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Market round-up: coronavirus continues to cast a shadow over world economy

By Ashley Norris

Gloom is compounded by a fall in energy giants' share prices

It wasn’t the best of mornings for the FTSE 100 in the UK. Overnight news about an increase in cases of coronavirus, as well as the implications the virus might have for the world’s economy, pushed shares down by as much as 1 per cent by lunchtime.

The gloom was compounded by a fall in share price for energy giants which largely counteracted the growth that they had shown earlier in the week. The biggest faller was Centrica slumping 15.29 per cent, or 13p, to 71.4p as the British Gas-owner moved to a loss of £1.1bn. The markets however briefly rallied in late morning after the news that Rishi Sunak is to replace Sajid Javid as chancellor of the exchequer.

Investors expressed hope that Sunak will start a new spending splurge to ignite the economy. Yet the optimism soon receded and the FTSE ended the day down 1.09 per cent at 7452.03. European stock exchanges were more measured in their response to the coronavirus with little movement in either the CAC 40 or the DAX. They may have been buoyed by news that the European Commission (EC) had left its growth forecast for the eurozone for 2020 and 2021 unchanged at 1.2 per cent. The French CAC 40 closed down 0.19 per cent while Germany's DAX closed down 0.03 per cent.

Coronavirus was also the big story in the US. Yesterday's record-breaking Dow Jones figures were wiped out after reports that the disease could spread in greater numbers than reported, ultimately affecting hundreds of thousands of Americans. The Dow Jones was down 0.21 per cent at noon EST. The Nasdaq was on a gentle upward trajectory - it started the day at 9657.04 and was at 9715.01 by lunchtime EST.

In the foreign exchange markets the pound-to-euro exchange rate reached its highest level since mid-December up a cent at €1.20. This completes four successive days of advances for sterling. Against the US dollar the pound ended the day up a whole cent at $1.31.

Bitcoin had another turbulent day. By the end of the morning in the UK it was down as low as $10,111. However it rallied at lunchtime before dropping back towards the end of the UK day. At the time of writing it was trading for $10,260. Ethereum, suffered a blip in its ongoing rise toward its marquee price of $300, but by the end of the day it recovered to finish at $269.50, up three cents on the morning.

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