deal will be on the agenda for Friday’s G20 talks, scheduled for 1200-1420 GMT.

Two Russian sources said Russia was ready to cut output substantially without giving precise numbers.


Riyadh and Moscow blamed each other for the collapse of the previous OPEC+ deal last month and have since then waged a war for market share, sending oil prices to their lowest in almost two decades. Benchmark Brent LCOc1 was trading at about $33 a barrel on Tuesday, about half its level at the end of 2019.

Saudi Arabia, with by far the world’s biggest reserve of extra capacity and some of the lowest production costs, raised crude output to 12.3 million barrels per day (bpd) on April 1 and said it planned to export more than 10 million bpd.

Riyadh had insisted it would no longer carry what it considered an unfair burden of output cuts.

Russian President Vladimir Putin has said any output cuts should be made from levels in the first quarter, before Saudi Arabia and other hiked production. OPEC sources said Riyadh wanted cuts to be calculated from its current higher level.

The OPEC source said there was no consensus between Riyadh and Moscow yet on the baseline for any reductions.

U.S. antitrust laws prohibit oil producers in the United States from taking steps to push up oil prices, but output curbs would be legal if state regulators or the federal government set lower production levels, experts say.

Other oil producers outside the OPEC+ group have already indicated a willingness to help. Canada’s Alberta province, home to the world’s third-largest oil reserves, said it was open to joining any potential global pact.

Norway, the biggest oil and gas producer in Western Europe, said it was considering attending the OPEC+ talks on Thursday as an observer and would join production cuts if there was broad support for such a move.

Brazil’s Energy Minister Bento Albuquerque said he was ready to attend the G20 call.

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Asian shares poised to climb after Wall Street rallies

(Reuters) – Asian markets looked poised on Tuesday to attempt another day of gains after stocks rallied on signs of a slowdown in coronavirus-related deaths, as oil prices resumed their decline on doubts about a potential Saudi-Russian pact to cut output.

Hong Kong futures were up and Australia futures also rose in early trade.

Nikkei futures opened lower but were 2.3% above the cash close. The yen eased 0.01% as traders awaited more details on the government’s stimulus package.

On Monday, Japanese Prime Minister Shinzo Abe pledged to roll out an unprecedented economic stimulus, equal to 20% of economic output, as his government vowed to take “all steps” to battle deepening fallout from the coronavirus.

Equity investors kicked off the week encouraged by the slowing death toll from the virus across major European nations, including France and Italy. U.S. stocks rallied on Monday, with the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite all gaining more than 7%.

“Markets started the trading week with a more positive tone following early signs of improvement in virus data for key hot spots,” ANZ Research economists said in a morning note.

Emerging market stocks rose 2.66% at the start of the week. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 2.77% higher.

The governors of New York and New Jersey pointed to tentative signs that the coronavirus outbreak in their states was starting to plateau but warned against complacency, while across the Atlantic British Prime Minister Boris Johnson, who has the COVID-19 disease caused by the virus, was taken to intensive care, driving down the pound.

Reported cases of coronavirus, have exceeded more than 1.27 million globally and 70,395 have died, according to a Reuters tally.

Oil futures resumed their decline, falling more than $1 per barrel on Monday, after Saudi Arabia and Russia delayed a key meeting aimed at resolving growing excess supplies at a time the pandemic has pushed down demand.

Prices had previously notched two sessions of double-digit gains on hopes the producers would meet and agree to production cuts.

Gold prices rose, touching a fresh 3-1/2-week high.

Demand for gold, seen as a store of value, has jumped as governments around the world roll out stimulus packages to soften the economic blow of the pandemic, but effectively diluting their currencies.

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Alaska's RavnAir bankruptcy while awaiting government aid shows regional airlines' challenges

WASHINGTON/CHICAGO (Reuters) – RavnAir Group, the largest regional carrier in Alaska, filed for bankruptcy on Sunday and grounded all of its 72 planes, saying it was clear that government aid would not arrive before it ran out of cash in the midst of an “astonishing” decline in bookings and revenue due to the coronavirus.

Its Chapter 11 filing underscores the challenges facing other U.S. regional carriers that, like larger airlines, are seeking federal aid to help them through the worst downturn the industry has ever faced.

RavnAir – which has a partnership with Alaska Airlines and interline agreements with American Airlines, United Airlines and Delta – said it applied on Friday for federal payroll support but did not know if or when it would be granted.

The Trump administration is weighing applications from numerous airlines as it considers how to distribute as soon as this week up to $32 billion for passenger and cargo carriers and airport contractors under the CARES Act meant to help the sector cover payroll costs.

