(Alliance News) - Stock prices in London were lower at midday on Friday as global cases of Covid-19 continued to rise, while investors brace for grim jobs data from the US likely to show the start of a decline in the labor market.
More than a million cases of coronavirus have been registered globally, according to the latest figures from Johns Hopkins University
The FTSE 100 index was down 68.07 points, or 1.2%, at 5,412.05 at midday.
The mid-cap FTSE 250 index was down 265.51 points, or 1.8%, at 14,171.24. The AIM All-Share index was down 0.4% at 662.52.
The Cboe UK 100 index was down 0.9% at 9,179.68. The Cboe 250 was down 1.7% at 12,223.22, and the Cboe Small Companies down 0.% at 7,970.84.
In Paris the CAC 40 was down 1.3%, while the DAX 30 in Frankfurt was down 0.6%.
On the London Stock Exchange, Carnival was the best blue-chip performer, up 4.1%, Shares in the cruise line operator were staging a slight rebound after sinking on Thursday.
Carnival on Thursday said it had raised new equity at a higher cost than expected, as the firm covers itself against coronavirus disruption. The stock closed down 22% on Thursday.
In the FTSE 250, transport operators were in the green welcoming financial support from the UK government for the bus sector amid the collapse in demand caused by Covid-19.
Go-Ahead Group was up 13%, National Express up 3.7%, FirstGroup up 4.8%, and Stagecoach up 5.8%.
Bus companies in England will receive almost GBP170 million in new government funding to ensure services continue to operate during the coronavirus pandemic. UK Transport Secretary Grant Shapps said on Friday the investment will protect crucial local transport links across England for those unable to work from home.
FirstGroup Chief Executive said he was "pleased" with the help, while his counterpart at Go-Ahead Group David Brown said he was "very pleased". Stagecoach said the aid was "welcome".
The pound was quoted at USD1.2277 at midday, down sharply from USD1.2402 at the London equities close Thursday, as the UK services sector registered its biggest decline in survey history in March, IHS Markit reported.
The services purchasing managers' index was 34.5 in March, compared to the initial flash figure of 35.7 and the 53.2 recorded in February. The previous record low had been recorded at the height of the global financial crisis in 2008/2009, IHS Markit said, and March's performance was "by far" the worst since the survey began in July 1996.
The composite PMI slumped to 36.0 in March, compared to the flash reading of 37.1 and February's 53.0.
The euro stood at USD1.0807 at midday, down from USD1.0878 at the European equities close Thursday, following bleak PMI figures from the continent.
The eurozone's services sector was pummelled by virus-forced standstills in March. The IHS Markit services business activity index fell to a record low of 26.4 in March, below 50, meaning the sector is in decline, from 52.6 in February.
The composite purchasing managers' index - compiled using services and manufacturing data from earlier in the week - fell to 29.7, below the 31.4 flash estimate and a large slump from 51.6 in February.
In addition, Germany's composite PMI slumped to 35.0 in March from 50.7 in February, while data showed France's composite PMI crashed to a historic low of 28.9, from 52.0 in February.
Against the yen, the dollar was trading at JPY108.46, up from JPY107.77 late Thursday.
Stocks in New York are set to open lower on Friday ahead of the closely-watched jobs report for March at 1330 BST.
US jobs data is expected to decline for the first time since 2010, however, the March figures will likely mask the full extent of the damage caused to the world's largest economy as a result of the pandemic.
The DJIA was called down 1.1%, the S&P 500 index down 1.0% and the Nasdaq Composite down 1.1%.
The US economy is expected to have lost 100,000 jobs in March, while the unemployment rate is seen at 3.8%, up from 3.5% in February.
This jobs report will follow Thursday's initial jobless claims which set an eye-watering new high. For the week ended March 28, seasonally-adjusted initial claims were a whopping 6.6 million, with the previous week's level revised up by 24,000 to stand at just over 3.3 million.
"With the unemployment rate for February still at a rock bottom 3.5%, the 6.6 million rise in jobless is sure to drive up unemployment for the month. From a payrolls perspective, market estimates of -100k are shocking, yet the jobless claims figure down highlight how even the most pessimistic estimates can seem optimistic when the true effect of the virus become evident," said IG Group.
Brent oil was quoted at USD32.85 a barrel at midday, up sharply from USD30.02 at the London equities close Thursday, as OPEC and its allies agreed to hold an emergency meeting on Monday to discuss oil production cuts.
"This meeting is being held at the invitation of the kingdom of Saudi Arabia after the talks mediated by US President Donald Trump," Azerbaijan's Energy Ministry said in a statement.
The meeting will include the members of the Vienna-based Organization of Petroleum Exporting Countries and allied oil-producing states in the OPEC+ format, such as Azerbaijan and Russia, according to the statement.
A Vienna-based source confirmed that OPEC+ ministers will conduct talks on Monday, which may be joined by additional countries.
Helima Croft at RBC Capital Markets said: "We believe that the Kingdom could be prepared to drop production down to around 8.5 million barrels per day, but would probably be reluctant to go below that level initially because of the desire to maintain associated gas production. Moscow, in turn, will likely look for some measure of sanctions relief from Washington, and the Rosneft decision to exit Venezuela over the weekend could pave the way for a sanctions roll back on that all-important Russian corporate.
"In addition, [Russian President] Putin could also be seeking firm commitments from both Saudi Arabia and UAE to partner with the Russian Direct Investment Fund on future projects. RDIF head Kirill Dmitriev has been a key interlocutor between Riyadh and Moscow throughout the standoff and has been one of the strongest Russian proponents of continued cooperation with OPEC. However, even if Russia agrees to a big headline cut, compliance will likely still be a problem for the country. Russia had not fully lived up to its December cut commitments, even after securing the exemption."
Gold was quoted at USD1,611.23 at midday, flat against USD1,610.10 late Thursday.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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