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First Move with Julia Chatterley

China's Economy Grows 18 Percent in the First Quarter; Morgan Stanley is the Latest Financial Giant to Deliver Strong Results, The Future of Pizza Delivery with Autonomous Vehicle Company, Nuro. Aired 9-10a ET

Aired April 16, 2021 - 09:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[09:00:33]

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Live from New York, I'm Alison Kosik, I am sitting in for Julia Chatterley, and this is First Move. And

here is your need to know.

Beijing bounce. China's economy grows 18 percent in the first quarter.

Banking beat. Morgan Stanley is the latest financial giant to deliver strong results.

And the future of pizza delivery. We're going to be speaking with the CEO of autonomous vehicle company Nuro.

It's Friday, let's make a move.

Welcome to FIRST MOVE. Great to have you with us this Friday. Let's begin with a look at the markets.

Futures are pointing to fresh gains for U.S. stocks in early trading today with the Dow and the S&P on track to hit new records. The Dow closing above

that 34,000 milestone for the first time ever on Thursday with sentiment getting a boost from stronger than expected March retail sales and the

lowest number of new jobless claims since the pandemic.

A positive start to earning season is boosting the case for the bulls, too. Morgan Stanley is the last of the big Wall Street banks to report better

than expected results. The company, however, reporting a more than $900 million loss tied to the Archegos Capital debacle.

The Archegos loss pressuring Morgan Stanley's stock a bit in the premarket. Shares currently look like they're on track for a gain of less than half a

percent.

European and Asian stocks are moving higher this Friday, too. Asia boosted by a flurry of encouraging Chinese data, suggesting its economic expansion

remains on track.

And that is where we begin today's drivers. China reporting its strongest quarterly GDP growth in nearly three decades. The country says its economy

grew more than 18 percent in the first quarter compared with a year ago.

Selina Wang joins us live with the details. Great to see you, Selina.

So, I want you to break down this massive jump in GDP growth because I'm curious if the headline really matches what we're seeing behind the scenes.

SELINA WANG, CNN CORRESPONDENT: Hey, Alison. That's exactly right. That is a jaw-draping number, more than 18 percent growth in the first quarter. But

this massive jump was expected, what this number shows is how much China's economy grew compared to the same period last year at a time when much of

China's economy was shut down because of the pandemic.

But as you say, even if we look beyond this headline number of GDP, the data still shows that China is on track for this continuation of this

strong rebound from the coronavirus pandemic.

If you look at retail sales, they took a big hit last year, they jumped more than 30 percent showing that the Chinese consumer is back. There was

also strong growth in investments in infrastructure and manufacturing. And if you look at trade data, imports and exports both jumped by more than 30

percent showing that demand within China is still strong.

And Alison, the backdrop here, of course, is that the global recovery has been stronger than expected as the vaccine rollout continues around the

world, both the U.S. and China are expected to be key drivers of global growth this year and that global recovery is going to help bolster China's

exports in this coming year -- Alison.

KOSIK: And Selina, as the recovery moves forward, I am curious with the short and long-term challenges that China's economy may face.

WANG: Well, in the short term, if you look at China's quarterly GDP growth that was actually lower than what some analysts were expecting. It only

came in at about 0.6 percent growth. So that shows that China is strong. Post-COVID rebound may actually be leveling off.

Now, if we look at the challenges in the long term, there are many of them. For one, you have unemployment that remains high. There are also continuing

geopolitical tensions that could hurt trade. U.S.-China tensions are of course a major risk. Beijing is also concerned about potential asset

bubbles, especially in the properties sector.

Very recently, you had China's top banking regulator saying that buying up property for investment or speculative purposes is extremely dangerous. In

addition to that, China is also dealing with a demographic challenge of rapidly falling birth rates.

[09:05:01]

WANG: It is also important to note that we are getting closer and closer to the hundredth anniversary of the founding of the Chinese Communist

Party, and before we reach that point, it is expected that the party is going to do everything in its power to prevent any downturn in growth in

the economy or in the stock markets -- Alison.

KOSIK: Okay, CNN's Selina Wang, thanks so much.

Morgan Stanley is the latest U.S. financial giant to report strong first- quarter results. The company also tallying up the damage from the collapse of Archegos Capital, the investment fund that went bust last month.

Paul La Monica joins me live now. Paul, great to see you. So, we look at the week of earnings so far. The banks have beat expectations, some blowing

away expectations like Goldman Sachs. Morgan Stanley was up to bat today. What more can you tell us?

PAUL LA MONICA, CNN BUSINESS REPORTER: Yes, as you pointed out, Alison, Morgan Stanley did take a hit. They didn't specifically name Archegos, but

we all know that this is the fund that collapsed, that hit their earnings a little bit, and they tallied about $911 million in costs tied to that

issue.

