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It’s day 62 since Canada’s 100th coronavirus case. The number of cases is 69,905 as of publication time, up 1,057 since yesterday—a 16 per cent decrease from the seven-day prior average of new cases. On their respective 62nd day, U.S. daily new cases were down four per cent from the seven-day prior average; the U.K. was down eight per cent in daily new cases from the seven-day prior; and in Italy, new cases were up less than one per cent.*

Ottawa’s plan for Canada Inc.: The federal government will give loans of $60 million or more to companies “that make meaningful investments in Canada, and provide jobs to Canadians,” and that have annual revenues of at least $300 million, Finance Minister Bill Morneau announced Monday. Firms applying to the Large Employer Emergency Financing Facility (LEEFF) must commit to holding on to staff, making annual climate impact disclosures and placing “strict limits” on executive pay. Conditions will include “making sure that there’s no share buybacks or dividends” funded by the government’s credit, Morneau said—a use over which U.S. policymakers have expressed concern. 

The new program will offer loans on commercial terms, and it’s designed to be credit of last resort. “The company would be coming to the government after they seek their current sources of funding … whether it’s through markets or their banking relationships,” Morneau said. The Canada Development Investment Corporation—which manages the federal government’s stakes in the Hibernia oilfield and the Trans Mountain pipeline and previously held shares in General Motors and Chrysler, acquired in the 2009 financial crisis bailout—will run the LEEFF; Innovation, Science and Economic Development Canada will provide input on “broader sectoral dynamics.” Prime Minister Justin Trudeau said the government is trying to avoid bankruptcies and job losses. “These are bridge loans, not bailouts.”

Ottawa is also raising the caps on the Business Credit Availability Program to allow firms to borrow up to $60 million and access loan guarantees of up to $80 million through their financial institutions. Firms need to have been “financially stable and viable prior to the current economic turmoil,” and will typically have $100 million-plus in annual revenue, the Business Development Bank of Canada (BDC) said. Under the existing program, BDC provided 80 per cent of the funding for credit up to $6.25 million, while Export Development Canada underwrote a similar share of operating and cash-flow loans. 

Morneau didn’t directly answer reporters’ questions about whether he was still working on sector-specific support measures, which he first signalled in late March. He instead noted that the LEEFF is open to firms in all industries, except financial institutions. The Canadian Chamber of Commerce and the Business Council of Canada both welcomed the program.

In the markets: The Dow Jones dropped 0.45 per cent today, while the TSX, S&P 500 and Nasdaq all posted gains. The Nasdaq rose 0.78 per cent, its sixth consecutive day of gains, marking its longest streak since December. All major North American indices had been down in early-morning trading over concerns about rising U.S.-China trade tensions and a jump in coronavirus cases in South Korea and Germany. The late-day rally was once again driven by tech stocks, with that sector of the S&P up 0.5 per cent, behind only the health-care sector, up 1.4 per cent. Canadian stocks were hit by a drop in oil prices on concerns about another wave of COVID-19 cases. The drop was stemmed somewhat by Saudi Arabia’s announcement it would cut oil output in June to around 4.8 million barrels per day, pushing output to its lowest levels in almost two decades. However, the Canadian Crude Index was still down 0.77 per cent in late afternoon trading, and the dollar fell to 71.33 cents U.S.

Macroeconomic indicators, meanwhile, remained largely gloomy. China said it would step up macro policy adjustments, including having its central bank keep monetary policy flexible. Nearly 90 per cent of U.S. small businesses are bracing for an economic slowdown, and 65 per cent intend to tap government relief programs or have already done so, according to a survey conducted by global payment firm Veem. There’s some good news. Market volatility levels have dropped to their lowest since February 26, which some funds are taking as a sign to increase their equity exposure. Investors are pushing the stock prices of America’s largest landlords up after they posted better-than-expected rent-collection numbers during the pandemic. 

“We protected the banks in 2008, so let’s protect cinemas, theatres and bookshops in 2020. Personally, to live, I need my bank. But I also need cinema”: On the eve of what would have been the opening of the 73rd Cannes Film Festival, festival head Thierry Frémaux discussed how films survive the pandemic.

