The COVID-19 pandemic gloom swept over markets on Friday, with small London companies suffering the brunt of the damage as investors expected longer locks and a bleak travel situation.
FTSE 250 MCX index,
fell 0.8%, matching losses across larger continental bands, and the FTSE 100 UKX,
we were not far behind with a 0.6% loss. Both indices are expected to drop more than 1% for the week.
“Weaker PMI services [purchasing managers index] Readings and the prospect of a total ban on travel in the UK have hit the leisure and travel sectors, as the outlook for the global economy becomes increasingly bleak, ”said IG Beauchamp, chief market analyst at IG, in note to clients.
The IHS Markit / CIPS UK Mixed Purchasing Managers’ initial flash index fell to 40.6 in January, down from 50.4 in December.
When asked if the normal lockout could be extended into the summer, Prime Minister Boris Johnson did not rule that out, as the country is dealing with a new, more contagious version of the coronavirus causing COVID-19. He said it was “definitely going to be a few weeks ahead. ”
Read: Paying to stay at home: reportedly the UK can pay those with COVID-19 £ 500 to separate themselves
The government added one or two more countries to the list of banned visitors – Tanzania and the Democratic Republic of the Congo – while Portugal suspended all flights to and from the UK. The European Union advised not to travel between countries at a meeting on Thursday, but stopped short of closing borders.
Airlines only saw the gloom on Friday, with International Consolidated Airlines down 3% on the FTSE 100, and shares of easyJet EZJ,
and Wizz Air WIZZ,
down 3% and 4%, respectively, on the smaller index. Sections of TRN Trainline,
which dropped rail books and coach travel, down 4.8%.
German-UK travel and tourism operator TUI TUI,
saw the biggest fall, with shares falling 15%.
And the release of the new James Bond film “No Time to Die” has been delayed for the third time due to the COVID-19 pandemic. Shares of film theater operator Cineworld Group CINE,
fell 4%.
Read: With the new Bond film postponed until October over COVID, it is bad news for cinemas
Above are shares of Kainos Group KNOS,
has gone up 18% on the FTSE 250, after the software company posted an advanced trade update. The company said continued business movement has led to strong trade and year-end March 2021 results are expected to come in forecast.