But Morgan Stanley, despite that, reported great results that blew away forecasts, it is benefitting from the IPO in the SPAC room, on the

underwriting side, their wealth management business is booming. Remember, they also recently bought Eaton Vance as well to complement that side of

the business, as well as Etrade, of course.

So these are great numbers, and at last check, Morgan Stanley's stock up a bit premarket. Several other banks also reporting great numbers this

morning -- State Street, PNC, Bank of New York Mellon. This is a good week for the big banks, as you pointed out. Goldman Sachs, JPMorgan Chase, Citi

also very solid results.

KOSIK: All right. So walk me through what's expected for the quarter. Is this latest earnings season expected to be a blowout earning season for S&P

500 companies?

LA MONICA: Exactly. For the most part, you're going to see profits rebound sharply from the depths of last year. Obviously, it was the first quarter

of 2020 when COVID-19 really became a reality, both from an economic standpoint, as well as the human toll here in America.

But corporate profits are rebounding sharply from what we had as the lows about a year ago. So you're going to see S&P 500 profits probably rise at

least 20 percent and this is the beginning of what's going to be a trend this year where analysts are forecasting very sharp economic and corporate

profit growth for the rest of the year. How much that --

KOSIK: Is the thinking --

LA MONICA: I'm sorry.

KOSIK: I am sorry to interrupt, but I've got to know, you know, is it expected that these companies are going to be able to keep up this kind of

momentum? We look at record highs for the stock market right now. The question is, what more good news is out there?

LA MONICA: Exactly. That's a fantastic point, Alison. That is what I was pretty much about to say, it was that the big question right now is how

much of this good news is already baked into the market? And how much better do things have to get?

Yes, we know that probably, there is going to be a big infrastructure bill, which could boost the economy, but there are questions about how large will

it be because President Biden has to negotiate with conservative more budget-minded, budget-hawkish Democrats, moderate Democrats as well as

obviously the opposition party. And then there are questions as well about whether or not companies will really be able to sustain this momentum.

Could things start to fall off a bit if bond yields pick up, inflation fears come back and the Federal Reserve may be forced to pull the punch

bowl away and start raising rates more aggressively, which could slow the economy.

KOSIK: All super valid points. Paul La Monica, great to see you. Thanks for all that great information.

The Russian ruble fully rebounding after dropping more than two percent yesterday over fresh U.S. sanctions against Moscow. The Biden

administration prohibiting U.S. financial institutions from buying new issues of Russian bonds after June 14th.

Clare Sebastian joins us live with the details. Great to see you, Clare. So, looking at the market reaction, it looks like it was short-lived. Do

you think that there is a sense that this could have been worse?

CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, that's absolutely what's going on.

KOSIK: It looks like we're having a technical difficulty with Clare, if we can get her back, we will go to her.

Moving on, these are the stories making headlines around the world. A gunman in the State of Indiana has killed eight people and wounded several

others in a late-night mass shooting.

Police say, he opened fire at a FedEx facility near an airport before taking his own life. At least five people have been hospitalized, one of

them is in critical condition.

Here's how one witness described the chaotic scene.

[09:10:06]

(BEGIN VIDEO CLIP)

TIMOTHY BOILLAT, EMPLOYEE AT FEDEX FACILITY: We heard two loud metal clangs at first because they didn't sound like gunshots at first. Then we

heard three more shots, and then my buddy, Levi saw someone running out of the building, and then more shots went off.

Somebody went behind their car to the trunk and got another gun, and then I saw one body on the floor.

(END VIDEO CLIP)

KOSIK: We get more now from CNN's Jason Carroll.

(BEGIN VIDEOTAPE)

JASON CARROLL, CNN U.S. NATIONAL CORRESPONDENT: Well, the F.B.I. has joined the investigation lending their efforts. We have spoken to a source

within the Indianapolis Metropolitan Police Department. He described a horrific scene inside the FedEx facility behind me.

Apparently, the suspect entered through the parking lot, immediately started shooting. Once he was inside, apparently he didn't get very far, he

continued to shoot.

The calls came into the Metropolitan Police Department at about 11:00 p.m. last night. Once police arrived, they describe what they called an active

shooting situation. They said the suspect took his own life almost immediately.

One of the eyewitnesses here, a FedEx employee says that he heard the gunfire, saw the suspect, and knew that he needed to act quickly.

UNIDENTIFIED MALE: He was firing out in the open, and I immediately ducked down and got scared. And my friend's mother, she came in and told us to get

inside the car, and what we've been doing is currently just telling everyone who is our coworkers to not go to work today and to know that

there was an incident that just happened.

