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Market round up: good day for crypto, bad day for stocks

By Ashley Norris

Fears of the ongoing economic impact of the coronavirus depresses European stock markets, but better than expected jobs figures rallies the Dow

Fears of the spread of the coronavirus, and its ongoing economic impact, has depressed European stock markets.

The FTSE 100 sank almost 0.51 per cent to 7466.70 points, France’s CAC 40 was down 0.21 per cent, and Germany’s Dax shed 0.40 per cent by close.

The slump was fuelled by a stream of bad news emanating from China. Last night, Pan Gongsheng, a vice governor of China’s central bank said the economy would be disrupted in the first quarter of the year. Credit rating agency S&P responded by cutting its Chinese 2020 growth forecast to 5 per cent, down from 5.7 per cent, blaming coronavirus for the fall.

It wasn't just European exchanges that were affected. Japan’s Nikkei fell 0.2 per cent, while Hong Kong’s Hang Seng dropped 0.4 per cent. In the US all eyes were on the latest jobs figures. Over 225,000 jobs were added to the economy in January, slightly more than investors expected. Even so the US unemployment rate moved slightly up to 3.6 per cent. Nevertheless, The Dow Jones was down 0.58 per cent in intra day trading and the S&P 500 dipped 0.21 per cent.

Alec Young, director of global markets research at FTSE Russell believes the good jobs news may have counterbalanced some of the negativity caused by the coronavirus “January’s better-than-expected jobs report is well-timed in that it boosts economic confidence just when coronavirus fears had investors questioning the growth outlook,” he argued. “That said, stocks are overbought after a huge rally.”

In the foreign exchange markets the pound edged up slightly against the dollar to $1.30 while it remained static against the Euro at €1.18. Bitcoin had another of its more turbulent days. It started the day at $9763 and rose steadily peaking at $9831 around UK noon. A significant slump was then addressed by a bounce and at 3PM UK time it was $9807, still tantalisingly short of breaking through the $10,000 barrier. Ethereum also had a solid day, starting at $212.95 and rising sharply to $222.76.

FURTHER READING: Chinese crypto miners put operations on hold due to coronavirus outbreak

FURTHER READING: US sees 225,000 new jobs during January

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