Markets shudder as global Covid-19 fallout continues

Markets faced another nightmare day on Thursday, with London’s top index losing more than 4% of its value at one point.

The FTSE 100 closed the day down 246.07 points to 6796.4, a 3.5% drop.

Despite the enormous fall, at one point things looked like they could have been worse.

The index that reached as low as 6,731.35 around an hour before closing for the day.

But in a nightmare week for traders Thursday’s rout is only the second worst day, after Monday when the top flight lost 247.09 points.

Analysts might have hoped for a let-up after the FTSE rose slightly on Wednesday.

It means that £152 billion has been wiped off the index in the last four days amid fears around Covid-19.

It was a feat replicated across the continent as France’s Cac lose 3.3% of its value while the Frankfurt-based Dax index dropped by 3.2%.

Meanwhile, in the US the Dow Jones Industrial Average was down around 1.7% just after markets had closed in Europe.

Sterling lost 0.2% of its value against the dollar, with one pound now buying 1.2873 of the US currency.

It dropped more against the euro, by 1.02% to 1.1732.

There was plenty of company news, with a solitary few shares managing to stay in positive territory because of strong releases.

Prime among these was Hikma Pharmaceuticals, whose shares gained 4.6%, or 84.5p to 1,910p after it signed a deal to bring one of its nasal sprays to the US and showed soaring profits.

The business said that it was not being hit by the coronavirus outbreak.

Rentokil also gained, up 8.4p to 504p, after it said that that adjusted profit before tax rose 10.7% to £340.9 million in 2019 on revenue of £2.7 billion, which grew 9.8%.

At the other end of the spectrum WPP could not purely blame coronavirus for its awful showing as shares plummeted 16%, or 146.8p, to 761.6p after the advertising giant said its most-watched measure of revenue, which removes pass-through costs, fell 0.3% to £10.8 billion in 2019.

Pre-tax profit fell 22% to £982 as the company embarks on another year of turnaround.

Even worse, Topps Tiles dropped nearly 25%, or 19.6p, to 59p after warning over profits as Britons rein in their spending on DIY.

British American Tobacco fared better, down 57p to 3,162.50p as it posted lower profits after the Camel and Lucky Strike maker was hit by litigation charges and restructuring costs.

Pre-tax profit fell 5.2% to £7.91 billion in the year to December.

And the maker of Corona beer revealed a hit from the coronavirus outbreak, causing shares to drop 10.5%, or 6.5p, in AB Inbev to 55.55p.

It warned over the steepest decline in quarterly profit for at least a decade after coronavirus cost it around 170 million US dollars (£132 million) in lost profit.

The owner of Paddy Power and Betfair saw pre-tax profits tumble as it was hit by higher UK gambling taxes.

Flutter’s shares fell 600p to 8,226p.

UK housebuilder Persimmon fell by 195p to 2,883p as its chief executive David Jenkinson stepped down after just over a year in the role.

NMC Health was the only FTSE 100 company whose shares remained totally unaffected on Thursday, but that was only because they were suspended by the financial watchdog.

It comes after the troubled firm fired its chief executive, suspended a member of its treasury team and gave “extended leave” to its finance chief on Wednesday evening after finding discrepancies in its bank statements.

Insurer RSA was the final of the three companies whose shares were in positive territory as it gained 3p to 535p.

It comes after the firm said floods caused by the recent storms are likely to have an impact on its UK arm in the first quarter, but praised the success of flood defences in helping minimise damage.

The price of oil standard Brent crude fell 2.3% to 52.19 US dollars per barrel.

The biggest risers on the FTSE 100 were Hikma Pharmaceuticals, up 84.5p to 1,910p, Rentokil Initial, up 8.4p to 504p, and RSA Insurance, up 3p to 535p.

The biggest fallers on the FTSE 100 were WPP, down 146.8p to 761.6p, Evraz, down 39.6p to 337p, TUI, down 58.2p to 655.80p, IAG, down 44.2p to 515.40p, and easyJet, down 92.5p to 1,110p.