CARROLL: Police say eight people were killed, four taken to hospitals, one in critical condition. But those numbers are likely to change, simply

because there were a number of walking wounded, people who were hurt out here in the parking lot or inside and took themselves to local hospitals.

And so investigators are trying to get a handle on the number of the walking wounded who took themselves to, again, to local hospitals.

There is a family reunification center set up at a Holiday Inn Express not too far from where we are right now. And apparently, a number of FedEx

employees throughout the morning didn't have their cell phones on them and so couldn't contact loved ones.

The reason for that is because, often times, cell phones are not allowed on the floor in the FedEx facility. So you can imagine when these people were

running, trying to get away, they didn't have their phones on them, were unable to reach their loved ones, so a FedEx representative apparently is

at that hotel trying to facilitate getting those people reunified with their families.

Again, the F.B.I. has joined this investigation at this point. Investigators on the ground trying to work to try to get FedEx employees

back with their family members and trying to find out a motive for why all of this has happened.

Jason Carroll, CNN, Indianapolis, Indiana.

(END VIDEOTAPE)

KOSIK: Chicago Police have released body cam video showing an officer firing a single shot that killed a 13-year-old boy more than two weeks ago.

Police say Adam Toledo was holding a gun when it happened. The family's attorney said he was not.

The shooting has sparked protests, and Chicago's Mayor is calling for calm.

A Hong Kong Court has sentenced the media tycoon and pro-democracy activist, Jimmy Lai to 14 months in prison. Lai and other campaigners were

convicted for their roles in orchestrating street protests in 2019.

The activists were charged under Hong Kong's National Security Law introduced following the protests.

President Joe Biden will soon hold his first face-to-face talks with a foreign leader at the White House. He is meeting today with Japanese Prime

Minister, Yoshihide Suga. A U.S. Official says, they are expected to focus on China and its aggressive conduct toward Taiwan.

Still to come on FIRST MOVE, Greece reopens to tourists. The holiday hot spot drops quarantine requirements for some travelers.

And driverless Dominos? We meet the startup traveling the first self- driving pizza delivery service.

(COMMERCIAL BREAK)

[09:17:19]

KOSIK: Let's return to our story on the Biden administration prohibiting U.S. financial institutions from buying new issues of Russian bonds after

June 14th. Clare Sebastian joins us again with the details. Hopefully we won't have any technical issues.

I want to ask the question because we are seeing the Russian ruble rebound. It looks like the market reaction was short-lived, so is there a sense that

this could have been worse?

SEBASTIAN: Yes, Alison, a little bit of a sigh of relief, I think in Moscow because they really were expecting this and this was very much at

the lower end of what they were expecting. One economist over in Russia described this to me as the sort of light version of the sanction.

What it does is it only hits what's called the primary market for ruble- denominated Russian bonds. That means that U.S. financial institutions can't participate in essentially the Treasury auctions of those bonds in

Russia.

Once the bonds hit the secondary market, where they are being bought and sold by all kinds of different people, they can do whatever they want.

So there is expected to be a pretty limited impact. It's clear that U.S. banks played a very small role in these primary auctions anyway. The local

banks have the power to sort of mop up any slack there. They have already said that.

But the key here is one line in the White House fact sheet about this, where it says this directive provides the authority for the U.S. government

to expand sovereign debt sanctions on Russia as appropriate.

The directive that came out yesterday provides the legal authority for the Russian government to go further, and we are watching to see what that

could spark in terms of reaction, could foreign institutions both U.S. and those based in allied countries, could they start to trim back their

holdings of Russian debt even further in anticipation of further sanctions? So that is definitely one to watch there.

KOSIK: What kind of impact could the sanctions have on the broader Russian economy?

SEBASTIAN: So, so far the macro impact is expected to be fairly limited. But we do believe that we're going to see, according to Russian economists,

is that this will keep the ruble weak that could push inflation higher and it most likely will mean that the Central Bank starts to hike rates a

little bit faster.

So that could hit the economy, but, again, we're looking for any kind of escalation here. Russian financial analysts, economists are really watching

to see what Russia does next, what happens in terms of escalation in Ukraine, what that could spark in terms of further sanctions from the U.S.

Don't forget, Russia, just like the rest of the word is in a fairly vulnerable position right now. Their economy shrank more than three percent

last year during the pandemic and because of the oil price war that we saw.

They did beef up their borrowing by about 40 percent last year, perhaps to cushion against not only the pandemic, but future sanctions. So this is a

difficult time for that economy, but overall, this particular round of sanctions, they do expect the impact to be fairly muted.

[09:20:00]

KOSIK: Okay, Clare Sebastian, thanks very much.

