Yahoo Finance What to watch: Wirecard collapses, EasyJet raises, stocks choppy
Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:
Payments firm Wirecard collapses into insolvency
German payments firm Wirecard (WDI.DE) on Thursday collapsed into insolvency, just days after a €1.9bn (£1.7bn, $2.1bn) hole in its accounts came to light.
In a statement, the company said that it had decided to apply to the Munich district court to open insolvency proceedings, citing “impending insolvency and over-indebtedness.”
Shares of the company were suspended on the Frankfurt Stock Exchange prior to the announcement.
After claiming last week that the €1.9bn had gone missing from escrow accounts in the Philippines, and that it may have been the victim of “considerable fraud,” Wirecard then admitted that there was “a prevailing likelihood” that the funds did not exist.
Over the weekend, banks in the Philippines said documents produced by Wirecard appeared to be false, and the country’s central bank also said the money had never entered its financial system.
EasyJet raises £419m in battle to survive crisis
EasyJet (EZJ.L) has raised around £419m ($520m) by issuing new discounted shares, shoring up its finances as the airline industry battles to survive the pandemic.
The budget airline has already announced plans to slash around 4,500 jobs, after warning it does not expect demand to reach pre-virus levels for another three years.
It said in a statement it had placed new shares worth around 15% of its existing shares at a 5% discount on their value at the close of trading in London on Wednesday (24 June).
The company said it had consulted with major shareholders on the move, and was “pleased by the strong support it has received.”
Royal Mail to cut 2,000 management jobs
The Royal Mail (RMG.L) said on Thursday that it would axe around 2,000 management jobs as part of plan to save £300m ($373m) in costs in the wake of the coronavirus crisis.
Citing “long-standing” shifts to its business, the company said that the pandemic had hastened the decline of its letters business, with customers instead sending more parcels.
A management restructure, part of a three-stage cost-cutting plan, will see around 2,000 roles eliminated, with the Royal Mail hoping to save £130m next year and a further £170m in the following year.
"In recent years, our UK business has not adapted quickly enough to the changes in our marketplace of more parcels and fewer letters. COVID-19 has accelerated those trends, presenting additional challenges,” said Keith Williams, the interim executive chairman of the Royal Mail group.
Qantas axes 6,000 staff in 'very painful' cutbacks
Australian airline Qantas (QAN.AX) has announced at least 6,000 staff will lose their jobs, as the coronavirus continues to wreak havoc with the travel industry worldwide.
Qantas said another 15,000 employees would continue to be stood down with flight schedules sparse, effectively meaning a period of unpaid absence.
Around 100 aircraft will be grounded for up to 12 months, including most of its international fleet. Only around 15,000 of its 29,000 staff are expected to be back in work by the end of the calendar year.
The measures form part of the group’s “post-COVID recovery plan” announced on Thursday. The plans are estimated to cost around A$1bn (£54m, $68m), but the company expects them to save A$15bn over the next three years.
European stocks choppy amid spiralling outbreak in US
European stocks reversed earlier losses on Thursday even as a continued surge in coronavirus infections in the US raised fears of a prolonged global recovery from the pandemic.
Around 37,000 new cases were reported in the US on Wednesday, the highest daily total since April, with the worst of the outbreak concentrated in the south and west of the country.
Amid a choppy trading session, the pan-European STOXX 600 index (^STOXX) rose by around 0.3%, while London’s FTSE 100 (^FTSE) declined marginally.
Germany’s DAX (^GDAXI) climbed by around 0.6%, while France’s CAC 40 (^FCHI) was about 0.3% in the green.
What to expect in the US
Futures were pointing to a lower open for US stocks on Thursday.
S&P 500 futures (ES=F) fell by around 0.3%, while Dow Jones Industrial Average futures (YM=F) declined by around 0.4%. Nasdaq futures (NQ=F), meanwhile, were down by around 0.1%.
