Coronavirus latest: Stock markets fall for second day as Covid-19 fears grow

A trader at the New York Stock Exchange on Monday
AFP via Getty Images
Tim Baker25 February 2020

Worldwide stock markets have plunged for a second day due to fears around the global coronavirus outbreak.

The FTSE 100 dropped by 0.7 per cent by Tuesday lunchtime, having slipped by 3.3 per cent on Monday.

Monday’s drop was the biggest fall in four years, and it saw more than £62 billion scrubbed from the value of the market index.

Tensions over Covid-19 are rising as Italy scrambles to contain a large outbreak of more than 280 cases in the north of the country and seven deaths.

It comes as Brits have been left trapped in a Tenerife hotel after it was put on lockdown due to an Italian national being diagnosed with the virus.

Coronavirus: Costa Adeje Hotel lockdown in Tenerife

1/24

Markets on the continent were harder hit than the UK.

On Tuesday, the Dax in Germany and France’s Cac 40 were 0.9 per cent lower each, having both fallen 4 per cent on Monday.

Spain’s Ibex was also more than 1 per cent lower after news broke of the positive case in the Canary Islands.

There was a slight rise on Tuesday morning as traders looked to take advantage of the previous day’s low prices.

The gentle upswing was also thanks to a cautious rise on the Hang Seng index in Hong Kong overnight.

But investors soon continued heading for the exit as it became clear the outbreak is far from being contained and will take a heavy toll on the global economy.

The FTSE 100’s woes were also compounded by gains for the pound on hopes of a major fiscal spending boost in next month’s Budget.

Sterling lifted 0.3 per cent to 1.30 US dollars and 0.5 per cent to 1.20 euros.

Police officers block access to Schiavonia hospital in Monselice, near Venice
AFP via Getty Images

Michael Hewson, chief market analyst at CMC Markets, warned there was likely to be further stock market uncertainty to come as the outbreak develops.

He said: “There is no question financial markets are coming round to the realisation that this particular crisis is likely to have a slightly longer shelf life than many thought was the case a couple of weeks ago.

“There appears little prospect that financial markets look likely to settle down in the short term, which means investors will have to get used to an extended period of uncertainty and volatility."

Travel stocks and airlines were once again among the biggest losers in London, following steep declines in Monday’s market falls.

Holiday giant TUI and low-cost carrier easyJet fell another 3 per cent and 2 per cent respectively, while Holiday Inn owner Intercontinental Hotels Group was 1 per cent down.

British Airways owner International Airlines Group was nearly 1 per cent lower after falling more than 9 per cent on Monday.

Create a FREE account to continue reading

eros

Registration is a free and easy way to support our journalism.

Join our community where you can: comment on stories; sign up to newsletters; enter competitions and access content on our app.

Your email address

Must be at least 6 characters, include an upper and lower case character and a number

You must be at least 18 years old to create an account

* Required fields

Already have an account? SIGN IN

By clicking Create Account you confirm that your data has been entered correctly and you have read and agree to our Terms of use , Cookie policy and Privacy policy .

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged in