• FTSE 100  finishes down 19 points
  • Resource stocks drag the Footsie lower
  • US benchmarks higher

5.10pm: FTSE closes in red

FTSE 100 index closed Monday in the red but Wall Street went higher as traders still fretted about the coronavirus threat and following Chinese inflation data.

Footsie closed nearly 20 points lower at 7,446.

FTSE 250 also lost ground to stand at 21,493.

Over on Wall Street, the Dow Jones Industrial Average added over 52 points, while the S&P 500 added nearly eleven.

“A recovery is underway on Wall Street, but investors will be wondering whether this is merely dependant on the latest figures out of China,” said Chris Beauchamp, chief market analyst at spreadbetter IG Index.

“Certainly, with the growth of the virus still a concern, markets will have to be cautious, and it looks like there are plenty of investors concerned about adding to risk in the current environment.”

The analyst added: “The spike in Chinese CPI will also have some expecting a more dovish approach from the PBoC, a bank conscious that rising prices are an additional burden on a country already grappling with a dramatic economic slowdown.”

4.05pm: FTSE 100 down

London’s leading shares look set to finish the day modestly lower on balance, with resource stocks largely responsible for the Footsie’s fall.

The FTSE 100 index was down 24 points (0.3%) at 7,442, with the retreat led by utility company Centrica PLC (LON:CNA), which was off 2.3%.

Oil giants BP PLC (LON:BP.) and Royal Dutch Shell (LON:RDSB) fell 0.7% and 1.0% as investors fretted about the effects of the coronavirus on the world economy while mining titans such as Glencore PLC (LON:GLEN), Rio Tinto plc (LON:RIO) and BHP Group (LON:BHP) were down by 1.1% to 1.7% for much the same reason.

In contrast, property companies British Land PLC (LON:BLND) and Land Securities PLC (LON:LAND) were among the best performers, advancing 1.6% and 1.5% respectively.

3.10pm: US stocks open mixed

While in the UK, the Footsie appears largely dormant, US stocks are mixed.

Stateside, the Dow Jones was down just 11 points (0.0%) at 29,097 while the broader-based S&P 500 was up a point (0.0%) at 3,329.

In Blighty, the FTSE 100 has set up camp in the afternoon session around the 7,430 level – down 36 points (0.5%).

Drugs giant GlaxoSmithKline PLC (LON:GSK) defied the trend, rising .4% to 1,707p, despite Deutsche Bank lopping 50p off its price target at 1,600p.

Hotels and restaurants owner Whitbread PLC (LON:WTB), meanwhile, shed 55p at 4,564p after Goldman Sachs downgraded the stock to ‘sell’ from ‘neutral’.

The Premier Inns owner could have a new sector peer before the end of the quarter, with reports suggesting the German ‘hybrid-hotels’ chain owned by Holidaybreak could float soon. (READ more on the Meininger Hotels IPO here.)

2.20pm: Soft start expected in the US

US stocks are expected to open lower with investors concerned about the continued spread of the coronavirus.

Spread betting quotes suggest that the narrowly-based Dow Jones 30-share average will open just six points lower at 28,996 but the broader-based S&P 500 is expected to fall 10 points to 3,318.

In the UK, the FTSE 100 was down 26 points (0.4%) at 7,441.

1.40pm: Sterling’s strength weighs on the Footsie

London’s index of leading shares is faring pretty well considering the pound is up by almost half a cent against the US dollar.

A strong pound is generally an albatross around the neck of the global companies that comprise the bulk of the FTSE 100 but nevertheless, the index is only down 20 points (0.3%) at 7,447.

The FTSE 250, which is far less dependent on a soft exchange rate, is down 14 points (0.1%) at 21,485.

Mid-cap Finablr PLC (LON:FIN) was doing its bit to shore up the FTSE 250 with a 7.6% rise at 76.9p; the stock was wanted after it said it had recently been made aware of purported arrangements between Dr BR Shetty, Saeed Mohamed Butti Mohamed Al Qebaisi and Khaleefa Butti Omair Yousif Al Muhairi, which may be relevant to their respective interests in the company’s shares.

Dr BR Shetty is the joint chairman of NMC Health PLC (LON:NMC), which is currently the subject of a considerable amount of bid speculation.

NMC said that Shetty is in the process of carrying out a legal review in order to verify his total interests (including family members and associated family holding companies) and that this review also has implications for the holdings and interests of Saeed Mohamed Butti Mohamed Khalfan Al Qebaisi and Khaleefa Butti Omair Yousif Ahmed Al Muhairi.

As they used to say on US comedy programme, Soap: Confused? You will be …

 

11.50am: Coronavirus death toll in China hits 906

If you are keeping count – and the stock market is – the death toll from the coronavirus in China has now reached 908.

The FTSE 100, down 17 points (0.2%) at 7,450, remains in the doldrums largely because of concerns over the epidemic.

