EasyJet agrees new loans of £400m, Informa extends action plan

London open

The FTSE 100 is expected to open 35 points higher on Thursday, having closed down 3.34% at 5,597.65 on Thursday.

Stocks to watch

EasyJet said it expected to report a half pre-tax loss of £360m - £380m as it agreed new loans worth £400m in order to strengthen its balance sheet against the coronavirus pandemic's impact which grounded its entire fleet. It added that it intended to take no new aircraft deliveries in 2021 as the war of words with founder and majority shareholder Stelios Haji-Ioannou over a 107 plane order with Airbus intensified on Wednesday. In a letter to the Financial Conduct Authority, lawyers acting for Sir Stelios said the airline breached the UK's Market Abuse Regulation and Listing Rules since it did not obtain shareholder approval before agreeing a deferral on 24 Airbus planes.

Informa said on Thursday that it was now clear the path to the other side of the Covid-19 coronavirus pandemic would be “more gradual and phased” than it initially expected, and it was therefore extending its action plan through a series of enhanced measures to “ensure stability and strength in the period. The FTSE 100 company said it was temporarily suspending its dividends, having constructive discussions on a covenant waiver for its US PP debt, and had made an application to the Bank of England's Covid Corporate Financing Facility, alongside the proposed placing of further equity. It also said it was delivering at least £130m of direct and indirect savings, including the removal of all discretionary costs, a recruitment freeze and a board and leadership salary sacrifice, and was extending its postponement programme, with at least £460m of revenue rescheduled to the third and fourth quarter and less than 10% of events revenue cancelled to date.

Barratt Developments announced a 20% pay cut for its board and senior managers as the housebuilder said it was furloughing about 85% of its employees.

Newspaper round-up

Crawley has been identified as the place in Britain at highest risk of widespread job losses amid the coronavirus crisis, according to a report warning that the economic damage will fall unevenly across the country. More than half of all jobs in the West Sussex town are at risk of being furloughed or lost, according to the Centre for Cities think tank, which said Crawley’s high reliance on the aviation industry placed it at the heart of the economic storm. - Guardian

The Arcadia Group, which owns brands including Topshop, Dorothy Perkins and Miss Selfridge, is estimated to have cancelled in excess of £100m of existing clothing orders worldwide from suppliers in some of the world’s poorest countries as the global garment sector faces ruin. According to data from the Bangladesh Garments and Manufacturing Association (BGMEA), the Arcadia Group has cancelled £9m of orders in Bangladesh alone. – Guardian

Retailers experienced the worst fall in sales on record last month as shops were forced to shut up and down the country. Total sales fell by 4.3pc in March, compared with 1.8pc decline for the same month last year, figures from the British Retail Council (BRC) and KPMG showed. It was the sharpest decline in the 25 years that the numbers have been collated. – Telegraph

BDO has become the biggest accounting group to announce plans to furlough its staff, while partner pay at Deloitte and EY is to be cut by a fifth. They are the latest firms to tighten up on their workforces as the professional services sector prepares for a coronavirus-related slump in revenues. – The Times

The banking industry has been criticised for a lack of clarity in data it published recording the provision of emergency state-backed credit to companies whose trade has been damaged. UK Finance, the banking trade body, said that £1.1 billion had gone to 6,020 borrowers via the coronavirus business interruption loan scheme. – The Times

US close

US stocks closed lower on Wednesday as concerns about how long the coronavirus lockdown will last and what its after-effects may be, as well as some disappointing data and earnings, weighed on sentiment.

At the close, the Dow Jones Industrial Average was down 1.86% at 23,504.35, while the S&P 500 was 2.20% softer at 2,783.36 and the Nasdaq Composite saw out the session 1.44% weaker at 8,393.18.

The Dow closed 445.41 points lower on Wednesday after seeing out the previous session in the green as market participants seemingly grew more optimistic regarding the Covid-19 pandemic as the corporate earnings season kicked off.

While news that the pandemic was easing drove stocks higher in the previous session, with Donald Trump stating he believes certain states would be able to lift the strict social distancing measures that have strained their economies before the end of April, some dismal earnings from US companies were now spooking investors.

Bank of America posted a 45% decline first-quarter profit and braced for big loan losses as a result of the Covid-19 pandemic, while Citigroup and Goldman Sachs both posted sharply lower profits.

However, insurer United Health beat quarterly profit estimates and maintained its 2020 outlook despite the pandemic.