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UK stocks slide on COVID-19 concerns, FTSE 100 erases weekly gains

Published 03/07/2020, 08:32
Updated 03/07/2020, 18:52
© Reuters. FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain

© Reuters. FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain

By Shreyashi Sanyal

(Reuters) - UK stocks ended lower on Friday, with the FTSE 100 index wiping out gains for the week as a record surge in U.S. COVID-19 cases made investors question the chance of a swift global economic recovery.

The blue-chip FTSE 100 (FTSE) slid 1.3%, with BP Plc (L:BP) and Royal Dutch Shell Plc (L:RDSa) among the biggest drags, as the new infections raised the spectre of further lockdowns and hit oil prices.

The domestically-focussed FTSE 250 (FTMC) fell 0.4% on the day, but still held onto a weekly gain.

"Stocks enjoyed a big rally yesterday on the back of the optimism about a possible COVID-19 vaccine but all of the gains the FTSE 100 made yesterday have been lost today on renewed health fears," said David Madden, market analyst at CMC Markets UK.

British stocks had opened higher on Friday as data showed China's services sector expanded at its fastest pace in over a decade last month.

At home, data showed a historic slump across British businesses levelled off last month as some of the economy reopened from the coronavirus lockdown.

UK stock markets have rebounded sharply from a virus-driven crash in March, helped by historic stimulus and, more recently, data that had raised hopes that the worst of the pandemic's economic damage might be over.

But analysts have warned of another sell-off in financial markets as business sentiment remains fragile. Data on Friday showed about 46% of UK manufacturers are expecting to lay off workers over the next six months.

Retailer Next (L:NXT) fell 4.6% after Goldman Sachs (NYSE:GS) downgraded the stock to "sell", while AB Foods (L:ABF) slipped 1.8% after the U.S. bank cut its rating on the stock to "neutral".

© Reuters. A passenger walks through a terminal at Heathrow Airport, as Britain launches its 14-day quarantine for international arrivals, following the outbreak of the coronavirus disease (COVID-19), London, Britain

Land Securities (L:LAND) rose 0.5% after it said like-for-like sales at its shopping centres was at 80% of the level achieved last year in the two weeks since non-essential retail reopened in England.

Latest comments

Guys, trust me...I invested quite heavily..but gained only 40k (very small compared to the investment)...Maybe, I was wrong but stoped investing...total uncertainties ...to my mind, no sense (economical)..Just big players pumping and dumping..someone will be lucky, someone don’t
its all manipulated and investing in fiat staff its very very dangerous those days , better to buy phisical staff and wait if u have no greed pressure im my opinion
We all here knows the facts, world economy down, ressesion is here, Unemployment is high, virus infection is high, more death is otw, Gorvement keep on pumping $$, companies biz is suffering and etc...what else more and yet thlle index and companies stocks can goes higher...
European Markets so uncertain, while Chinese markets are gaining. Yes, covid cases have increased but death rate is not (fingers crossed it stays that way) and market gains confidence.
European markets seem to be caught in the headlights when the US is shut. Either that or theyre just realistic and the US greedy.
This makes absolutely no sense, its not like they got more sales, or expecting to recover the lost sales. Markets are feeding on euforia only. When the time of reckoning will come, I really want to see how they'll deal with less demand while still having to employ and repay the debt.
All the investors in UK and Europe are standing around looking at each other wondering what to do. America is shut.
LUL a lot of stocks got even bigger during corona. A rebound is the least markets expect now! Nothing short of an economic boom is priced in
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