Japan faces another wave of infections in Tokyo and Fukuoka

Fears of a second wave

After recording no new Covid-19 cases from April 30 to May 22, the city of Kitakyushu in Fukuoka saw 119 cases in the past 11 days, putting it on the front line of Japan’s second wave of infections.

Among them are 11 students from four elementary and junior high schools, prompting school closures again and the shutdown of public facilities such as art galleries that were allowed to reopen on May 18.

Over in Tokyo, 34 new cases were recorded yesterday – the first time since May 14 that the daily number of infections has risen above 30.

This marked a threefold increase from the 13 recorded on Monday, prompting Tokyo Governor Yuriko Koike to issue a “Tokyo alert” yesterday that could lead to renewed advisories for businesses to close and people to avoid non-essential outings.

This comes after the state of emergency was lifted in Fukuoka on May 14, and in Tokyo on May 25. “Small surges in cases had already been anticipated,” Dr Shigeru Omi, the deputy head of the government expert panel on Covid-19 response, told a news briefing. “The nature of this virus at this point in time is that it is impossible to reduce the level of transmission to zero.”

Unlike on April 7, when the emergency was first issued, Dr Omi said Japan’s medical infrastructure is now more robust to withstand the rise in case numbers. On this basis, there is no imminent state of emergency, he said, adding: “The bottom line is that we must quickly move to respond to the situation and to avoid the further spread of the disease by identifying the chains of transmission.”

But for all of Japan’s best efforts, about one in three cases in Kitakyushu’s second wave has no known transmission links. Clusters have also occurred at two hospitals and one elderly home.

In Tokyo, 12 of the 34 new cases yesterday remained untraced.

Since May 26, Tokyo has recorded 124 new cases, of which one in four was an employee or customer at an entertainment district.

The governor said the “Tokyo alert” was aimed at building awareness among residents of how widely infections are spreading in the capital. “It doesn’t mean we are (immediately) changing our plans to reopen social and economic activities, but we want to reiterate our request that people refrain from night-time activities.”

But it remains to be seen if her warning will fall on deaf ears, with many having embraced their newfound freedoms. Tokyo on Monday began phase two of its three-part plan to reopen businesses.

In the first phase, museums, libraries and schools were allowed to open, while the second phase lifted shutdown requests for cinemas, gyms and department stores. Crowds have returned to pre-emergency levels, with footfall in Ginza and Shibuya up 4 per cent and 6.7 per cent, respectively, compared with just before the decree was issued in April.

There were 17,000 cases in Japan as of last night, with 901 deaths, according to a tally by NHK.

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Japan's elderly workers, once key to Abenomics, suffer as pandemic closes businesses

TOKYO (Reuters) – On a recent Saturday in Tokyo’s Shinjuku district more than 100 people, many of them elderly men, stood close together in a long queue waiting for food hand-outs.

One of them, Tomoaki Kobayashi, said he was fearing the day he would lose his home as his pension alone was not enough to pay the rent. Still spry, the 72-year-old said he lost his job cleaning pachinko parlours after many of the gambling halls were shut in a state of emergency imposed because of the coronavirus.

“This is the final month. I can’t pay any longer,” Kobayashi said of his rent, clutching a small sack of groceries – snacks, instant curry and hashed-beef rice that would feed him for the next few days. He said he had paid pension premiums for just 15 years, unlike the 33 years for most pensioners, meaning he is eligible for only 54,000 yen ($500) every two months.

Elderly Japanese became an increasingly important part of the labour pool after Prime Minister Shinzo Abe launched his “Abenomics” policies in 2012 to revive the world’s third-largest economy.

In a country with the world’s oldest population and lingering unease about immigration, elderly workers fill roles as shop clerks, cleaners and taxi drivers. For some, the work provides an additional boost to a pension and considerable savings. But for lower-income workers like Kobayashi, part-time jobs are a lifeline.

Now, the coronavirus has shuttered shops and offices and left some of the most vulnerable members of the labour force untethered, even as they are more at risk from the disease than other age groups.

