Business Fallout: Hong Kong Express to halt flights til May

Less than three months ago came the first reports of cases of pneumonia related to a virus first detected in Wuhan, China. The outbreak of the virus that causes COVID-19 has caused unprecedented disruptions that have brought an unparalleled shock to the global economy.

Following are developments Friday related to the outbreak, efforts by governments to stabilize their economies, companies that must navigate through an altered landscape, and the millions of people affected.

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AIRLINES: The Hong Kong low-cost airline HK Express, part of the Cathay Pacific Group, is suspending all flights through the end of April due to falling demand from the coronavirus outbreak. The airline said it tentatively plans to resume flying May 1. HK Express normally flies 25 routes throughout Asia. The decision adds to a wave of flight cancellations by Asian airlines as demand plunges amid travel curbs. Cathay's flagship carrier, Cathay Pacific Airways, has cut 90% of flights and asked staff to take unpaid leave. Airlines already were suffering from a downturn in visitors due to political protests last year. Meanwhile, American Airlines said it will operate cargo-only flights between the US and Europe. FedEx and UPS were expecting a greater share of cargo as passenger airlines cut flights using their planes, which carry cargo in their bellies.

In the U.S. and elsewhere, airlines are lobbying for taxpayer cash to keep flying through the virus outbreak, despite failing to win White House support for $29 billion in grants. Thirty airline-industry groups appealed Thursday to congressional leaders and Treasury Secretary Steve Mnuchin for immediate and long-term help “in the form of grants, unsecured loans and limited tax measures. The survival of our industry depends on it." President Donald Trump's administration is supporting $50 billion in secured loans, but not endorsing grants or billions more in tax relief. Consumer advocates and many Democrats in Congress want to tie any help for the airlines to specific measures including aid for workers, limits on ticket-change fees, and a ban on stock buybacks.

MARKETS: Asian stock markets were mostly higher Friday after Wall Street gained on hopes government aid and central banks can shield the global economy against the rising impact of the coronavirus pandemic. Benchmarks rose in Hong Kong, Shanghai and Sydney. On Wall Street, the benchmark S&P 500 index rose 0.5% in a relatively modest change compared with violent price swings over the past week. Investors were encouraged after seeing more steps by the Federal Reserve and other central banks as well as governments to support credit markets and the economy. Forecasters say a global recession looks increasingly likely.

RETAIL RIGORS: Department store chain Kohl's Corp. said late Thursday that it has fully drawn its $1 billion unsecured credit facility to bolster its cash and ''preserve its financial flexibility." The chain, based in Menomonee Falls, Wisconsin, is withdrawing its fiscal full year and first-quarter guidance and slashing its inventory and expenses. Kohl's has announced temporary closures of its 1,100 stores through at least April 1. It and many other major chains are temporarily closing stores to curb the spread of the coronavirus. Several other chains like Nordstrom and Abercrombie & Fitch have also withdrawn their guidance given so much uncertainty.