LONDON, March 18 ― London's main share index rose yesterday as the US Federal Reserve's move to purchase short-term corporate debt and Britain's expected rescue package to help coronavirus-hit businesses brought back some confidence among investors.
The blue-chip FTSE 100 rose 2.8 per cent, led by healthcare and consumer stocks.
Chilean copper producer Antofagasta jumped 16.0 per cent after posting higher annual profit aided by rising sales and falling costs, though it also flagged a review of its spending plans due to the tough global economy.
US stocks reversed early losses to trade higher yesterday as the Federal Reserve said it would relaunch financial crisis-era purchases of short-term corporate debt to thaw credit markets strained by the coronavirus pandemic.
Shares in the world's biggest catering firm Compass Group slumped 4.2 per cent to their lowest since June 2013 after it said half-yearly operating profit would miss expectations due to steps taken in Europe and North America to limit the spread of the virus.
Prime Minister Boris Johnson on Monday ordered the most vulnerable to isolate for 12 weeks and asked people to avoid pubs, clubs, restaurants, cinemas and theatres, though he stopped short of ordering them to close.
Foreign Minister Dominic Raab also advised Britons to stop all non-essential travel globally for the next 30 days.
“As the UK becomes the latest country to announce stringent self-isolation measures to suppress the coronavirus, markets are attempting to put on a brave face about the outbreak,” AJ Bell investment director Russ Mould, said.
The domestically focussed FTSE 250 index shed early gains to fall 3.0 per cent in its ninth straight session of losses, with Cineworld plunging 43.0 per cent to a record low as it closed theatres in light of the coronavirus outbreak.
Through Monday, the number of confirmed coronavirus cases in Britain rose to 1,543, up from 1,372 the day before, while the UK death toll rose to 55.
British Finance Minister Rishi Sunak said lenders will offer a three-month mortgage holiday to those in difficulty, adding that he will set out the next stage of help in the coming days.
That follows a £30 billion (RM158.3 billion) stimulus package he unveiled last week.
There was no respite for travel stocks, with British Airways parent IAG and easyJet falling 6.5 per cent and 6.1 per cent as airlines made unprecedented cuts to flights, costs and staffing and stepped up calls for emergency aid.
“No monetary and fiscal policy unfortunately can alter the spread of the virus,” Simona Gambarini, markets economist at Capital Economics, said. “It's unlikely that the stock market and other risky assets will rebound on a sustained basis.”
Electricals retailer Dixons Carphone rose 10.8 per cent after saying it would axe 2,900 jobs as it closes all 531 UK standalone Carphone Warehouse stores.
Supermarket group Morrisons shares jumped 9.8 per cent after it said it plans to create 3,500 new jobs and expand its home delivery operation to help get through the coronavirus crisis. ― Reuters