Let's take another look at the markets. The U.S. stock rally shows no sign of slowing down. The Dow and S&P are set to rise into further into record

territory this session amid fresh signs of U.S. economic strength. New numbers show housing starts spiking 19 percent last month. This follows

strong retail sales numbers and encouraging job data that was released yesterday.

Optimism in energy markets, too. Brent crude is on the rise for the fifth straight session and heading for a weekly gain of seven percent.

Sign of caution in the bond market, however. Yields which tend to rise on signs of economic strength have pulled back this week. This suggests that

some investors don't yet buy the long-term growth scenario.

Joining me is John Petrides, he is Portfolio Manager of Tocqueville Asset Management and he joins me live. Great to see you, John.

JOHN PETRIDES, PORTFOLIO MANAGER, TOCQUEVILLE ASSET MANAGEMENT: Yes, thanks for having me on.

KOSIK: Can you walk us through this movement in the bond market? We see the 10-year Treasury falling on Thursday. Usually when there is good news,

you would expect to go in the other direction. What are investors seeing that maybe I'm not seeing?

PETRIDES: Yes. Well, I think path of least resistance is that interest rates over the long term are going to go up. There has been massive

stimulus pumped in the economy from Central Banks and from governments. The global economy is reopening. We're all doing more with less, which is good

for our profit margins, particularly for companies.

So, I do think that interest rates will go higher. But, you know, I think in the short term, maybe they were a bit oversold. The inflation data, the

core CPI number, which excludes gas and food, last week came out 1.6 percent.

The Fed said they are looking for an average of two percent, so they're okay for inflation to overheat or at least go over their target for some

time.

So I think the fact that inflation has moved up, and maybe there is some baked that inflation will spike. But I don't think investors are expecting

it to spiral out of control, and those that may have thought inflation would spiral out of control maybe are rescinding that trade slightly in the

short term, and that's why you're seeing Treasuries catch a bit.

Let's not forget, too, that there's no yield to be had around the world. So if you're a German investor and the German bund has a negative yield right

now, you know, 1.6 percent on the U.S. Treasury looks quite attractive.

KOSIK: So there's an expectation that there will be inflation, that interest rates will rise, and then we've got the Fed admitting that they

are going to stay behind the curve. So what's the risk here in the Fed keeping rates too low for too long? And what's really considered too long?

PETRIDES: Well, there's two risks here. One is that the Fed really loses control of the inflation situation. The underlying economy is bubbling

significantly faster than expected, and when the Fed does decide to reduce its quantitative easing measures, whether it is asset programs or raising

interest rates, they are going to have to do harder and faster than the market is expecting. That's risk number one.

The second risk is that because risk appetites are on right now, we are definitely in a risk-on environment where investors are not as scared or

nearly as scared as they were this time last year, and the fact that liquidity is sloshing through the system, and the fact that the cost of our

money, i.e., interest rates are very cheap, investors' risk attitude is very high, and that could lead to asset bubbles throughout the markets,

which, when the Fed does -- when interest rates do rise and the Fed does take the punch bowl away, those asset bubbles could blow up.

So that is clearly a risk. I mean, you saw -- you see little rumblings of it with the Archegos hedge fund that blew up a couple of weeks ago.

Although, there was an issue with GameStop and Reddit, you saw the one hedge fund blow up back in January. So, you know, that clearly is a risk,

it is that -- the unforeseen, unintended consequences of cheap money is that asset bubbles start popping up in and around the global economy.

KOSIK: And even with the risks that you mentioned, you haven't mentioned the risk of the virus, and you haven't mentioned the risk of higher taxes

on companies.

So, we're seeing the markets, S&P 500 and the Dow reach fresh record highs. Is there too much complacency in the market? And you talk about impending

asset bubbles. Are we in a bubble now?

PETRIDES: Yes, you highlighted two great points. The first one is hope in regards to the virus. Hope that we will get more of the world vaccinated,

and that hope that we will push cases down and that we're doing this in a fast enough period that there aren't variants of the virus that are going

to spread that causes the whole thing to prolong longer than we all want this to be, right?

[09:25:14]

PETRIDES: So that's the hope that I'm baking in that we will get vaccinated fast enough to start cutting the cases down sooner rather than

later.

And the second point of your risk I think is exactly right. I do think the market is being complacent with a Biden tax hike and Biden has been very

specific about raising the corporate tax rate from 21 percent to 28 percent. There are some rumblings that it may be at 25 percent, but the

market really is looking through that and you know that could be a risk for investors, maybe not in 2021, but in 2022.

KOSIK: So how should investors play this market right now? Is it in cyclicals and value?