Regional airlines, which tend to serve remote communities, are particularly vulnerable to the downturn because they are not publicly traded and cannot access capital markets. They have asked the U.S. Treasury Department to prioritize assistance for them when awarding the grants.

Many of RavnAir’s customers fly on Medicaid-subsidized tickets, it said, while other key customers include companies in industries like oil & gas, mining, and tourism where business is suffering. In addition, by mid-March it was receiving demands from rural hubs and villages around Alaska not to fly passengers to or from their communities, it said in a court filing.

The tale of RavnAir reflects airlines’ woes across the country that began seeing a dramatic drop in bookings around March 12 when it became clear that coronavirus outbreaks were increasing across the world.

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RavnAir said it had laid off almost all of its workforce and suspended operations before filing for Chapter 11 in Delaware on Sunday, but hopes to be able to restart on the other side of bankruptcy, particularly if it receives government relief.

In a letter posted Sunday, RavnAir Chief Executive Dave Pflieger said the airline was working to “resume the vital air service you depend on to get home to your families, to your businesses, to medical appointments, and to other duties that are essential to our communities and the state of Alaska.”

On Sunday, top Democrats urged Treasury Secretary Steven Mnuchin to move quickly to release the grants without imposing unreasonable conditions.

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U.S. airlines ease loyalty programs in coronavirus travel slump

(Reuters) – U.S. airlines are extending loyalty program benefits and status into 2021 for members homebound because of the new coronavirus.

Business and leisure travel have virtually ground to a halt worldwide, forcing airlines to drastically reduce flying schedules and ground their jets. Before the pandemic, carriers had been actively courting business or first-class travelers in particular to boost revenue as competition intensified.

United Airlines Holdings Inc (UAL.O) is extending current members’ MileagePlus Premier status through January 2022, reducing thresholds for Premier qualification by 50%, offering more credit card points and making it easier to upgrade seating.

Delta Air Lines Inc (DAL.N) is extending its SkyMiles Medallion Members’ status as well as the expiration dates for upgrade certificates and travel vouchers.

American Airlines Group Inc (AAL.O) on Monday had no updates on its elite program, but said it was continuing to assess the situation.

Airlines are also offering waivers on change fees, and in some cases refunds, for travel booked in the next month or two. Terms and conditions vary by airline.

The U.S. Transportation Department has told airlines they must refund tickets for flights that they cancel, or make a significant schedule change that passengers do not accept, following a rising number of consumer complaints and inquiries.

U.S. and foreign airlines have canceled hundreds of thousands of flights and eliminated millions of seats as travel demand has plunged because of the coronavirus pandemic. Facing what carriers call an unprecedented crisis, many are seeking government aid to help them avoid employee layoffs.

In the United States, top Democrats in Congress on Sunday urged the U.S. Treasury to move quickly to award $32 billion in cash assistance to airlines and airport contractors without setting onerous requirements that could lead to bankruptcies.

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Britain's BT commits to no job losses over coronavirus

LONDON (Reuters) – The head of Britain’s biggest telecoms firm BT (BT.L) said he would donate his salary to health workers for at least six months and award a pay rise to his frontline staff who are maintaining broadband networks during the coronavirus shutdown.

Philip Jansen, one of Britain’s richest executives from his time overseeing the flotation of payments processor Worldpay, also said the company committed to no job losses related to the health crisis for at least three months.

A previous commitment to make an award of 500 million pounds ($615 million) worth of shares to all employees will also go ahead.

“This is an unprecedented situation and I want to give our people some certainty about the months ahead,” he said. “This period requires sacrifices from us all, and I want our people to know we are all in this together,” he said.

Jansen tested positive for COVID-19 in early March, forcing him to work remotely from home.

Providing the country’s biggest broadband, phone line and mobile network, BT is battling to maintain connectivity as millions of people work from home.

In recent days it has also had to contend with arson attacks and the abuse of some staff from people who believe that 5G masts play a role in spreading the virus.

($1 = 0.8131 pounds)

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Rolls-Royce scraps targets, dividend on pandemic hit

LONDON (Reuters) – Rolls-Royce (RR.L) is scrapping its targets and final dividend to shore up its finances as the British aero-engine maker’s customers around the world ground planes due to the coronavirus pandemic.

Rolls, one of Britain’s most historic industrial names, which before the coronavirus crisis struck was trying to emerge from a multi-year turnaround plan, has suspended its dividend for the first time since 1987.

The company’s engines power Airbus (AIR.PA) and Boeing’s (BA.N) widebody jets but more than 60% of that fleet is now grounded, according to aviation data provider Cirium.

