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Latest Share Chat

UPDATE 2-Britain's FTSE 100 skids after PM Johnson gets coronavirus

Fri, 27th Mar 2020 10:31

(For a live blog on European stocks, type LIVE/ in an Eikon
news window)

* FTSE 100 down 5.3%, FTSE 250 slides 4%

* Carnival slides as cruise firms left out of U.S. package

* Provident Financial falls on dividend suspension

* Fashion chain Next shuts online business, shares slump
(Updates to market close)

By Sruthi Shankar and Devik Jain

March 27 (Reuters) - London's main share index fell sharply
on Friday as Prime Minister Boris Johnson became the first world
leader to test positive for coronavirus, which claimed more
lives in Britain.

After a three-day surge driven by government and central
bank measures to lessen the blow from the coronavirus crisis,
the blue-chip FTSE 100 fell by 5.3%.

Losses accelerated after Johnson's announcement that he is
self-isolating in London, but he would still lead the British
government's response to the pandemic.

"It's a gut reaction by markets which is not justified by
what's happened," Rupert Thompson, chief investment officer at
Kingswood said of the FTSE's fall.

The World Health Organization said the coronavirus has
infected more than half a million people and killed 20,000
globally, while Britain has recorded more than 14,500 cases and
759 deaths.

Businesses also took a hit, with fashion chain Next
slumping 11% as it shut its online business, cutting off its
remaining source of revenue.

Carnival Corp slid 21%, with traders pointing to
news that the $2 trillion U.S. aid package may exclude cruise
liners not registered in the United States.

Global stock markets had some respite this week as central
banks and governments ramped up stimulus measures. The British
government said on Thursday it would pay a taxable grant to
self-employed people affected by the pandemic.

"You've got two big forces in opposing direction in play -
you've got massive monetary and fiscal stimulus trying to offset
a massive fall in activity - which one wins out is hard to
tell," said Thompson.

Homebuilders Taylor Wimpey and Persimmon
dropped 9% and 11% respectively after the government urged
people to avoid moving house during the outbreak.

Shares in one of Britain's largest housebuilders, Redrow
, fell 8.6% after the company said it was in talks with
six banks to secure additional credit and had applied to the
Bank of England's scheme for financing support.

The midcap index fell 4%, with doorstep lender
Provident Financial sliding 13% after it stopped
face-to-face visits due to the coronavirus lockdown and withdrew
its 2020 targets.

Royal Mail fell 18% after saying it had delayed its
turnaround plans and had also cancelled its dividend and
suspended its forecasts for next year.
(Reporting by Sruthi Shankar and Devik Jain in Bengaluru;
Editing by Shounak Dasgupta, Anil D'Silva and Alexander Smith)

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