Advertisement
UK markets closed
  • NIKKEI 225

    40,168.07
    -594.66 (-1.46%)
     
  • HANG SENG

    16,541.42
    +148.58 (+0.91%)
     
  • CRUDE OIL

    83.11
    -0.06 (-0.07%)
     
  • GOLD FUTURES

    2,254.80
    +16.40 (+0.73%)
     
  • DOW

    39,807.37
    +47.29 (+0.12%)
     
  • Bitcoin GBP

    56,110.87
    +1,153.49 (+2.10%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • NASDAQ Composite

    16,379.46
    -20.06 (-0.12%)
     
  • UK FTSE All Share

    4,338.05
    +12.12 (+0.28%)
     

Stocks fall as US Covid-19 cases overtake China

Traders work at the Necton brokerage company in Sao Paulo, Brazil on March 13, 2020. - Brazilian stocks rebounded Friday after days of carnage caused by the coronavirus pandemic, following European markets higher to partially recover their losses. The Sao Paulo stock exchange's Ibovespa index surged more than 14 percent at opening, but then settled to a gain of about seven percent, after losing 14.78 percent Thursda (Photo by NELSON ALMEIDA / AFP) / The erroneous mention[s] appearing in the metadata of this photo by NELSON ALMEIDA has been modified in AFP systems in the following manner: [Traders work at the Necton Brokerage Company] instead of [Traders work at the Sao Paulo stock exchange]. Please immediately remove the erroneous mention[s] from all your online services and delete it (them) from your servers. If you have been authorized by AFP to distribute it (them) to third parties, please ensure that the same actions are carried out by them. Failure to promptly comply with these instructions will entail liability on your part for any continued or post notification usage. Therefore we thank you very much for all your attention and prompt action. We are sorry for the inconvenience this notification may cause and remain at your disposal for any further information you may require. (Photo by NELSON ALMEIDA/AFP via Getty Images)
Traders work at a brokerage company. (Nelson Almeida/AFP via Getty Images)

The FTSE 100 closed sharply lower on Friday, but still ended the week higher than it stood seven days ago.

The leading share index (^FTSE) closed down 5.2% at 5,510.33 in London on Friday. The sell-off followed three days of gains for stocks globally and the FTSE 100 was still 6.8% higher than it stood at the end of last week.

Similar sell-offs were seen around the world. The DAX (^GDAXI) in Germany closed down 3.6% and the CAC 40 (^FCHI) in France ended the session 4.2% lower.

In the US, the S&P 500 (^GSPC) was trading down 2.7% by the time European markets closed. The Dow Jones Industrial Average (^DJI) fell 3% and the Nasdaq (^IXIC) was down by 2.9%.

ADVERTISEMENT

“Investors are still showing nerves of holding positions over the weekend,” said Nigel Firth, a senior market analyst at AskTraders.

Michael Hewson, chief market analyst at trading platform CMC Markets, said negative sentiment was being driven by the fact the number of Covid-19 cases in the US had overtaken China’s total.

Confirmed Covid-19 cases in the US have risen to 85,991, according to John Hopkins University, surpassing China’s total of 81,782. Globally, infections have climbed past 530,000 and deaths have risen over 24,000.

“Against this sort of backdrop it is still way too early to sound the all clear, and while yesterday’s rebound was welcome it takes no account of the fact that the infection count and death rate is likely to continue to rise sharply in the coming weeks, and that in any subsequent recovery, consumer incomes and confidence will take some time to recover,” Hewson said.

The FTSE 100 sell-off was particularly sharp and partly driven by a rally for the pound. More than half of FTSE 100 company earnings are in dollars and so a stronger pound makes sterling-denominated shares look comparatively more expensive. Sterling was up 2.1% against the dollar to $1.2419 (GBPUSD=X) at 5pm on Friday.

Cruise operator Carnival (CCL.L) was the biggest faller on the FTSE 100, crashing 20.5%. The company is a significant dollar earner and is also suffering from slumping demand due to the Covid-19 pandemic.

Cruise businesses have been pummelled by the recent global collapse in international travel. Worse still, CNBC reported that the wording of the US’s historic $2tn stimulus bill could leave many cruise operators unable to tap state aid.

Elsewhere, retailer Next (NXT.L) fell 11% after taking the “difficult decision” to shut its online operations, which have continued while stores have been shut.

“Next has listened very carefully to its colleagues working in warehousing and distribution operations to fulfil online orders,” the company said in a statement. “It is clear that many increasingly feel they should be at home in the current climate.”

The cancellation of dividends by a string of London-listed companies also pushed markets lower. Royal Mail (RMG.L), Meggitt (MGGT.L), Domino’s Pizza (DOM.L) and Rightmove (RMV.L) all announced on Friday they were cancelling shareholder payouts.