Sterling falls against the euro, but shares continue rally on virus ease hopes

Sterling slipped to just over 88p against the euro on growing concern for British prime minister Boris Johnson’s health after he was admitted to intensive care to treat his coronavirus symptoms.

Sterling slipped to just over 88p against the euro on growing concern for British prime minister Boris Johnson’s health after he was admitted to intensive care to treat his coronavirus symptoms.

The pound, however, gained against the dollar.

European shares rallied for a second straight day, however, with investors focusing on early signs that the pandemic may be easing. After having risen as much as 3.3% during the day, the pan-European Stoxx-600 index closed up 1.9%, at its highest level in nearly a month.

International cinema operator Cineworld — which owns the multiscreen cinema complex on Dublin’s Parnell Street — has suspended shareholder dividend payments and has entered talks with its lenders to cover its liquidity requirements and landlords over rent.

The British company last month warned it could fail to meet its debt repayment commitments in a worst-case Covid-19 scenario. Its worst-case scenario is its cinemas being closed for up to three months. The company’s debt stands at €3.2bn. However, that excludes property leases and financing around its planned $1.65bn takeover of Canadian rival Cineplex.

That deal would see Cineworld taking on additional financing of $2.2bn.

Meanwhile, the UK’s big supermarket chains fear they won’t be able to cope with rising consumer demand without being granted longer opening hours or being able to relax social distancing rules.

Supermarkets fear that under the current restrictions, they simply cannot physically meet the demand.

“The problem is, can you feed 60 million people at the rate you can get people through the stores with that social distancing?” one industry executive said.

Elsewhere, UK mortgage lender Halifax has declared Britain’s housing market as being largely on pause due to that country’s lockdown.

Halifax said the move will make it difficult to calculate house price movement, but it remains too soon to gauge long-term impact.

Meanwhile, car hire firm Europcar, also hit by the coronavirus outbreak, is in talks with banks on a €223m liquidity line guaranteed by the French government.

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