“Elderly who have to work because of low pensions are facing tough conditions,” said Takanori Fujita, who co-heads a network of non-profit workers, lawyers and academics tackling social issues caused by the outbreak.

“We’re holding consultations (with elderly) no longer able to pay their rent or electricity bills,” he said.

About 13% of the labour force are aged 65 or older, up from 9% when Abe returned to power in 2012, according to government data. More than three-quarters of elderly workers are non-regular employees, part-timers and contract workers who are the first to lose their jobs when business is under pressure.

HARD TO START OVER

“I think it’s hard for them to start working again if they lose their job once,” said Taro Saito, an executive research fellow at NLI Research Institute.

The jobless rate hit a one-year high of 2.5% in March, a rate that is the envy of many nations. Still, an increase would further dampen demand and more elderly out of work could put greater strain on social services as Japan braces for its worst postwar economic slump.

“Japan isn’t a country like the United States where the unemployment rate rises and falls greatly,” said Saito. “The negative impact is big even if it rises by just 1%.”

Nearly a fifth of elderly Japanese live in relative poverty, meaning their income is less than half of the national median household income. The average for over 65 across the Organisation for Economic Cooperation and Development is just shy of 14%.

Single-person households that consisted of unemployed people aged 60 and over in 2018 had on average about 123,000 yen in real income per month, coming mostly from pensions. Compared to their expenses, those households had a shortfall of about 38,000 yen a month, government data shows.

Tsuyoshi Gonda, 60, applied for unemployment benefits after he was laid off from his full-time job as a hairdresser in Tokyo’s Katsushika area in mid-April.

That was not long after Abe called for the state of emergency because of the coronavirus, urging people to avoid crowds and prompting many businesses to shut.

“The number of customers dropped to zero a day after the emergency was in place,” Gonda said. “It was a shop where people decided to come on the day. It was very harsh.”

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Most JGBs gain after solid 20-year debt auction

TOKYO, May 20 (Reuters) – Most Japanese government bond prices rose on Wednesday after a 20-year debt auction drew solid demand from dealers.

The bid-to-cover ratio, a gauge of demand, at the 900 billion yen ($8.35 billion) 20-year debt sale rose to 4.25 from 3.58 at the previous auction in April. Analysts said the demand was stronger than expected.

The auction’s tail, or gap between the average and lowest accepted prices, tightened to 0.06 from last month’s 0.11.

Benchmark 10-year JGB futures barely moved at 152.27, with a trading volume of 9,443 lots, and the 10-year JGB yield was flat at minus 0.005%.

The 20-year JGB yield fell 1.5 basis points to 0.330%. The 30-year JGB yield was down 2 basis points to 0.455%.

At the short end of the market, the two-year JGB yield and the five-year yield stood flat at minus 0.165% and minus 0.125%, respectively. ($1 = 107.7600 yen) (Reporting by Eimi Yamamitsu; Editing by Subhranshu Sahu)

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Las Vegas Sands ends plans to open Japan integrated resort casino project

TOKYO (Reuters) – Las Vegas Sands said in a statement on Wednesday it has ended its plans to open an integrated resort (IR) casino in Japan.

“The framework around the development of an IR has made our goals there unreachable,” Sands Chairman Sheldon Adelson said in the press release.

The move comes after the casino operator in January expressed its bullishness on Japan and put on magic shows and Broadway musical numbers to drum up enthusiasm for the industry at an exhibition in Yokohama.

Japan wants to build several integrated resorts – Las Vegas-style complexes that include casinos, shopping arcades and conference centres – although a bribery scandal has hardened public opposition to the plans.

The government has authorised licences for three integrated resorts and has been expected to receive bids officially from interested cities in 2021.

Potential bidders include Yokohama, Tokyo, Osaka – Japan’s three largest cities – and smaller cities including Nagasaki and Wakayama.