PETRIDES: I think you want to be diversified. I think what we've seen over the past five or six months where value has outperformed growth, which

hasn't happened in a very, very long time. I mean, in 2020, the main performance return for equity investors was in tech stocks, and really the

largest five companies in the S&P 500, which were predominantly tech- oriented.

So for the first time in a long time, investors are actually being compensated for being diversified and diversification as we all know is

Rule 101, you know, you don't want to put all of your eggs in one basket.

So we still think that's the place to be. Be spread out amongst different sectors within the portfolio, and for our team specifically, within our

enhanced income strategy, we're really favoring higher dividend-producing stocks.

We do think that investors are not getting compensated in the bond market for the risk they are taking on to try to find income. So, you have to find

income for your portfolio in other ways and we think higher dividend-paying stocks are really the place to be in what's still a low-yielding

environment.

KOSIK: Okay. Great talking with you. Great conversation, John. John Petrides, Portfolio Manager of Tocqueville Asset Management, thanks for

your time today.

PETRIDES: Thanks again for having me on.

KOSIK: And we'll be back after the break.

(COMMERCIAL BREAK)

[09:30:21]

KOSIK: Welcome back to FIRST MOVE. I'm Alison Kosik.

U.S. stocks are up and running on this last trading day of the week. A profitable week for stocks so far. The Dow and the S&P are in record

territory once again in early trading. Morgan Stanley shares moving higher after posting more than 60 percent rise in first quarter revenues. Results

were driven by strength in trading and investment banking even as the company takes a more than $900 million hit connected to the collapse of

Archegos Capital.

Taking a look at cryptocurrencies now. Bitcoin is pulling back from record highs. News that Turkey is set to ban payments using cryptocurrency is

helping drive the declines in Bitcoin. Turkey is one of the countries that have embraced crypto as a hedge against high inflation.

Another crypto name, Dogecoin. Some call it doggy-coin, has spiked someday 100 percent so far this Friday to an all-time high, perhaps driven by the

latest cryptic, Elon Musk tweet mentioning the speculative asset.

Now, to Brazil where researchers are warning of an unimaginable loss of life unless the government changes course in the fight against COVID-19.

CNN's Shasta Darlington reports.

(BEGIN VIDEOTAPE)

SHASTA DARLINGTON, CNN INTERNATIONAL CORRESPONDENT (voice over): For the sixth straight month in Rio de Janeiro, more people are dying than are

being born as hospitals burst at the seams.

In at least 10 other Brazilian cities, the trend is the same, as a crisis plays out across the nation. A surge in coronavirus seems to be spiraling

out of control, killing three people each minute in a record high last week.

Overwhelmed cemeteries resorting to late-night burials, just to keep up with demand. Still, experts warn the pandemic may only get worse.

A COVID P-1 variant, first discovered in Brazil, may be dangerously mutating, scientists say, becoming more resistant to vaccines as it

spreads, unchecked, across the country. If Brazil doesn't contain the variant, it could lead to an "unimaginable loss of lives," writes a team of

experts in a report published Wednesday, in the journal "Science."

"The Federal response has been a dangerous combination of inaction and wrongdoing," they add, pointing to the government of President Jair

Bolsonaro for its handling of the pandemic, as criticism mounts, worldwide.

CHRISTOS CHRISTOU, INTERNATIONAL PRESIDENT, DOCTORS WITHOUT BORDER: I have to be very clear in this. The Brazilian authorities' negligence is costing

lives.

DARLINGTON (voice over): Members of the medical NGO, Medicine Sans Frontiers say Brazil's COVID-19 response has plunged the country into a

humanitarian crisis that they warn is only likely to intensify.

But Brazil's far-right leader is bristling at international alarm, as he doubles down on opposing lockdown measures.

JAIR BOLSONARO, BRAZILIAN PRESIDENT (through translator): I think I'm the only world leader taking all this criticism. It would be easier to just

follow the masses. That way, people don't accuse you of genocide, just because I think differently.

DARLINGTON (voice over): Bolsonaro has also lambasted a probe by the country's Senate into his handling of COVID-19 and continues deflecting

criticism for a sputtering vaccine rollout.

So far, only about three percent of the population is fully vaccinated after political infighting and repeated delays.

Meanwhile, medical systems across the country begin to collapse as worrying trends emerge.

JEAN GORINCHTEYN, SAO PAULO HEALTH SECRETARY (through translator): In the first wave, we saw mainly older people, but this is not what we're seeing

now. It is a disease that has shown itself to be more aggressive, particularly in young people.

DARLINGTON (voice over): A recent report out of Brazil says most ICU patients are 40 years old and younger, for the first time since the

country's outbreak began.

No one is safe, it seems, from the grip of a deadly pandemic, as Brazil's grueling battle with coronavirus rages on.