“The bullish run that lasted most of last week seems like a distant memory. The surge in stocks was driven by the policies of the Chinese authorities, so now the positive sentiment is fading. The deepening health crisis is chipping away at market confidence. In London, stocks that are connected to China are under pressure. Mining, energy as well as travel stocks are in the red,” reported CMC Markets’ David Madden.

One energy stock that is going well is Rose Petroleum PLC (LON:ROSE) after it updated on the Rocky Mountain and Utah Paradox projects.

The shares climbed 12% to 1.15p after the explorer revealed it has received regulatory approval to extend its lease over the Paradox project, securing some 11,300 acres in the core project area for two more years, while in the Rocky Mountain region, which is now Rose’s main focus, the company said it has achieved key milestones in the acquisition process.

Leak detection specialist Water Intelligence PLC (LON:WATR) found a new level at 347.5p, up 30p, after it said results for 2019 are roughly one year ahead of schedule – presumably in terms of revenue and profit levels, rather than release date – and higher than market expectations for revenue and adjusted profits before tax.

10.40am: Return to work in China fails to lift sentiment

The headline Sentix investor sentiment survey covering the Eurozone fell to 5.2 in February, from 7.6 in January, marginally below the consensus forecast of 5.9.

It is the first Sentix survey for the Eurozone since the coronavirus hit the headlines and indicates that sentiment is still positive, even if it has taken a bit of a hit.

Talking of the coronavirus, news that the number of deaths from the coronavirus has exceeded those from the SARS outbreak in 2003 “appears to have given investors pause for thought on Monday,” according to AJ Bell’s investment director, Russ Mould.

“China is, in theory, returning to work today after an extended New Year holiday aimed at containing the virus, but not all factories are coming back on line yet.

“The pace of this process could be telling in the eventual economic impact of the health crisis so markets are likely to be following events closely.

“One of the first announcements on the Chinese economy since the outbreak began was released this morning, notably showing a big rise in inflation as food prices soared,” Mould said, adding that equities still look vulnerable to further weakness if, as the World Health Organization predicted, we are likely to see a lot more cases of people contracting the virus outside of China.

Be that as it may, the FTSE 100 has just pulled off the bottom in mid-morning trading but remains 35 points (0.5%) lower at 7,431.

It’s not been a good morning for UP Global Sourcing Holdings PLC (LON:UPGS), which tumbled 8.7% to 59.8p on the back of a trading update that alerted investors to how much of the group’s manufacturing is based in China.

“The extension of the Chinese New Year holiday by nine days to today (Monday 10 February) in the group’s main manufacturing areas is expected to cause production delays,” it revealed.

9.30am: Chinese inflation spikes

A sharper than expected rise in Chinese inflation has given investors further cause to worry about the impact of the coronavirus.

Consumer price index inflation in the People’s Republic in January rose to 5.4% from 4.5% in December, which was well ahead of the consensus forecast of 4.9%.

The producer price index was 0.1% higher year-on-year, compared to a fall of 0.5% in December and a consensus forecast of no change.

“Commodities and processing inflation pushed higher, thanks to base effects, and price gains on the back of the Phase One trade deal, before the virus scare. Inflation could rise further in February, as developments at the factory gate lag spot prices by about a month. The effects of the virus should then start to dominate,” warned Freya Beamish, Pantheon Macroeconomics’ chief Asia economist.

“Manufacturing deflation remained in place but tends to lag commodities prices by around two months, suggesting an imminent return to inflation.

“These data will give the authorities little to go on, as they reflect trends prior to the damaging effect of the virus on commodities. Nevertheless, commodities prices should rebound strongly once the virus is contained,” she added.

The FTSE 100 index was down 28 points (0.4%) at 7,439.

Defying the trend with a 6.9% rise was under-fire Middle Eastern hospitals operator, NMC Health PLC (LON:NMC) after it revealed it had received two “highly preliminary” bid approaches – one from Kohlberg Kravis Roberts and the other from another US private equity firm, GK Investment.

8.30am: Footsie laid low by niggling coronavirus worries

The FTSE 100 kicked off exactly where predicted – 15 points in the hole as traders assessed the growing threat of the coronavirus with an almost weary resignation.

The outbreak has now claimed more lives that the 2003 SARS epidemic and is expected to hobble Chinese manufacturing – an integral part of the global supply chain.

“Workers at the Foxconn factory in Zhengzhou [where the iPhone is made] getting the go-ahead to return to work is hopefully a sign the worst economic drag from the coronavirus outbreak is behind us,” said Jasper Lawler, analyst at CMC Markets.

“However, five Britons contracting it in the French alps is a warning that things could take a turn for the worse again.”

Back in London, the morning’s big mover, down 2.7%, was Whitbread (LON:WTB), which was cut to ‘sell’ by Goldman Sachs.

Moving down a division, the FTSE 250’s biggest winner was William Hill (LON:WMH), with the bookie in ‘final furlong’ of negotiations over a US sports betting deal with media giant CBS. The shares advanced 5%.

