London close: Stocks dip as raft of corporates warns of coronavirus impact

The FTSE 100 was down 0.51% on Friday at 7,466.70, but 2.5% higher for the week, while the second-tier index was off by 0.34% to 21,499.29 for the session and up 1.7% over the past five days.

The coronavirus remained firmly in focus after the People’s Bank of China said the outbreak could disrupt the country's economy in the first quarter, but that a recovery was expected once the virus was brought under control.

Neil Wilson, chief market analyst at Markets.com, said: "On the ground it’s still rather grim. Shenzhen is now in lock down. Cases have risen to more than 31k - but the number of newly confirmed coronavirus cases decreased for the second straight day, China’s National Health Commission said."

Echoing Wilson's assessment, throughout the day a raft of corporate names from around the world warned of the impact that the virus was taking on their operations, including Burberry, Toyota Motor, Hon Hai Precision (a key supplier of US tech giant Apple) and Canada Goose.

Investor caution was such that a much stronger-than-expected reading on the US jobs market was largely ignored.

According to the US Department of Labor, non-farm payrolls jumped by 225,000 in January (consensus: 160,000), helped in part by the third mildest temperatures on record for that month, which took the three-month average gain in NFP to a strong 211,000.

Of interest, following the jobs numbers, Ian Shepherdson at Pantheon Macroeconomics wondered aloud whether the US-China trade war might have led companies to be more aggressive in their wage bargaining with staff over the summer, predicting that faster wage gains were likely ahead as labour shortages became more acute.

Across the Channel meanwhile, a much weaker-than-expected reading on German industrial output for the month of December breathed new life into talk of a possible recession.

And in China, the customs administration postponed the release of international trade figures for January due to the disruptions wreaked by the coronavirus.

Back home, mortgage lender Halifax reported a 0.4% month-on-month and 4.1% year-on-year advance in home prices.

In corporate news, NMC Health was sharply lower again. Earlier in the week, the Financial Times reported that the UAE private healthcare operator’s founder was looking to buy out his Emirati partners and return to an "active leadership position" at the company. Shares of NMC have taken a tumble since US research firm and short seller Muddy Waters accused the company in December of manipulating its balance sheet to understate debt.

Hargreaves Lansdown was under pressure as co-founder Peter Hargreaves sold just under 34.4m shares in the company. Hargreaves sold the shares to institutional investors via an accelerated bookbuild at £16 each, raising gross proceeds of £550m.

He said: "The sale of some of my shares in Hargreaves Lansdown is part of a process of long-term financial planning to diversify my assets. I remain, and will continue to be, a substantial shareholder in Hargreaves Lansdown. I am very proud of the business that I co-founded and helped build."

Burberry was down after it said the coronavirus was affecting its sales in China and Hong Kong and that more than a third of its stores in mainland China were closed. The luxury goods company said 24 of its 64 mainland China stores were closed. Its other outlets are operating with reduced hours and customer footfall is down significantly.

Miners retreated, with Glencore, Antofagasta and BHP all on the back foot, while airlines easyJet and British Airways parent IAG flew lower.

On the upside, Vodafone was the standout gainer after an upgrade to ‘buy’ at Jefferies, while insurer Hastings was boosted by an upgrade to ‘overweight’ from ‘equalweight’ at Morgan Stanley.

TUI gained as it agreed to sell its Hapag-Lloyd Cruises business to TUI Cruises, the company's 50:50 joint venture with Royal Caribbean Cruises, for an enterprise value of €1.2bn (£1bn).

Beazley was in the green for the second day running after it reported a better-than-expected surge in full-year profit on Thursday.

Market Movers

FTSE 100 (UKX) 7,466.70 -0.51%
FTSE 250 (MCX) 21,499.29 -0.34%
techMARK (TASX) 4,147.21 -0.03%

FTSE 100 - Risers

Smurfit Kappa Group (SKG) 2,944.00p 3.23%
Standard Life Aberdeen (SLA) 317.10p 1.93%
Ferguson (FERG) 7,450.00p 1.72%
TUI AG Reg Shs (DI) (TUI) 863.60p 1.50%
HSBC Holdings (HSBA) 581.30p 1.36%
Vodafone Group (VOD) 153.04p 1.34%
Polymetal International (POLY) 1,275.50p 1.23%
Aveva Group (AVV) 5,210.00p 1.07%
Morrison (Wm) Supermarkets (MRW) 180.90p 0.67%
Hikma Pharmaceuticals (HIK) 1,912.00p 0.66%

FTSE 100 - Fallers

NMC Health (NMC) 703.20p -22.22%
Hargreaves Lansdown (HL.) 1,604.50p -6.09%
Antofagasta (ANTO) 847.40p -3.61%
Carnival (CCL) 3,114.00p -2.99%
BHP Group (BHP) 1,673.60p -2.74%
Melrose Industries (MRO) 241.80p -2.70%
Anglo American (AAL) 2,032.50p -2.63%
InterContinental Hotels Group (IHG) 4,793.50p -2.57%
JD Sports Fashion (JD.) 835.00p -2.54%
Glencore (GLEN) 233.20p -2.43%

FTSE 250 - Risers

Future (FUTR) 1,250.00p 7.39%
Network International Holdings (NETW) 636.00p 3.92%
Beazley (BEZ) 597.00p 3.80%
Games Workshop Group (GAW) 7,315.00p 2.37%
Dechra Pharmaceuticals (DPH) 2,916.00p 2.17%
Mitchells & Butlers (MAB) 412.50p 2.10%
St. Modwen Properties (SMP) 504.00p 1.92%
Fresnillo (FRES) 664.80p 1.68%
Safestore Holdings (SAFE) 793.50p 1.59%
William Hill (WMH) 173.05p 1.58%

FTSE 250 - Fallers

Hyve Group (HYVE) 95.30p -4.22%
Kaz Minerals (KAZ) 475.00p -3.94%
Hunting (HTG) 307.40p -3.88%
Cairn Energy (CNE) 166.70p -3.86%
Frasers Group (FRAS) 464.60p -3.81%
Oxford Instruments (OXIG) 1,600.00p -3.26%
Drax Group (DRX) 289.20p -3.21%
Tullow Oil (TLW) 47.83p -3.14%
Aston Martin Lagonda Global Holdings (AML) 450.60p -3.10%
Helios Towers (HTWS) 142.00p -3.07%