Coronavirus continues to spook the markets

Brexit Day may be upon us, but traders in the City were less than cheery on another tough day for the markets.

The coronavirus outbreak continued to hit exchanges, as countries around the world confirmed their own cases – including two in the UK – although the falls were not as heavy as Thursday.

Early attempts by the FTSE 100 to rise, following decent Microsoft results coming out of the US overnight, failed to catch on, instead the index closed the week out in the red.

The leading index closed down 95.95 points, or 1.3%, at 7,286.01, with similar drops elsewhere in Europe. The German Dax lost 1.33% and French Cac dropped 1.1%.

Sterling had a better day – enjoying falls in the dollar as US exchanges on Friday dropped with traders stateside catching up with the coronavirus fears sweeping European trading floors.

As stock markets closed on Friday, a pound was worth 1.319 dollars – up 0.01 or 0.77%. A pound was worth 1.191 euros – up 0.004 or 0.31%.

David Madden, market analyst at CMC Markets, said: “Dealers are dumping stocks for fear the health crisis will curtail economic activity in China, and to a lesser extent the rest of the world – should the situation keep spreading.

“The FTSE 100 fell to a seven-week low, and it is not too far from the low of the week. It would appear that traders are rushing for the exit before markets in mainland China re-open on Monday – the authorities might decide to extend their holiday period though.”

But it was not just health problems knocking the markets. Data from the Eurozone on Friday showed GDP fell to just 0.1% in the final quarter of 2019 – down from just 0.2% in the third quarter.

Connor Campbell, financial analyst at SpreadEx, said: “Combine that with contraction in specific countries like France and Italy, and the coronavirus wasn’t the only thing investors had to fear.

“The concern for investors is that the coronavirus isn’t going to go away overnight. And while they’ve tried their hardest at points to ignore the headlines – just look at the multiple attempts at quickly-aborted rebounds – the outbreak, combined with a bad round of data, leaves them in a difficult position heading into February.”

In company news, Aston Martin enjoyed a 24% boost in its shares, up 96.1p to 498.8p as bosses revealed Canadian billionaire has agreed to buy a 16.7% stake in the business, following a rights issue.

However, shares are still a long way off their 1,900p listing price in 2018.

Investment platform Hargreaves Lansdown revealed it waived fees of £2.3 million over the Neil Woodford fund suspension, and also saw new business growth slow. Investors were unimpressed and shares fell 154.5p at 1,725p.

Shareholders in drinks maker Britvic were impressed with first quarter sales up 4.9% to £369.8 million. Shares closed up 49.5p at 925.5p.

But investors in French Connection felt the pain, as the company revealed it has failed to find a buyer for the business at the price bosses were happy with. Shares plunged 28%, down 9.4p to 24.1p.

The top risers on the FTSE 100 were Polymetal, up 20p to 1,286p, Imperial Brands, up 27.8p to 1,950.8p, SSE, up 7.5p to 1,508.5p, Pearson, up 2.6p to 568.4p, and Persimmon, up 13p at 3,053p.

The main fallers on the index were Hargreaves Lansdown, down 154.5p to 1,725p, Evraz, down 15.8p to 352.6p, Antofagasta, down 32.8p to 822.2p, Ashtead Group, down 97p to 2,455p, and Ocado, down 47p to 1,223.5p.