Cross-country checkup: Thousands of elementary school students in Quebec were back in class Monday for the first time in eight weeks, while researchers in the province are just beginning to study children’s role in spreading COVID-19. McGill and Concordia universities are moving most of their classes online for the fall. Cargill’s meat-processing plant near Montreal has closed after at least 64 workers tested positive for the virus; it’s the company’s second Canadian plant to close due to an outbreak. Newfoundland and Labrador is easing lockdown measures, allowing some businesses like law firms and daycares to reopen. Gatherings of up to 10 people will be allowed for funerals, burials and weddings, and municipal parks and golf courses will open. 

Startup hiring spree: Canada’s tech sector has been hit hard during the pandemic, with thousands of layoffs at startups and some of the largest companies reducing hiring. The Logic spoke with about a half-dozen firms, including Coveo, Dialogue, Trulioo and Beatdapp, that are looking to fill the gap, picking up talent from rivals and expanding while others pull back.

Toronto pushes Main Street online: The city’s small businesses and artists have been grappling with how to stay afloat amid the economic fallout of the pandemic, as brick-and-mortar operations were ordered to close. The City of Toronto is offering help with a new initiative called ShopHere, which will create online stores by the end of August for 3,000 businesses. Volunteers recruited by Digital Main Street will create these stores, and students from York University’s Schulich School of Business will teach businesses how to operate them.

Bay Street to Main Street: Consumer insolvencies dropped in the first quarter of 2020, but the worst is yet to come, according to the Canadian Association of Insolvency and Restructuring Professionals (CAIRP). Insolvencies dropped 5.5 per cent quarter over quarter and 8.4 per cent in March year over year, despite the pandemic. “For those who were already overstretched with more debt than they could reasonably afford, the government relief and short term payment reprieve have allowed many to stay afloat. But their underlying debt is a gaping hole in the lifeboat,” said CAIRP chairman Mark Rosen. 

• Canada’s banks issued a record high of 38 covered bonds—debt securities backed by assets like residential mortgages—in the past two months, raising almost $100 billion. By contrast, banks sold 24 covered bonds in all of 2019. 
• Retail grocery sales rose 40 per cent year over year for the week ended March 21, then dipped to a 19 per cent increase for the week ended April 11. 
• Cirque du Soleil has hired National Bank of Canada to advise on either selling the company or negotiating a cash infusion from its current owners. 
• Canadian gold firm SSR Mining is buying U.S.-based Alacer Gold in an all-stock deal worth $2.4 billion. 
• Toronto-based Dream Unlimited is launching a private equity arm and intends to raise billions to invest in commercial property in North America and Germany post-pandemic. 
• Government-backed loan criteria are cutting out a number of shadow banking lenders.

Crowdsourcing the crisis: Lending Loop, a credit-monitoring and -lending platform, has launched a free QuickMatch tool for small-business owners to identify government relief programs for which they are eligible.

Postcard from Paris: “Today is the un-lockdown,” Marilène Garceau said, as she looked out her balcony window on a clear day. Many in France were allowed to leave their homes without government permits today for the first time in eight weeks. Under the lockdown, Garceau was shocked to see people not looking at each other, smiling or saying hello, which she took as an expression of fear. While there were more cars and people outside today, Garceau—the president and founder of Kennedy Garceau, a human resources company that helps French companies looking to hire Canadian workers (or vice versa)—chose to continue working from home, avoiding her 45-minute-plus commute. “I didn’t go out outside yet,” she said. “I really didn’t do anything different than the other days of the confinement…. I’ll be Canadian and follow the rules, but I might change some things. Instead of taking the bus, I’ll walk to the metro every day.”

