FTSE100 drops 3% as coronavirus causes markets around the world to slide
MARKETS have taken a battering again today with the FTSE100 falling by 3.6 per cent to a four-year low as coronavirus continues to make its way around the globe.
It comes as 163 people in the UK have been confirmed as infected with COVID-19, while the UK has also seen its first coronavirus death, and possibly now a second (tests awaiting) - see our live blog for the latest.
The unstoppable spread of the outbreak sent stocks tumbling into the red and has seen them resume their coronavirus sell-off after initially beginning to recover.
In the UK, the FTSE100 index of the largest companies based here has plunged by 3.6 per cent - or 242 points - from 6,705 when the market opened this morning to 6,462 now.
It's a four-year low for the index which hasn't been at these levels since the summer of 2016, around the time of the British referendum to leave the European Union.
A 110-point drop yesterday first brought to a halt a three-day bounce back for the UK index as officials said Britain is edging towards a widescale coronavirus outbreak.
Last week, saw the FTSE100 drop by 13 per cent in just one week.
Global markets tumble
But it's just not just the UK that's taken a hit. In France, the Cac40 tumbled 4.1 per cent, while the German Dax was 3.3 per cent down.
The US and Asia have also experienced heavy stock market falls.
New York's Stock Exchange is down 3 per cent at 12,210, while Wall Street's Dow Jones has fallen 2.1 per cent to 25,569 at the time of writing.
Japan's Nikkei225 is down 2.7 per cent at 20,749.
Connor Campbell, financial analyst at Spreadex, said: "With no signs of the outbreak slowing down... investors remain gripped with a near unshakeable panic, the week's various central bank rate cuts only serving to reinforce the seriousness of the situation."
What should I do if I'm worried about my pensions and investments?
ADRIAN Lowcock, an expert at investment firm Willis Owen, gives his top tips for those worried about the impact of coronavirus on their pensions and investments:
- Do not panic – It is important to remember that making investment decisions based purely on emotions is rarely a good idea.
- Take some time – Give yourself some breathing space to review the situation, think about what you are really trying to achieve with your investments and what, if any actions you can take now to help you achieve your goals.
- Diversify your portfolio – As part of a diversified portfolio it is important to have some assets which tend to perform well when investors get risk-averse. This includes exposure to gold, government bonds and absolute return funds. These assets are unlikely to perform as well as investing in shares but they are good at capital preservation.
- Have some cash – It is always a good idea to have a bit of cash set aside so that you are able to take advantage of any big falls in markets. It is hard to predict exactly when markets will fall or indeed how far, but it is much easier to put money to work once the markets have fallen.
- Accept the volatility – The fact of the matter is that investing in shares and other assets means the value of your investment will rise or fall depending on a wide range of conditions. It is important to accept that volatility is part of the journey and take the rough with the smooth.
Russ Mould, investment director at AJ Bell added: "Non-stop news headlines about the spread of coronavirus has caused investors to be very concerned about a global recession.
"This tension is likely to remain front and centre until we get some evidence that the virus can be contained."
Hotel and travel companies take the brunt of the hit
Hotel and travel companies are once again among the worst hit in the latest leg of the coronavirus sell-off. Holiday Inn owner InterContinental Hotels and Premier Inn group Whitbread had fallen 6 per cent on London's FTSE100 during the day.
But by close of market they were down 1.3 per cent and 3.5 per cent respectively.
Tour operator Tui was 5 per cent lower, although that climbed to 1.9 per cent down at close.
While cruise ship giant Carnival tumbled 6 per cent as demand for bookings slumps amid a wave of cancellations from worried holidaymakers, although this has since decreased to a fall of 1.5 per cent.
More on money
Airlines have also been badly impacted, with the collapse of Flybe raising fears that other vulnerable players may go bust in the fallout from coronavirus.
In London, British Airways owner International Airlines Group (IAG) and low-cost rival easyJet both saw shares drop 5 per cent.
Although at close of play, IAG was up 2 per cent, while easyJet was down 1 per cent.