* FTSE 100 down 0.5%, FTSE 250 flat
* New coronavirus cases tick up
* Daejan outshines market on buyout offer
(Adds news items, analyst comments, updates share prices)
By Shashwat Awasthi
Feb 21 (Reuters) - London's FTSE 100 dropped on Friday as
investors took measures to reduce their exposure to perceived
risky assets as the coronavirus continued to spread, while a
buyout offer powered mid-cap real estate investment firm Daejan
to a life-high.
The FTSE 100 slipped 0.5% after an uptick in new
cases of the virus in China and South Korea hit stocks more
exposed to commodity prices including oil majors and miners
.
"Perhaps the reality of the situation is starting to hit
home for investors or maybe, and probably more likely, they're
using the slew of warnings to take some profit and risk off the
table," OANDA analyst Craig Erlam said.
The FTSE 250 erased earlier losses to trade roughly
flat by 0840 GMT, helped by Daejan Holdings which
soared as much as 55.7% to match the 8050 pence per share offer
price.
The China-linked virus, which has killed more than 2,200
people, dominated headlines again this week and triggered swings
in global markets.
Companies including the world's largest tech firm Apple
have warned of a hit to sales due to the health crisis.
That has led market participants away from equities and to pile
into safe haven assets like gold.
Still, Erlam raised the possibility of a quick rebound in
markets as dealers look to buy into assets at a cheap price.
"This is a dip buying environment so it's probably only a
matter of time until investors pile back in on the 'discount
goods'," he said.
In other moves, education group Pearson skidded 4%
to the bottom of the blue-chip bourse after its annual profit
came in slightly below its forecast.
Shares of Royal Mail dipped 1%. The postal group on
Thursday proposed a new pay deal to appease its largest union,
which has threatened to go on strike.
(Reporting by Shashwat Awasthi in Bengaluru; Editing by Bernard
Orr)