When the pandemic hit, much of Garceau’s job was put on hold. “I can’t help anybody at this time,” she said. “How do you persuade someone to look forward to a move or a new job when it’s all out of our control?” Around this time last year, Garceau had helped a French woman hired by a Canadian company apply to immigration. That company has since laid off several of its own employees; it no longer has the same projects for which it hired her client, so her move is now on hold. Garceau also knows several people who were supposed to leave Canada to work in France this spring: “I’m wondering if [the company] will tell them to wait or if they postpone their start or just cancel it?” 

To pass the time these eight weeks, Garceau has kept a running “weekly meeting” with her family in Quebec. Much of her time in the lockdown went into planning the days for her 12-year-old daughter. Her suburb is in the red zone, so schools haven’t opened yet. “I used to take calls in the evening,” she said. “The one thing I did when the confinement started was block the evenings for family time. No calls.”  

Drinking from the firehose: 

• Saudi Aramco is trying to renegotiate a deal to buy a 70 per cent stake in Saudi Basic Industries Corporation after the oil-price slump and COVID-19 pandemic triggered an over 40 per cent drop in value for the petrochemical maker.
• Cloudflare CEO Matthew Prince said the firm, which builds and sells cybersecurity tools, has seen a significant rise in cyber attacks since lockdowns began. While he said most attacks appear to be “bored kids who are home from school and just trying to test things out,” there has been an uptick in state-sponsored attacks in the last few weeks.
• Online used-car platform Vroom has filed confidentially to go public, likely in June; its public competitor Carvana is trading near record highs, despite the overall market sell-off. 
• The largest U.S. cable providers lost more than two million customers in the first three months of the year, the sharpest quarterly decline on record, as offices, sports bars and hotels pause service. 
• The information and technology sector in the U.S. lost 112,000 jobs in April, erasing a year’s worth of hiring in one month. 
• Tesla filed a lawsuit against Alameda County, Calif., in a bid to reopen its factory in the region. The suit claims California state rules allowing manufacturing to resume trump Alameda’s orders to stay home. The company outlined its plans for reopening in a blog post Saturday.
• Activist investor Elliott Management’s Travelport filed a lawsuit attempting to stop payment solutions firm Wex from abandoning its plan to buy two travel-payment businesses for US$1.7 billion. 
• Business intelligence firm ZoomInfo is planning to go public as early as June, in what would be the among first technology IPOs since the pandemic. 

The grand reopening: The U.K. government released its 51-page phased reopening strategy, which recommends the use of face coverings and allows elementary schools and shops to reopen as early as June 1. Belgium allowed shops to open from Monday: shoppers queued outside stores such as Ikea and fashion chain Primark; they allowed a maximum of 30 minutes per person. France allowed most people to leave home without government paperwork for the first time in eight weeks, as businesses also reopened. Children in Switzerland returned to schools after a nearly two-month break. Denmark has cut social-distancing measures in half to about three feet. India, which relaxed its lockdown for businesses today, will reopen its rail network on Tuesday after a nearly seven-week lockdown. Chile is foregoing its plans to give out immunity cards, with its health minister saying they “could trigger a severe problem of discrimination.” 

Around the world: Wuhan, the Chinese city where the outbreak started late last year, has reported its first cluster of cases since April 3. Saudi Arabia will triple its value-added tax rate to 15 per cent in an attempt to deal with the economic impact of the pandemic. France is looking to increase its €4-billion bailout package for tech startups by over 50 per cent. The U.K. is fast-tracking a trial run of e-scooters from next year to next month. Three top U.S. health officials, including Dr. Anthony Fauci, will self-quarantine for two weeks after coming into contact with White House staff who tested positive for the virus. Masked visitors to Shanghai Disneyland Park had their temperatures taken on the first day of opening; a maximum of 24,000 people are allowed in each day, roughly 30 percent of the park’s regular capacity.

The coronavirus hairstyle: Children in East Africa are sporting a trendy new hairstyle: braided, red spikes that mimic the virus’s shape. 

* We’re emphasizing new cases, rather than running totals, because “flattening the curve” is when each day’s new cases are fewer than those of the previous day. The percentage increase is determined based on how today’s cases compare to a rolling seven-day prior average. Numbers may also vary based on countries’ individual testing capacity and reporting.

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