Proactive news headlines

Intellectual property specialist Tekcapital PLC (LON:TEK) said one of its portfolio companies is working on a technology that could be used to treat coronavirus victims. Belluscura and its research partner Separation Design Group have filed a patent on an oxygen enrichment system for people suffering acute respiratory distress, which occurs in those worst affected by the illness.

ClearStar Inc (LON:CLSU) chief executive Robert Vale described as “another fantastic customer win” a screening services contract with a leading facilities management company.

Angling Direct PLC (LON:ANG) has appointed Andy Torrance as its new chief executive to replace Darren Bailey who is stepping down after 17 years at the retailer.

Iconic Labs PLC (LON:ICON) has delivered an update to investors following the relaunch of its LGBTI+ news website, Gay Star News (GSN), at the end of January.

NEX-listed Sativa Group PLC (LON:SATI) expects gross profit and underlying earnings (EBITDA) for the year to 31 December to be ahead of guidance.

Cabot Square Alternatives Plc (LON:ALTS) has updated on plans for its initial public offering (IPO) ahead of its float on the London Stock Exchange next week.

MTI Wireless Edge Ltd (LON:MWE) has won a contract worth around US$1.5mnn for the supply of radio frequency components.  

Sustainable polymers specialist Itaconix PLC (LON:ITX) has unveiled a new line of functional additives derived from itaconic acid that can be used across a number of product areas, including paints and biodegradable plastics.

Crossword Cybersecurity PLC (LON:CCS) said revenues for 2019 are expected to come in at £1.3mln, in line with market expectations.

Xpediator PLC (LON:XPD) said profits were in line with expectations as turnover rose by nearly 20% in 2019 as the freight management specialist enjoyed the benefits of acquisitions and organic growth.

BATM Advanced Communications Ltd (LON:BVC) has secured a third contract for its agri-waste treatment solution with a major poultry processor in the Middle East.

Shanta Gold Ltd (LON:SHG) is to purchase 100% of the shares of Acacia Exploration (Kenya) Ltd, the local Kenya subsidiary of Barrick Gold (NYSE:GOLD)(TSE:ABX). The primary asset is a 100% participating interest in the West Kenya project which has a resource currently pegged at just under 1.2mln ounces. 

Panther Metals PLC (LON:PALM) has been granted an exploration licence over the Annaburroo gold project in the Northern Territory of Australia. 

Thor Mining PLC (LON:THR)(ASX:THR) has completed the sale of its stake in Hawkstone Mining Ltd (ASX:HWK) for A$103,000.

Rose Petroleum PLC (LON:ROSE) has received regulatory approval in Utah to extend its lease over the Paradox project, securing some 11,300 acres in the core project area for two more years. In the Rocky Mountain region, which is now Rose’s main focus, the company said it has achieved key milestones in the process of acquiring the McCoy lease – a 317 acre area in Colorado’s Denver-Julesburg Basin.

Cadogan Petroleum Plc (LON:CAD) told investors that net production grew by 15% in 2019, even after a 30-day shut down for certain operations during the fourth quarter.

Tower Resources PLC (LON:TRP) told investors that the well site survey is now complete at the Thali licence, offshore Cameroon.

Bahamas Petroleum Company PLC (LON:BPC) said an extension has been made to the deadline for qualified Bahamian investors to invest in a Bahamian incorporated mutual fund that will invest in the company. Leno Corporate Services Limited, which is managing the fund, has extended the initial subscription period by three days to 5pm EST on Wednesday 12 February.

Ormonde Mining plc (LON:ORM) said it has identified two new non-executive director nominees to replace Michael Donoghue and John Carroll, assuming completion of the proposed disposal of the company’s 30% interest in the Barruecopardo Tungsten mine. The proposed disposal is up for a shareholder vote at a general meeting on Thursday 13 February.

6.31am: Subdued start predicted 

The FTSE 100 looks set to take its cue from Asia by opening its weekly account in the red.

China led the region lower as the death toll from the coronavirus pushed past 813, exceeding the number killed by the 2003 SARS epidemic.

The outbreak is threatening to derail manufacturing in the region.

Many facilities remain shuttered to prevent the spread of the virus, which will inevitably have a knock-on impact on businesses further along the supply chain.

For example, it is uncertain whether Foxconn will be allowed to re-open its iPhone production site in Shenzhen after the holiday break.

“The restart of this facility, the most critical iPhone production site, would be a major boost to confidence that the virus is not going to have that big an impact on the global economy and would probably be a major “risk on” signal,” said Marshall Gittler of BDSwiss.

“I think we could see a quick reversal in trend – some temporary short-covering at least – if an announcement along those lines comes out.”

Back here in the UK, it looks like another busy week for scheduled news with Royal Bank of Scotland (LON:RBS), Barclays (LON:BARC) and AstraZeneca (LON:AZN) among a strong cast set to update on progress.

Around the markets: Pound US$1.2905 (up 0.1%); gold US$1,573.90 an ounce, up 50 cents; Brent crude US$54.50 a barrel, up 3 cents

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