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Japan to approve its first antigen coronavirus test kits on Weds

TOKYO (Reuters) – The Japanese Health Ministry is set to approve antigen coronavirus testing kits on Wednesday, a ministry official said on Tuesday, in a move to boost the number of diagnostic tests available to battle the pandemic.

Fujirebio, a subsidiary of Japanese diagnostics and laboratory testing service provider Miraca Holdings, last month applied for government approval for Japan’s first antigen coronavirus testing kits.

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World shares mixed amid hopes for business pickup, weak data; oil slides

NEW YORK/LONDON (Reuters) – World equity markets were mixed on Wednesday, with U.S. indexes seesawing amid hopes for a pickup in business activity and as oil prices slumped with demand low after a rise in U.S. crude stockpiles last week to three-year highs.

The safe-haven Japanese yen and dollar rose after economic data showed U.S. private payrolls tumbled last month to a record 20.2 million, German industrial orders fell at a record pace in March and UK construction activity crashed to an all-time low in April.

The dollar index rose 0.359%, with the euro down 0.36% to $1.0799. The Japanese yen strengthened 0.49% versus the greenback at 106.10 per dollar.

Retail sales in the euro zone also suffered their largest decline on record in March.

Demand has collapsed globally because of the coronavirus epidemic and many investors viewed the prospect of a swift recovery as bleak, despite the gradual opening of economies worldwide that has given hope to other investors.

Trying to gauge economic growth in light of the pandemic has sent investors scurrying for new insights, especially in China, where the economy was first to re-open, said Yousef Abbasi, global market strategist at INTL FCStone Financial Inc in New York.

“When are you going to see those businesses retake capacity comparable to the last year? That’s the big question,” Abbasi said. “It really is about where you think demand is going to come back or where you think demand never really dropped off.”

The pan-European STOXX 600 index lost 0.37% while MSCI’s gauge of stocks across the globe shed just 0.07%.

On Wall Street, the Dow Jones Industrial Average fell 49.71 points, or 0.21%, to 23,833.38. The S&P 500 lost 0.82 points, or 0.03%, to 2,867.62 and the Nasdaq Composite added 84.88 points, or 0.96%, to 8,894.00.

The blue-chip Dow Jones index came under pressure from declines in oil giant Chevron Corp as crude prices fell. The S&P 500 energy sub-index dropped 2.2%.

General Motors Co jumped 5% after the automaker topped first-quarter profit expectations and outlined plans for a May 18 restart of most of its North American plants.

CVS Health Corp gained 2.3% after reporting a better-than-expected quarterly profit.

Oil slid below $30 a barrel as crude stocks rose and gasoline demand remained below normal seasonal levels, snapping a six-day winning streak for Brent futures that helped the global benchmark almost double in price from a 21-year low on April 22.

U.S. crude inventories rose by 4.6 million barrels in the week to May 1 to 532.2 million barrels, compared with analysts’ expectations in a Reuters poll for a 7.8 million-barrel rise. [EIA/S]

U.S. crude fell 5.9% to $23.11 per barrel and Brent was at $28.77, down 7.1% on the day.

Healthcare stocks rose in Europe on the back of better-than-expected quarterly results from Denmark’s Novo Nordisk and German dialysis specialist Fresenius Medical Care.

“Earnings season is not great, but it’s really the issue of the virus and the end of the lockdown, and sentiment towards that will push the market,” said Francois Savary, chief investment officer at Swiss wealth manager Prime Partners.

China opened for the first time since Thursday and reversed early losses, sending its blue-chip index up 0.6%.

In a move seen by analysts as offering a olive branch to Washington amid the trade tensions, China’s central bank set the yuan at a broadly neutral midpoint. The exchange rate has been a contentious point in China-U.S. ties.

U.S. President Donald Trump has repeatedly taken aim at China as the source of the pandemic and warned it would be held to account. On Tuesday, he urged China to be transparent about the origins of the coronavirus, which began in the Chinese city of Wuhan late last year.

Spot gold dropped 1.1% to $1,687.10 an ounce.

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