Japan has suffered its worst drop in exports since the financial crisis over a decade ago , denting hopes that the world economy could be turning the corner.

Japanese exports slumped by almost 22% year-on-year in April, led by tumbling demand for cars and industrial goods.

Exports to the US were down 37.8%, with auto exports down by two-thirds.

Shares in budget airline easyJet have jumped 5% in early trading, after it announced it will resume some flights from mid-June.

Face masks will be compulsory, as the airline tries to operate while obeying physical distancing rules.

My colleague Jo Partridge explains:

The airline initially will restart domestic routes in the UK and France where it believes “there is sufficient customer demand to support profitable flying”. The carrier will add further routes in the following weeks, as and when passenger demand rises and lockdown measures ease further across Europe.

The company will introduce enhanced cleaning and disinfection of its aircraft, will make disinfectant wipes and hand sanitiser available on board, and will require all passengers and cabin crew, as well as ground crew, to wear masks. There will be no food service onboard, initially.

Hotels group Whitbread are the top faller in London, down over 16% after announcing a £1bn rights issue.

This will shore up Whitbread’s finances to handle the Covid-19 recession.

It told investors that the funds will give it the “confidence and flexibility” to keep operating and invest in the UK and Germany. The firm reckons there are opportunities to expand, as “its budget-branded and independent competitors are expected to be weakened by the COVID-19 pandemic”

More ominously, the money will also provide “further liquidity headroom in the event of a resurgence of the COVID-19 pandemic”.

Investors can buy one new share, at £15, for each two they already own. That’s a 37.4% discount on the “theoretical ex-rights price of £2,395”. Shares in Whitbread have fallen smartly to this level, down 440p at £24.01.

Whitbread, which owns Premier Inns, had entered the crisis with £300m in the bank and a £950m revolving credit facility. But the lockdown means it faces a “very material loss of revenue” for the current financial year, having already furloughed staff and shut hotels.

Anxiety over US-China relations is weighing on the London stock market.

The FTSE 100 index has dropped by 50 points, or 0.85%, in early trading to 6,016. France and Germany are both down over 1%.

Consumer-focused companies, technology firms, and financial groups are among the fallers — reflecting worries over the global economic outlook.

Overnight, the US intensified its criticism of China by issuing a new report which criticises Beijing activities.

Associated Press has the details:

Beyond its hard-hitting rhetoric against China over its handling of the coronavirus, the White House has issued a broad-scale attack on Beijing’s predatory economic policies, military buildup, disinformation campaigns and human rights violations.

The 20-page report does not signal a shift in U.S. policy, according to a senior administration official, who was not authorized to publicly discuss the report and spoke only on condition of anonymity, but it expands on Trump’s get-tough rhetoric that he hopes will resonate with voters angry about China’s handling of the disease outbreak that has left tens of millions of Americans out of work.

US secretary of state Mike Pompeo has also launched a stinging attack on China’s government, calling it a “brutal, authoritarian regime” that is “ideologically and politically hostile to free nations”:

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Just as anxiety over the Covid-19 pandemic was easing, the prospect of a new US-China trade dispute is looming over the markets again.

Donald Trump has alarmed investors with another stinging attack on Beijing’s handling of the pandemic — accusing them of spreading “pain and carnage” around the world.

He also appeared to single out president Xi Jinping personally, tweeting that “it all comes from the top” — fuelling concerns that the trade deal agreed last year between the two sides could crumble.

With an eye on November’s election, Trump also claimed that his democratic rival Joe Biden was now China’s preferred candidate.

With world trade already shrinking alarmingly under the pandemic, the world economy certainly doesn’t need rising tensions between these two powers.

Trump’s blast has rather dampened the mood in the markets, where shares yesterday hit their highest levels since early March.

China’s CSI 300 index has dipped 0.5%, and European stock markets have just dropped 1% at the start of trading.

Fiona Cincotta of City Index explains:

President Trump escalated rhetoric against China pointing the finger at Xi Jinping for a disinformation campaign and propaganda attacks on both the US and Europe.

Whilst Trump playing the blame game with China is nothing news, this is the first time that he has taken direct aim at Xi Jinping. Previously he has always maintained a strong relationship between the two. This change of tone is making the markets sit up and listen. Riskier assets are out of favour and flows into safe havens are on the rise.

Also coming up today

The latest surveys of purchasing managers in the UK, US and eurozone will show how much economic damage is being caused by the lockdown – and whether business leaders are any less pessimistic about the future. These PMI reports are expected to be better than April’s horror show, but still show that economies are shrinking.

And brace for another shocking US unemployment report – the weekly ‘initial claims’ survey is expected to show that another 2.4 million Americans lost their jobs last week.

The agenda

• 9am BST: Eurozone ‘flash’ manufacturing and services PMIs for May
• 9.30am BST: UK ‘flash’ manufacturing and services PMIs for May
• 11am BST: CBI’s industrial trends survey of UK manufacturing
• 1.30pm BST: US weekly jobless claims report
• 3pm BST: US ‘flash’ manufacturing and services PMIs for May