Rolls-Royce is paid by airlines based on how many hours they fly. Over the last six weeks, the headwind from coronavirus was about 300 million pounds, Rolls-Royce said, on flying hours which were 50% lower in March and expected to deteriorate further in April.

Chief executive Warren East said the company’s focus was on strengthening its financial resilience, and as such it would be looking at cutting its cash expenditure, including reducing salary costs across its global workforce by at least 10% this year.

Rolls-Royce also said on Monday it had secured an additional 1.5 billion pound ($1.8 billion) revolving credit facility, bringing its overall liquidity to 6.7 billion pounds, to give it headroom during a potential prolonged downturn.

Withdrawing its previously announced guidance for 2020, and noting the ongoing uncertain outlook, Rolls-Royce said its board was no longer recommending its final dividend in respect of 2019, saving 137 million pounds.

The company said actions to reduce costs, including on non-critical capital expenditure projects and salary cuts and deferrals for senior managers, would have a cash flow benefit of at least 750 million pounds this year.

Rolls-Royce also warned it was anticipating a reduction in engine delivery and maintenance and overhaul volumes, affecting its revenues in the longer term. The group’s power systems business, which supplies industrial customers, is expected to weaken this year, the company said.

Jefferies analyst Sandy Morris said that Rolls’s update should give investors confidence in the company’s ability to cope with the downturn.

“There is plenty of liquidity. There are no worrying developments,” he said.

Shares in Rolls were up 13% at 284 pence in early trading. The stock has lost 55% over the last month.

Rolls-Royce relies on aerospace for just over half of its annual revenues, which were around 15 billion pounds in 2019, deriving the rest from its defence and power systems businesses.

($1 = 0.8163 pounds)

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How one Silicon Valley factory keeps running in the age of coronavirus

(Reuters) – The managers at Green Circuits — a small Silicon Valley electronics factory — thought they would have to close when the San Francisco Bay Area directed non-essential businesses to shut almost three weeks ago.

But messages soon flowed in from customers telling them their parts were needed for things like medical and defense equipment. One customer is now rushing to build ventilators that might use printed circuit boards made by Green Circuits.

    What happened next is occurring, in some form, at factories across the United States. While some, including sprawling auto assembly plants, have halted production lines and laid off or furloughed workers, those that make goods deemed essential are scrambling to keep moving and struggling to keep frightened workers on the job.

“The defense customers were the first to let us know” that they had to keep producing, said Joseph O’Neil, the company’s chief executive officer. They said “meet our delivery dates, or we will show up to help you do it,” he added.

His first move was to redesign the plant’s work schedule. The company, owned by the Dallas-based private equity firm Evolve Capital, always had the first and second shifts overlap for a half-hour. That allowed workers arriving in the afternoon to confer with colleagues as they handed off duties.

But O’Neil said they realized that would risk their whole workforce getting quarantined for 14 days, if someone got infected by the coronavirus and spent time at the factory as part of this larger group.

The solution was to create three separate teams of 40 workers each. The first shift now ends at 2 p.m., and then there’s an hour when the workspaces, tools, and breakrooms are sanitized. The third team does not work at all, but rather is held in reserve and available to jump in if an illness hampers one of the two other teams of workers.

    Within days, an even bigger problem emerged and continues to dog the factory: Workers balked at coming to the job, fearful that spending hours on the production line with coworkers might expose them and their families to the virus.

    O’Neil said the governor of California jolted his workforce when he broadened the shelter-at-home order to the entire state. That day, March 19, a few dozen elected to stay at home and requested a move to furloughed status.

“This put in jeopardy our ability to meet our ongoing commitments to essential efforts,” O’Neil wrote in an email as he was sorting through how to respond.

    The company began calling workers, pleading with them to keep going, and created a website — in English, Spanish, Korean and Vietnamese — to communicate updates on the safety measures they were putting in place and the essential nature of their work. The company assigned one worker on each shift to do nothing but move through the factory, cleaning surfaces.

    They were able to coax most of the workers back to the job, said O’Neil. But anxiety continued to grow.

A supervisor who runs the plant’s receiving dock sent O’Neil an email on March 23, complaining that his team meets at least 6 people every day. Who knows “what they have been exposed to,” he wrote, adding that his loading dock workers were the “most vulnerable” compared with other departments in the plant.

    About half of their customers are close enough to the factory that they were accustomed to dropping off and picking up goods, often without warning. Now, customers must only use shipping services, such as FedEx, and a “two-gate system” and use a video doorbell to talk to someone inside the factory. After the delivery driver leaves the goods, a worker comes out and wipes down the boxes before bringing them in to the factory.