Shasta Darlington, CNN, Sao Paulo.

(END VIDEOTAPE)

KOSIK: And Stefano Pozzebon joins me live now. Stefano, why should the world be taking notice of what's happening in Brazil right now?

STEFANO POZZEBON, JOURNALIST: Yes, Alison. Brazil is an incredible moment -- is going through an incredible moment right now and what we're seeing is

that Brazil could become an example of what happens if social distancing measures and other measures to try to control the spread of the virus are

not taken seriously.

There are already two variants that have originated in Brazil and health experts are worried that many more could originate in the future. And of

course, we know that every variant poses a new challenge towards just health administrators but also towards the vaccine providers.

[09:35:10]

POZZEBON: At the same time, the Brazil situation is also wreaking havoc in the Board room and in the economic sphere. Brazil by itself is by far the

largest economy in South America. And of course, many nations around Brazil, we're talking about Colombia, we're talking about Bolivia, we're

talking about Uruguay in particular are trying to distance themselves from Brazil by shutting the borders and limiting as much contact as possible

with Brazil. But that comes at a huge economic cost.

We have seen China posting a record growth in the first quarter of this year with 18 percent, nobody in Latin America will grow that fast this year

-- Alison.

KOSIK: Okay, Stefano Pozzebon, thanks so much.

India's coronavirus crisis also spiraling out of control. It now has more cases than Brazil, although not as many deaths. Vedika Sud reports.

(BEGIN VIDEOTAPE)

VEDIKA SUD, CNN REPORTER: India has reported over 200,000 new daily cases of COVID-19 for the second consecutive day. India's Health Minister

reported over 217,000 cases Friday, and nearly 1,200 deaths, the highest this year.

The northern state of Uttarakhand, which is hosting one of the world's largest religious festivals, the Kumbh Mela has imposed a night curfew and

restricted social and political gatherings. Surprisingly, the festival which is taking place in the City of Haridwar is exempt from the latest

restrictions.

There have been almost 4,400 cases of COVID-19 reported from the district since the festival commenced on April 1. At least four million people have

taken a dip in the Holy Water since Monday.

Despite the surging cases, election rallies in four states in the Union territory continue. Seven states including India's richest state,

Maharashtra have imposed strict restrictions. Now, starting Saturday, the Union territory of Delhi, which saw its highest single-day rise, Wednesday

has introduced weekend curfews to expand availability of beds in India's financial capital of Mumbai and Delhi are turning some hotels into

makeshift hospitals.

India has the second highest confirmed cases of COVID-19 after the U.S. according to data from the Johns Hopkins University.

Now, some countries in Southeast Asia also seeing a rise in COVID-19 cases, prompting new lockdown measures and extended travel restrictions ahead of

the Eid religious festival celebrated by Muslims.

The Philippines has reported almost 11,500 new cases, Thursday. The surge in cases began in late February. The government has reintroduced

restrictions in Manila and bordering areas.

Malaysia reported close to 2,150 new cases Thursday. The country's highest single-day rise since early March. An extended ban on interstate travel

could be imposed through Eid.

Vedika Sud, CNN, New Delhi.

(END VIDEOTAPE)

KOSIK: COVID-19 has now killed more than one million people in Europe. The World Health Organization says the milestone was passed last week. It warns

the situation on the continent is still serious, with 160 new infections reported every minute.

And some breaking news just in, German Chancellor, Angela Merkel has been given her first shot of the AstraZeneca vaccine. Our Melissa Bell joins me

live from Paris -- Melissa.

MELISSA BELL, CNN CORRESPONDENT: Well, it was that very AstraZeneca vaccine you've seen Angela Merkel there, you have heard Angela Merkel

receiving -- that was received also by the French Prime Minister just a few weeks ago, a real effort there to try and restore confidence in a vaccine

that's been so badly dented in terms of reputation because of the changing and often conflicting advice.

Now, in countries like France and Germany, it can only be given to older populations. The pause now in many European countries of the Johnson &

Johnson vaccine means that all eyes very much on the Pfizer one.

We've heard today from the man who is the head of the E.U. vaccine taskforce say that he believes that thanks to the extra 50 million doses of

the Pfizer vaccine that the E.U. is going to be receiving in the second quarter that the European Commission can live up to its promise of getting

two doses to 70 percent of the population by the middle of July. The rest he said was now down to member states and their ability to get those

vaccines into arms.

KOSIK: Melissa, now that Greece is dropping quarantine restrictions for tourists traveling from certain countries who are either vaccinated or test

negative, this beginning next week. What is the sort of thinking behind this?

BELL: Well, this is the kind of measure that you're going to see more and more. Of course, countries like Greece, we've heard also from Austria,

these last few weeks, countries that are so heavily dependent on tourism and have taken a real blow in terms of an industry that's essentially been

at a standstill now for much of the last year.

