FTSE stalls decline as UK pandemic news provides hope
Fiona Cincotta March 30, 2020 5:17 AM
With Europe fully in the grip of the coronavirus, and speeding up in the US, little wonder that the markets have started on a weaker footing across Europe. However some glimmers of hope have helped the FTSE bounce.
With Europe fully in the grip of the coronavirus, and the spread speeding up in the US, it's little wonder that the markets have started on a weaker footing across Europe. But some glimmers of hope like the slight slowing down in the number of new UK cases and an antibody test that could be available within days in the UK, have helped the FTSE bounce from the lows it has reached.
Defense and aerospace contractor Meggitt, one of the first UK firms to decide to protect cash flow and not pay any dividend until the autumn is hit the hardest, down 13%. Meggitt’s decision had already come on Friday, but it came ahead of a broader recommendation from the ECB for banks to hold out on dividend payments for roughly six months. Other firms are likely to follow as they hunker down to survive the crisis.
Some UK stocks bounces
The number of cases in the UK is still just under 20,000 as the first two weeks of social distancing are nearly over. The UK, which is undoubtedly at least a week to ten days behind Germany and France on the virus spread curve is, for the moment, managing to contain the numbers to a lower band compared with Germany’s and France’s 80,000. Whether today’s numbers will lead to any easing of restrictions in the UK remains to be seen.
On the FTSE, several groups of companies have emerged as those that will emerged from the COVID-19 epidemic the least damaged, and they are clearly in the black this morning. Top of the leader board are precious metals and gold producers followed by waste management firms Pennon Group and Rentokil, pharmaceuticals, delivery companies, supermarkets and, for a dose of safe haven buying – utilities.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.