London close: Stocks sharply lower amid second wave fears, trade concerns
London stocks finished well in the red on Wednesday, amid growing concerns about a spike in new coronavirus cases in the US.
The FTSE 100 ended the session down 3.11% at 6,123.69, and the FTSE 250 was off 2.84% at 17,150.83.
Sterling was weaker against its major trading pairs, last falling 0.75% against the dollar to USD 1.2426, and sliding 0.37% on the euro to €1.1031.
“One of the reasons investors are quite so distressed is that Bloomberg has reported the US is preparing to slap tariffs on $3.1bn worth of goods from the UK, Spain, France and Germany, as it gears up for a summer showdown with the European Union,” said Spreadex financial analyst Connor Campbell.
“Add onto that the already high-intensity panic over the increasing likelihood of a second wave – with outbreaks in Beijing and Tokyo, a worrying R rate in Germany, and an alarming surge in hospitalisations in the United States – and the markets were a mess.”
Campbell said that, given the major issues troubling investors, any rebuttal from Washington regarding the US-Europe trade situation could be “a life saver”.
“Because, let’s be honest, any good news on the second wave front looks pretty impossible at the moment.”
A report suggesting that European Union countries could bar entry to Americans, as the US had failed to control the coronavirus pandemic, also dented the mood.
In equity markets, oilfield services firm Petrofac was 14.86% weaker after saying that its group order backlog fell 13% at the end of May as it warned of a significant impact on its engineering division from the coronavirus pandemic.
Housebuilder Crest Nicholson suffered losses of 18.18% after it reported a slump in half-year revenue and profit as it took a hit from the Covid-19 pandemic, and said full-year profit was set to fall.
Pub groups Mitchells & Butlers and JD Wetherspoon were both lower, by 7.27% and 7.03% respectively, having rallied strongly on Tuesday ahead of Prime Minister Boris Johnson’s announcement about the reopening of pubs on 4 July.
JD Wetherspoon was also in focus after it confirmed it had secured a £48.3m loan under the government’s coronavirus loan scheme as it prepared to open 750 pubs on July 4.
Shares of AG Barr fizzed 7.07% lower after the Irn-Bru maker said late on Tuesday that its sale and distribution contract with US energy drinks company Rockstar had been terminated and that trading continues to be dented by the lockdown.
Gambling company GVC reversed earlier gains to close off 2.54%, after earlier saying that sports betting was reviving in line with its expectations as events resumed and that it was encouraged by early signs of customers returning to its retail outlets as Covid-19 restrictions were relaxed.
Pets at Home ended the session down 3.17%, having earlier been boosted by an upgrade to ‘buy’ at Citi.
Kingfisher, Next and Dunelm were all hit by a downgrade to ‘sell’ by the same outfit, closing down 6.08%, 5.73% and 4.15%, respectively.
Market Movers
FTSE 100 (UKX) 6,123.69 -3.11%
FTSE 250 (MCX) 17,150.83 -2.84%
techMARK (TASX) 3,694.76 -3.21%
FTSE 100 - Risers
Avast (AVST) 526.50p 1.45%
Sainsbury (J) (SBRY) 205.90p 0.64%
Polymetal International (POLY) 1,583.00p 0.51%
Ocado Group (OCDO) 1,987.00p 0.30%
Aveva Group (AVV) 4,099.00p -0.51%
Severn Trent (SVT) 2,499.00p -0.52%
Homeserve (HSV) 1,302.00p -0.61%
Croda International (CRDA) 5,150.00p -0.81%
Just Eat Takeaway.Com N.V. (CDI) (JET) 8,170.00p -0.90%
Admiral Group (ADM) 2,305.00p -1.12%
FTSE 100 - Fallers
International Consolidated Airlines Group SA (CDI) (IAG) 230.40p -8.54%
Smith & Nephew (SN.) 1,490.00p -7.45%
Whitbread (WTB) 2,204.00p -7.08%
Kingfisher (KGF) 213.10p -6.08%
BAE Systems (BA.) 479.60p -5.78%
Next (NXT) 4,900.00p -5.73%
3i Group (III) 788.00p -5.56%
Rolls-Royce Holdings (RR.) 300.20p -5.54%
Standard Life Aberdeen (SLA) 254.70p -5.53%
Compass Group (CPG) 1,113.00p -5.44%
FTSE 250 - Risers
AO World (AO.) 140.60p 1.88%
BMO Commercial Property Trust Limited (BCPT) 71.60p 1.42%
Softcat (SCT) 1,079.00p 1.22%
FDM Group (Holdings) (FDM) 939.00p 1.08%
NextEnergy Solar Fund Limited Red (NESF) 107.80p 0.56%
Sanne Group (SNN) 643.00p 0.47%
Civitas Social Housing (CSH) 107.40p 0.37%
Genus (GNS) 3,506.00p 0.23%
Trainline (TRN) 499.00p 0.08%
Greencoat UK Wind (UKW) 143.60p 0.00%
FTSE 250 - Fallers
Crest Nicholson Holdings (CRST) 205.20p -18.18%
Petrofac Ltd. (PFC) 187.65p -14.86%
Micro Focus International (MCRO) 426.90p -9.94%
TUI AG Reg Shs (DI) (TUI) 380.00p -8.83%
Cairn Energy (CNE) 113.80p -8.81%
Carnival (CCL) 1,041.50p -8.72%
Watches of Switzerland Group (WOSG) 275.00p -8.33%
Ascential (ASCL) 279.80p -7.96%
Wood Group (John) (WG.) 201.80p -7.85%
Hammerson (HMSO) 95.60p -7.77%