Stock market plunges as spike in coronavirus cases outside of China sparks fears of a pandemic

Stock market plunges as spike in coronavirus cases outside of China sparks fears of a pandemic and hits global shares

  • The FTSE 100 has plunged over 3 per cent 
  • Jump in coronavirus cases outside of China spooks investors around the world 
  • Easyjet, TUI, and British Airways’ parent company IAG all experienced declines of more than 7% in first hour of trading 

The FTSE 100 has plunged over 3 per cent in the early stages of trading on Monday after a jump in coronavirus cases outside of China spooked investors around the world.

Airlines and committees companies were among the worst hit as markets took fright at the potential impact of the continuing crisis on travel. 

Three of Britain’s largest airlines had the largest fall on the FTSE 100 stock market this morning as the Covid-19 outbreak continues to spread. 

Stocks around the world plunged in trading on Monday as market fears over the virus outbreak picked up 

Markets around the world had been stable last week despite the potential hit to the global economy stemming from the outbreak over the past couple of weeks. But the outbreaks over the weekend sent traders to the sell button this morning. 

Easyjet, TUI, and British Airways’ parent company IAG all experienced declines of more than seven per cent in the first hour of trading today, as the coronavirus spreads to Europe. Easyjet had the biggest drop of any firm, falling 9.25 per cent.

Mining firms also suffered a considerable fall in their value, with Glencore, Evraz, and Anglo American slumping by at least five per cent each. 

The falls in London follow similar plunges in Asia markets overnight and will stoke expectations of similar falls in America when trading gets underway later today.  

Deep in the red: The FTSE 100 slid dramatically on Monday morning

Deep in the red: The FTSE 100 slid dramatically on Monday morning

‘Fears over an escalation of the coronavirus outside of China have caused a major retreat in global markets and prompted wild swings in commodity prices,’ said AJ Bell’s Russ Mould. 

‘Italy’s lockdown, as the country tries to control the worst outbreak of the virus in Europe, has caused investors to panic about how business and society will be affected. A large spike in coronavirus cases in South Korea has also added to market concerns.

‘The result is a large sell-off in equities with UK, Europe and Asia deeply in the red. The FTSE 100 fell 2.1% to 7,251 and the FTSE 250 index dropped 1.8%. Euro Stoxx 50 declined 2.7% and Hong Kong’s Hang Seng index fell 1.8%. Oil prices slumped 3.2% to $56.64 per barrel.

‘Only four stocks were in positive territory on the FTSE 100, being gold and silver miner Polymetal, distribution business Bunzl, media group Pearson and rat catcher Rentokil.

‘There has been so much complacency in recent weeks from investors, despite clear signs that China’s economy is facing a large hit and that supply chains around the world were being disrupted.

‘Markets initially wobbled in January but had quickly bounced back, implying that investors didn’t see the coronavirus as a serious threat to corporate earnings. They may now be reappraising the situation.’

 

 



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