FTSE nudges higher as fears over second peak shake European traders

11 May 2020, 17:44

London skyline
London skyline. Picture: PA

The FTSE 100 closed 3.75 points higher at 5,939.73p at the end of trading on Monday.

Optimism over the easing of lockdowns across the globe faded on Monday as traders were left cautious over the potential for a second coronavirus peak.

However, the London markets nudged higher as multinational firms were bolstered by weakness in the value of the pound.

The FTSE 100 closed 3.75 points higher at 5,939.73p at the end of trading on Monday.

The index lifted slightly after the Prime Minister provided more detail over his “road map” for phasing out the coronavirus lockdown, despite worries that the message had caused confusion.

Connor Campbell, financial analyst at Spreadex, said: “The FTSE was something of an outlier … despite the mess made by Boris Johnson’s Government in trying to explain what happens next.”

The major European markets slipped into the red amid concerns that a second wave of infection could particularly hamper economies.

The German Dax decreased by 0.73%, while the French Cac moved 1.31% lower.

David Madden, market analyst at CMC Markets UK, said: “The easing of lockdowns has turned out to be a double-edged sword, as the move towards reopening economies boosted equities recently, but now there are fears that it might set the countries back in terms of the health crisis.

“Reports from South Korea and Germany show that new cases have jumped amid the easing of restrictions, and that’s why traders are dumping stocks today.

“When it comes to reopening the economy, there is a fear in the markets that it might be a case of one step forward and two steps backwards.”

Across the Atlantic, the Dow Jones opened lower due to fears about the possibility of a jump in the number of new coronavirus cases in some states.

Meanwhile, sterling slipped as traders continued to predict that it will be months before the UK begins to properly reopen its economy.

The value of the pound fell 0.58% versus the US dollar at 1.232 and was down 0.4% against the euro at 1.14.

Technology-oriented businesses, such as Ocado and Just Eat Takeaway, dominated the leaders in the FTSE 100 on Monday.

In company news, cycling and car accessories retailer Halfords jumped after the Prime Minister encouraged workers to cycle to work and avoid public transport.

Shares in the company leapt 36.8p to 188.2p at the close of play on Monday.

Elsewhere, British Airways owner IAG dropped lower after chief executive Willie Walsh told MPs that restructuring will be carried out across the group.

He said IAG is not “picking on” the British airline after announcing it will shed up to 12,000 jobs. Shares in IAG closed 5.5p lower at 184.95p.

The price of oil slumped as demand worries dashed an early increase in prices after Saudi Arabia announced plans to cut output.

The price of a barrel of Brent crude oil decreased 3.31% to 29.82 US dollars.

The biggest risers on the FTSE 100 were Hargreaves Lansdown, up 80p at 1,585p, Auto Trader, up 17.1p at 496.9p, Reckitt Benckiser, up 198p at 6,846p, and Ocado, up 50.5p at 1,914.5p.

The biggest fallers of the day were Centrica, down 3.52p at 36.39p, Evraz, down 16.7p at 253.3p, EasyJet, down 31.4p at 500p, and Informa, down 23.4p at 430.9p.

By Press Association

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