The company is also evaluating a plan to use the ultimate retention tool: money. The proposal, not yet approved by the owners of the company, is to give workers an additional $2 an hour through April — which would be paid in December if the worker is still on staff. O’Neil said they would likely extend this for at least an additional two months — which could add up to a $1,000 bonus for each employee in December.

“This has been a weird, unique — and hopefully once-in-a-lifetime experience,” said O’Neil. “This is the stuff business schools will teach in the future.”          

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Global rush for gold is on amid coronavirus outbreak

From South Africa’s ultra-deep mine shafts to vaults underneath London, from metals traders in New York skyscrapers to main-street sellers of coins. The global gold market is being tested like never before.

Worldwide panic over the coronavirus outbreak and a flood of stimulus by central banks have ignited demand for one of humanity’s oldest methods of storing wealth. But even though there are literally thousands of tonnes of gold bars sitting in vaults around the world, it is suddenly much harder to get the metal when and where it is needed.

“Since last week, face masks, hand sanitisers, toilet rolls and bullion have something new in common – they run out when everyone tries to buy them,” said Mr Vincent Tie, sales manager at Silver Bullion in Singapore, last month.

Much of the world’s gold is stored in vaults in London, Switzerland and New York. The largest single depository is the New York Fed, which holds 497,000 bars stacked high on the Manhattan bedrock. In London, the Bank of England in the City of London holds a further 400,000 bars, while other vaults are operated by banks and logistics companies.

The gold market links these hubs with mines spread around the globe and refineries that buy up gold ore from miners. The refineries also take in scrap bars and jewellery and then produce bars and coins of various sizes – whatever is in highest demand.

Recently, three of the largest refiners, located in the canton of Ticino in Switzerland, were forced to close after the authorities ordered a lockdown.

“This isn’t anything that we’ve seen in a generation because refiners never had to shut down – not in war, not in the great financial crisis, not in natural disasters,” said Mr Tai Wong, the head of metals derivatives trading at BMO Capital Markets. “It’s never happened. And it happened astonishingly rapidly.”

The concerns over supply and the rush on gold purchases have sent futures in New York skyrocketing to the highest premium over spot gold in London in decades, underscoring how desperate investors are to find a safe haven amid the market tumult brought on by the virus.

It is also getting harder to transport gold because it typically flies around the world on ordinary commercial flights, which are being cancelled by the thousands. And while some flights are still moving, there is a limit to how much gold can go on each airplane.

It is not just weight but value – it is not possible to get insurance for more than a certain amount on any one plane. But it is not unheard of for nations to send military planes to ship their gold around the world, complete with armed escorts. In one sign of how things have slowed down, shipping Russian gold overseas can now take about a week instead of a day, said Mr Alexey Zaytsev, head of commodities and funding products at Otkritie Bank.

All these factors have combined to create a historic squeeze on New York gold futures. Typically, investors buy futures to get exposure to gold prices without having to worry about the day-to-day inconveniences of actually owning the metal, while banks use futures to hedge their physical metal exposure. However, if investors hold their futures contract to expiry, they will receive physical metal in a specific form: one 100oz bar or three kilobars.

Ordinarily, if the price of New York gold futures rises too far above gold prices elsewhere in the world, banks simply buy kilobars elsewhere in the world and fly them to New York. But the disruption of global supply chains has thrown that process into doubt.

The result has been a sharp spike in futures prices, making the metal in New York much more expensive than gold for immediate delivery in London. The surging difference – known as a spread – has rattled even veteran traders. Even mines are being disrupted. The industry-wide shutdown in South Africa – unprecedented in its 150-year mining history – is the most dramatic example. Operations are also being stopped or curtailed elsewhere, from Argentina to Canada.

The above-ground stocks of gold mean production disruptions are less important than for industrial metals such as copper. Still, the shutdowns will add to the shock waves rippling through the market.

It is at this point that things get really bad for short-sellers. To make good on maturing contracts, they would have to move actual gold from various locations. If they somehow managed to get a flight, there is another major problem.

Futures contracts in New York are based on 100oz bullion bars.

The gold that is rushed in from abroad is almost always a different size and there are no refiners that are open to help them re-melt the gold and re-pour it into the required bar shape.

Traders in need of physical metal went as far as to cold-call holders of gold bars in the hope that they were in possession of exchange-approved metal.

Some investors paid massive fees to have the remaining operating refineries mint new gold bars, according to people with knowledge of the matter.

Mr Peter Thomas, a senior vice-president at Chicago-based broker Zaner Group, said that a similar dynamic was playing out in other precious metals markets such as silver.

“This hasn’t happened before. We have a situation where there is silver available but no one will deliver it. They won’t load the trucks. They won’t load the planes because of the coronavirus. Even though there is product around, they won’t pick it up.”


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