FTSE attempts fightback after coronavirus market meltdown

FTSE attempts fightback after coronavirus market meltdown
By: Business Posted On: March 17, 2020 View: 19

FTSE attempts fightback after coronavirus market meltdown

The FTSE 100's Tuesday fightback appears to have failed, as it falls again, following days of market turmoil due to increasing fears of coronavirus.

London's blue-chip index was up around 2% shortly after opening, while the domestically-focused FTSE MID250 index gained 2%.

However, shortly after 8.30, the FTSE 100 went into reverse, down more than 0.5%. By 12.15, it was down 1.35%.

One of the main victims was catering firm Compass Group, which saw its shares dive after the UK government toughened its social distancing advice to include pubs, theatres and restaurants.

Shares in the group fell by 22.2% to their lowest since June 2013, after it forecast half-yearly operating profit would be well below expectations due to the spread of the virus. At midday, they were down by 15%.

European stocks were also attempting a recovery, with the pan-European STOXX 600 index up 2.7% just after 8am UK time, having fallen to its lowest point on Monday since November 2012.

The Asian markets were mixed overnight, with Singapore and Malaysia both hitting their lowest points in around a decade but Tokyo and Hong Kong showing some positive notes.

More from Business

The Philippines closed its financial markets in response to the virus on Tuesday, the first in the world to do so, following the temporary pauses seen in some other markets, including the US.

Indonesia was down more than 4% - their lowest point in more than four years - and Thai shares fell by 0.7%, as the country's cabinet prepared to meet to approve the closure of universities, schools, bars and theatres.

It came after Wall Street saw its biggest drop since 1987's Black Monday crash, with the Federal Reserve's interest rate cut failing to soothe the markets.

ING analysts said in a note: "The main worry seems to be the central banks running out of policy space needed to combat the impact of the virus.

"And this now calls for a coordinated fiscal response by the governments."

The US S&P 500 dropped 12% on Monday as whispers of a possible coronavirus-inspired recession grew stronger.

It has shed nearly 30% since setting a record less than a month ago. The Dow fell 12.9%.

Wells Fargo Securities forecasted a recession for the US in the April-June quarter and Joel Prakken, chief US economist at IHS Markit, projects the economy will shrink at a 5.4% annualised rate during the quarter.

Northern Asia, however, showed some resilience: Japan's Nikkei 225 climbed 0.8% at one point but closed up just 0.05%, and the Hang Seng in Hong Kong was up 0.8%.

Sky News' Thomas Moore looks at what the new COVID-19 measure mean
Why did the government change its coronavirus response?

Francis Lun, a stock analyst in Hong Kong, said investors were going "bargain hunting", adding: "It's a see-saw battle between the bulls and the bears," he added. "I think right now the bulls are winning the upper hand. The key is that Hong Kong is dirt cheap."

Asia was also encouraged by news that US President Donald Trump's administration could offer support to airlines affected by the outbreak as part of a package to help businesses.

Oil prices were also up, Brent crude climbing by 1.6% to $30.53 (£24.92) per barrel on Tuesday morning.

More than 175,000 people have been infected by COVID-19 worldwide, most of them in China. As at Tuesday morning, there were more than 1,500 cases in the UK and 55 people had died.

Sky News will broadcast a special programme at 6pm, with experts answering your questions #AskSkyNews at 12.30pm

Let's block ads! (Why?)

  Contact Us

24 hours

Tel : + (888) - 8XX XXX
Mail : support@dountothem.com

  Follow Us
Featured Links

Welcome to DoUntoThem home of variety of news from all over the world.

Advertise With Us

Cookie Policy

Privacy Policy

Terms of Service