Markets enjoy second day of growth as virus fears ease

Investors remained positive on Tuesday as markets continued the strong momentum from Monday, as small signs that the coronavirus pandemic is cooling slightly in the hardest-hit European countries.

The FTSE 100 leading index of shares closed the day up 122.06 points, or 2.19%, at 5704.45 – but it was a 5% jump on the FTSE 250 which peaked traders’ interest.

The FTSE 250 is primarily made up of UK-focused companies and is seen as a good indicator of the country’s economic health, compared with the international-focused larger index.

In France, the country’s Cac 40 index closed up 2.1% and Germany’s Dax 30 was up 2.8% – helped by strong moves up in the US.

Joshua Mahony, senior market analyst at IG, said: “With market focusing on the weeks ahead, traders have been striking an optimistic tone as we see a number of countries turn the tide on the coronavirus.”

Michael Hewson at CMC Markets added: “It has been another solid day of gains for European markets as optimism grows that Covid-19 infection and death rates have reached the peak of the crisis and are on their way back down across Europe.”

The pound had fallen earlier in the day, with Prime Minister Boris Johnson remaining in intensive care, although by close of markets it was up 0.89% at 1.234 dollars. Against the euro, it was flat at 1.134 euros.

In company news, Cineworld led the biggest risers on the FTSE 100, closing up 19.39p at 59p – up nearly 50% – as the company gave an update on the effects of the virus on its business.

Bosses said they would be scrapping a planned dividend payment and bonuses will be suspended, adding it would be “curtailing all currently unnecessary capital expenditure”.

EasyJet shareholders were happy, as bosses revealed they had secured a £600 million Government loan to keep functioning.

Founder Sir Stelios Haji-Ioannou warned the firm will “run out of money by around August”. Shares closed up 83.4p at 625.8p.

Elsewhere, car dealership business Inchcape has scrapped its dividend as part of measures to preserve cash after being hurt by the coronavirus outbreak.

The motor retailer said trading in a “large number” of its markets has been impacted by closures or “significantly lower business activity” as a result of the virus. Shares closed up 49.2p at 485.2p.

Meanwhile, video games developer Codemasters reported a surge in digital downloads as people spend more hours indoors due to the coronavirus lockdown.

The UK firm said earnings for the year to March 31 were “comfortably ahead of expectations” despite the Covid-19 outbreak. Shares closed up 24.5p at 272p.

And office landlord Workspace Group said only half of its customers had paid their rents by the end of March, while a large number have sought relief. But investors were happy as they were told cost cutting is underway. Shares closed up 72.5p at 752p.

The biggest risers on the FTSE 100 were Carnival up 158.8p at 874.8p; Easyjet up 83.4p at 635.8p; Rolls-Royce up 38p at 335.7p; ITV up 6.94p at 65.6p; and British Land up 34.9p at 370p.

The biggest fallers were Hikma down 149p at 2,199p; Ocado down 64.5p at 1,324.5p; AstraZeneca down 184p at 7,000p; Severn Trent down 32p at 2,175p and Relx down 24p at 1,718p.

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