So, they have really been pushing for things like vaccine passports these last few weeks in order to be able to get their much-battered economies

really up and running again.

So, travelers from certain countries including the U.S. and the European Union now heading to Greece won't have to quarantine. They will of course

be subjected to the same restrictions as Greeks once they get to the country, but much easier now to get in and out, this ahead of the crucial

tourism season that begins in mid-May -- Alison.

[09:40:10]

KOSIK: Okay, Melissa Bell live for us from Paris, thank you.

After the break, deliveries of pizza without a pilot. The self-driving delivery company bringing fast food to your door without the need for a

tip.

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KOSIK: Welcome back. I'm Alison Kosik.

All right, and right there, you are looking at the future of pizza delivery. This is happening in Houston, Texas, where Domino's customers can

choose to have their pies delivered by a self-driving vehicle. The robot is called R2, and it's made by a company called Nuro.

The company claims this is the first completely autonomous on-road vehicle approved for use by the U.S. government.

Dave Ferguson is cofounder and President of Nuro, and he joins me live. Great to meet you.

DAVE FERGUSON, COFOUNDER AND PRESIDENT, NURO: Nice to meet you, too.

KOSIK: So talk to me about what demand has been like for Nuro and your technology both over the past year when the pandemic started and now as

consumer behavior has begun to shift to, you know, a more willingness to venture out of their home?

FERGUSON: I think similar to others that have been operating delivery services during the pandemic, we have seen an incredible surge. We've been

working with a number of partners over the last couple of years and we've seen sort of 3x I would say volume increase in the services that we've been

offering during the pandemic.

I think what's really interesting for us is that we're seeing this as very much the new normal. So we haven't seen a drop yet, and we do believe that

even once the pandemic is over and hopefully soon, and we're all back to normal, that the increased value and convenience that people are getting

from delivery is going to continue and we're going to continue to have that very elevated volume.

KOSIK: But there could be a tradeoff here because this technology replaces humans -- human drivers. So, what about the implications for job losses

among delivery drivers?

[09:45:10]

FERGUSON: One of the reasons why we at Nuro are so excited about this application of local delivery is that we're very, very confident this is

going to be a net provider of jobs in the millions in the U.S., at least. And the reason for that is that it's a very, very small market today

relative to the size of the potential market.

So, in the U.S., almost half of all of the personal vehicle trips that we take are for shopping or running errands. That's almost a hundred billion

trips a year, and if we could replace those with a service that could bring you those things and run those errands for you, then we see that as

providing a tremendous value and tremendous service to everyone. That's going to require a lot of people to help build the service side.

KOSIK: And certainly, the pandemic has put a bright spotlight on contactless delivery. So, what have been the challenges for your company

and your technology?

FERGUSON: One of the things that has always been a feature of the fully autonomous delivery is that because there is no one involved, there's no

person on the vehicle, there's no one there to transfer the goods to you, it is by definition, contactless, both from the point of being loaded, the

transport to your home, and then also you getting the goods from the vehicle.

Now, it used to be that that was just a nice-to-have. Now, with the pandemic, that's become an incredibly valuable additional aspect of the

service, and people are really appreciating that from all of the consumers that we've interacted with.

KOSIK: What about the challenge of infrastructure? How do you introduce your technology to dense urban areas like Manhattan where there are fewer,

you know, there are fewer places for the vehicle to sit? Traffic is crazy, how do you account for that?

FERGUSON: Yes. So there are probably two challenges. One is just driving and operating in dense, urban areas and then that's what we've been working

on for almost five years now on the self-driving technology side and being able to understand everything that's going on and to be able to drive very,

very safely and to be a very good member of the community as a driver. That's one aspect.

The second aspect that you mentioned is what about the delivery part itself? So when you're pulling over to deliver the goods, obviously

Manhattan is a very, very challenging place in terms of having curb space and being able to find a spot to pull over and deliver.

But the vast, vast majority of the U.S. lives in residential areas. So, suburban areas where it is much easier to do that transfer and to do that

handoff. So that's where we're starting first.

Also urban areas other than Manhattan. Manhattan is very unique-based, but we've seen in both urban and suburban areas a real delight on the customer

side to be interacting with the vehicle.

KOSIK: Okay, what if someone wants to steal the pizza and get into the R2, who isn't supposed to get the pizza?

FERGUSON: Yes. So the R2 has two compartments and each one of them is secure. And so, if we are delivering the pizza to you at the point of

pickup, you will enter a code, and you can do it either on your phone, you can do it on the vehicle itself, and then just your compartment will open.

