Stocks lower as UK declares coronavirus epidemic ‘imminent threat’
Stock markets opened lower on Monday as investor attention returned to the deadly outbreak of coronavirus
Stock markets opened lower on Monday, as investor attention returned to the deadly outbreak of coronavirus.
The FTSE 100 opened down 0.2% in London, while the more domestically-focused FTSE 250 was down 0.1%.
On the continent, the German DAX was 0.2% lower, the French CAC 40 slipped by 0.3%, and the Euronext 100 was down by 0.3%.
Coronavirus is the biggest threat flashing on traders’ platform on Monday morning, said Naeem Aslam, chief market analyst at Avatrade.
The UK’s health secretary declared the epidemic “a serious and imminent threat to public health” on Monday morning, as a fourth case of the virus was confirmed in the UK.
Chinese authorities said the death toll there had risen to 908, surpassing the total deaths from the deadly SARS outbreak in 2003. The number of confirmed cases has now crossed 40,000 in mainland China alone and 60 new cases have been recorded on a quarantined cruise ship in Japan.
The rising death toll comes as China tries to restart its economy after an extended Lunar New Year break. Chinese factories were due to reopen on Monday, although some — including the Foxconn factory where Apple iPhones are made — have remained shut.
Investors are concerned about the rising death number over in China and workers are not being able to return to work, Aslam said. The fear is that by opening factories you increase the risk of contamination.
Overnight in Asia, the Hong Kong Hang Seng stock index and Japan’s Nikkei index both closed down by 0.6%. The Shanghai Composite (000001.SS) rose by 0.5%, as the People’s Bank of China again injected liquidity into the banking system.
Coronavirus is at the forefront of the risk radar this week, but all the markets really care about is liquidity, said Neil Wilson, chief markets analyst at Markets.com.
US futures were pointing to a weak open later today. S&P 500 futures (ES=F) and Dow Jones Industrial Average futures (YM=F) were trading flat, although Nasdaq futures (NQ=F) were up 0.1%.
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