FTSE 100 stumbles into the red after coronavirus rebound
The FTSE 100 slid into the red as a week characterised by a significant rebound in the wake of the coronavirus outbreak finished with a stumble.
The London top flight closed 38.09 lower at 7,466.7 at the end of trading on Friday.
Connor Campbell, financial analyst at Spreadex, said: “Though there is clearly an appetite to keep pushing the Western indices higher, at the same time the coronavirus outbreak is far from dealt with.
“In light of that the highs – in some cases all-time –the market galloped to on Thursday appear quite fragile, perhaps even naïve, hence the selling seen on Friday.”
The FTSE 100 was the worst hit of the major indices across Europe as it was also weakened by a rebound in the value of the pound.
Sterling increased against the euro as it benefited from a dire set of industrial production statistics from the Eurozone.
The value of the pound decreased 0.23% versus the US dollar at 1.289 and increased 0.08% against the euro at 1.094.
The European markets lost steam on a cautious trading day, having seen the Dax leap towards a record high on Thursday.
The German Dax decreased by 0.45% while the French Cac moved 0.14% lower.
Across the Atlantic, the Dow Jones edged lower alongside the S&P 500 as both markets shrugged off a widely positive jobs report.
David Madden, market analyst at CMC Markets UK, said: “The jobs report shows the US labour market is in rude health, and it seems that traders would secure their profits as the week draws to a close.
“It is possible the situation in China will worsen over the weekend – when markets are closed, hence that’s why dealers are ducking out of equities.”
In company news, Burberry investors remained subdued despite the company revealing it has shut 24 of its 64 stores in mainland China as fears over a growing coronavirus outbreak continue to grip the country.
The company said it was taking action to ensure that staff remained safe. But it warned investors that the outbreak was having a “material negative effect” on demand for luxury products. Shares in the company dipped just 2p to 2,015p.
Elsewhere, housebuilder Bellway said it had built a record number of new homes in the first six months of the financial year.
Bellway said that 5,321 homes were finished in the half, a 6.3% rise on the year before. Shares closed the day 32p lower at 4,032p as a result.
Tui bounced higher on Friday as the holiday firm confirmed it was set to bank 700 million euros (£593 million) after selling its cruises business to a joint venture it already owns with Royal Caribbean. Shares increased by 12.8p to 863.6p.
The price of oil slipped into the red as Russia’s reluctance to cut output acted as a green light for the sellers.
The price of a barrel of Brent crude oil fell 0.91% to 54.66 US dollars.
The biggest risers on the FTSE 100 were Smurtfit Kappa, up 92p at 2,938p, Standard Life Aberdeen, up 6p at 317.1p, Ferguson, up 126p at 7,440p, and Tui, up 12.8p at 863.6p.
The biggest fallers on the index were NMC health, down 200p at 700p, Heargreaves Lansdown, down 104p at 1,604.5p, Antofagasta, down 31.8p at 849p, and Carnival, down 96p at 3,114p.