London close: Stocks end sharply lower again as oil futures crash

London equity markets finished near their worst levels of the session on Friday, with oil and gas shares under the cosh after the Russian Federation refused to go ahead with another oil output cut alongside the Organisation of Petroleum Exporting Countries.

By the end of trading, the FTSE 100 was down 3.6% at 6,462.55 and the FTSE 250 by 2.98% to 18,746.51.

In parallel, Brent crude oil futures on ICE were down 7.68% to $46.15 a barrel in ICE trading, having earlier hit $45.28.

The yield on the benchmark 10-year Gilt was 10 basis points lower to 0.24%.

"For risk appetite to return in earnest we need to see a downturn in infection rates. If the rest of the world is following the China script (perhaps too much to hope for) then the growth in cases might begin to slow next week," said IG chief market anayst Chris Beauchamp.

"But it feels like we have a longer and harder road to travel in Europe and the US, with the latter a particular source of concern. And here is where the coronavirus has an impact on the presidential election."

Beauchamp also warned that the coronavirus could throw the US presidential elections wide open.

Earlier, the latest figures from Halifax showed that UK house prices rose for the fourth month in a row in February, although the outbreak of the coronavirus was cited as a risk going forward.

Stateside meanwhile, the Department of Labor announced a bumper 273,000 jump in non-farm payrolls for February, alongside big upwards revisions to the data for the prior two months combined.

Commenting on the latest employment data in the US, Ian Shepherdson at Pantheon Macroeconomics said: "Overall, these are great numbers, but unfortunately this is news from another planet, and it does not mean that the Fed was wrong to cut rates this week.

"The survey was conducted in the week ended Saturday February 15, four days before the market peaked [...] April likely will be much worse."

It was a sea of red in equity markets with Travel and Leisure issues again leading to the downside throughout most of the day.

But a near 10% slide in Brent crude towards the end of the session saw IAG jump back into the black, with easyJet and TUI nearly erasing their losses, although Carnival remained lower.

Not surprisingly, in the place of travel stocks, investors in BP, Shell and other oilers headed into the weekend nursing heavy losses.

At the individual level, Anglo American suffered the biggest drop on the top flight index after the miner declared 'force majeure' at the ACP phase A converter plant, at the Waterval smelter complex in Rustenburg, following a 10 February explosion within the converter.

Informa meanwhile was sent sharply lower by a recommendation downgrade out of Exane BNP Paribas, although by the end of trading it had largely recovered.

Events organiser Hyve was the worst performer on the FTSE 250 a day after warning on the impact from the virus, with analysts at Citi placing a 'negative catalyst watch' on its recommendation for the shares as well for those of Informa and Ascential.

Capita was down again as Deutsche Bank slashed its price target on the stock to 80.0p from 150.0p.

Cineworld was in the red again, having slumped 13% on Thursday, despite insisting that it had not seen any "material" impact on movie theatre admissions due to the Covid-19 outbreak and that it had continued to see "good levels" of admission in all its territories.

A downgrade to ‘neutral’ at Citi also weighed on the shares.

Victrex was knocked lower by a downgrade to ‘underweight’ at Barclays, Jupiter Fund Management was on the back foot after a downgrade to ‘sell’ at Berenberg and Hammerson fell after a downgrade to ‘neutral’ at Goldman Sachs.

Elsewhere, Morrisons clinged on to positive territory, underpinned by stockpiling news.

Market Movers

FTSE 100 (UKX) 6,462.55 -3.62%
FTSE 250 (MCX) 18,746.51 -2.98%
techMARK (TASX) 3,754.49 -3.09%

FTSE 100 - Risers

International Consolidated Airlines Group SA (CDI) (IAG) 431.60p 2.01%
Morrison (Wm) Supermarkets (MRW) 186.30p 0.59%
Ocado Group (OCDO) 1,125.00p 0.18%
Rolls-Royce Holdings (RR.) 588.20p 0.17%
Polymetal International (POLY) 1,298.00p 0.15%
Hargreaves Lansdown (HL.) 1,437.50p -0.10%
Tesco (TSCO) 240.60p -0.12%
Standard Chartered (STAN) 531.20p -0.19%
ITV (ITV) 102.30p -0.20%
WPP (WPP) 724.40p -0.41%

FTSE 100 - Fallers

Anglo American (AAL) 1,681.20p -8.70%
Smiths Group (SMIN) 1,408.00p -7.97%
Centrica (CNA) 69.76p -7.60%
Carnival (CCL) 1,981.50p -7.10%
Evraz (EVR) 269.10p -6.98%
Glencore (GLEN) 174.06p -6.79%
Melrose Industries (MRO) 182.90p -6.66%
Experian (EXPN) 2,618.00p -6.50%
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,730.00p -5.87%
Royal Dutch Shell 'B' (RDSB) 1,595.60p -5.85%

FTSE 250 - Risers

Restaurant Group (RTN) 86.15p 3.80%
Wizz Air Holdings (WIZZ) 3,451.00p 3.01%
Greggs (GRG) 2,180.00p 1.96%
Weir Group (WEIR) 1,296.50p 1.69%
Kainos Group (KNOS) 744.00p 1.64%
Apax Global Alpha Limited (APAX) 163.00p 1.24%
Synthomer (SYNT) 270.00p 0.75%
Convatec Group (CTEC) 185.55p 0.73%
Micro Focus International (MCRO) 684.90p 0.37%
Mitchells & Butlers (MAB) 313.00p 0.32%

FTSE 250 - Fallers

Hyve Group (HYVE) 54.60p -16.39%
Tullow Oil (TLW) 23.45p -15.37%
Spirent Communications (SPT) 217.00p -13.03%
Capita (CPI) 68.98p -11.45%
Avon Rubber (AVON) 2,410.00p -11.23%
Aston Martin Lagonda Global Holdings (AML) 265.90p -10.62%
Hunting (HTG) 270.60p -10.22%
Premier Oil (PMO) 61.62p -8.93%
Trainline (TRN) 413.00p -8.83%
Future (FUTR) 1,016.00p -8.80%