So it is relatively secure. The R2 vehicle, is I would say, is similar security to a normal vehicle that's locked on the roads. And so while we do

expect that when these vehicles are introduced, there is going to be a novelty factor that's probably going to cause a lot of people to be excited

about interacting with them, whether they are the customer or not.

Over time, we do see it as having a pretty strong security level and we are pretty confident we can get you your pizza without anyone else messing with

it.

KOSIK: Well, thank goodness for that. And I can't wait to see one of these little robots running along the road where I live. Dave Ferguson, great to

talk with you today.

FERGUSON: Thank you.

KOSIK: Dave Ferguson, cofounder and President of Nuro.

Coming up after the break, preparations for the final journey of Prince Philip, the Duke of Edinburgh, ahead of tomorrow's funeral. We are live in

Windsor next.

(COMMERCIAL BREAK)

[09:51:23]

KOSIK: Buckingham Palace has released details about funeral arrangements for Britain's Prince Philip.

Prince Charles, William, and Harry are among the family members who will follow the coffin in a procession in Windsor on Saturday. You're watching

pictures from a rehearsal that was held on Thursday. The Archbishop of Canterbury, Justin Welby pay tribute to the Queen's courage and strength.

(BEGIN VIDEO CLIP)

JUSTIN WELBY, ARCHBISHOP OF CANTERBURY: She is the queen. She will behave with the extraordinary dignity and extraordinary courage that she always

does. And, at the same time, she is saying farewell to someone to who she was married for 73 years. I think that must be a very, very profound thing

in anybody's life.

(END VIDEO CLIP)

KOSIK: And Max Foster joins me live from Windsor. Max, good to see you. Talk us through what's going to be happening on Saturday.

MAX FOSTER, CNN ROYAL CORRESPONDENT: Well, the Archbishop will be there. He won't be presiding over the service, albeit, the Dean of Windsor, but

the Archbishop will be there and I think he is right, this is very much about the Queen, isn't it, saying goodbye to her husband, not just her

husband, but also her closest professional adviser, someone who was closer to this triumphant monarchy, really, than anyone else.

Many historians saying that this reign -- Elizabeth's reign, is one of the greatest reigns in British history, and he did play a key part in that.

They are both deeply religious as well. Philip was, the Queen is, so I think religion will very much play into the events tomorrow.

We have got a better sense of what it will look like. There will be a short procession from the top of the Castle grounds down to the chapel. We'll see

senior family members there, also some junior family members as well.

A lot being made of the fact that William and Harry will be separated by Peter Phillips, who is Princess Anne's son. Some people saying that was

always the plan. I don't think it was. I think, frankly, there is tension there still between the brothers. They just want to take attention away

from that.

The other thing you'll see tomorrow is people wearing suits, civilian suits. And I think that surprised a lot of people, because Prince Philip

was the ultimate military man. Again, I think that that was also to dissipate tensions, not to embarrass Prince Harry who has had his military

title stripped from him. He doesn't have the right to wear those uniforms anymore.

So, somewhat being done behind the scenes, but I think ultimately when it comes to the day, it will be about the Queen and remembering Prince

Philip's long and rich life.

KOSIK: Is there concern that there is going to be a bright spotlight on Prince Harry, for obvious reasons?

FOSTER: I think, you know, there are lots of questions when we're discussing things with the Palace. Harry does come up quite often. You

can't deny that there's a major family rift going on here.

I think what they're trying to do, though, is make this about Prince Philip, because this is a funeral, which is why they made these changes

behind the scenes to try to take attention away from it.

If you don't have the two brothers next to each other, you're not going to see the tension. So I think we'll get the seating plan on Saturday morning,

so that will give us a sense of how people are spread out.

But they are all going to be very spread out because it has to be all within the current restrictions. They will be two meters apart if they're

not in a bubble together.

So the Cambridges might be together, but you're not going to see Harry and William close to each other and people will read things into that.

[09:55:12]

FOSTER: I think a lot of the focus will frankly still be on the Queen, though. This is going to be the first time we've seen her as a widow

without her right-hand man there, and I think that's going to be a very poignant moment seeing her sitting effectively on her own on a bench.

KOSIK: Yes. She will, yes, be alone on a bench. Max Foster, thanks so much.

And CNN will bring you Prince Philip's funeral live on Saturday. Our coverage begins at 8:00 a.m. Eastern time. That's 1:00 p.m. in London.

Christiane Amanpour and Anderson Cooper will take you through the Royal Family gathering in St. George's Chapel at Windsor Castle to pay tribute to

the Duke of Edinburgh.

That's it for the show. I'm Alison Kosik. Stay safe out there. Have a great weekend.

"Connect the World" with Becky Anderson is next.

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