The FTSE opened 1.5% lower at 6,900 points and continued to plunge through morning trade. This followed the sea of red ink on European markets which fell sharply as fears escalate that the coronavirus will make a big dent in corporate profits.
In Asia, Japan’s Nikkei 225 was off 2% but China’s SSE index bucked the negative trend and rallied 2% on stimulus hopes and fewer virus deaths.
Oil prices followed the negative moves with Brent crude prices down 1.4% while gold, seen as a safe haven, saw more gains with prices up 0.5% to $1,645/oz. Meanwhile the pound was steady against the dollar at $1.29.
In response to slowing growth, US bond prices hit new highs on anticipation of more rate cuts from central banks.
UAE-based health care provider NMC Health (NMC) finally threw in the towel and suspended its shares after the board discovered unapproved financing to connected parties, casting further doubt on the company’s accounting practices.
The world’s biggest advertising company WPP (WPP) reported full-year revenues down 1.6% to £10.8bn and a lower profit margin reflecting ‘challenging conditions’. The company said it would target flat growth and profits after weakness in major markets hit its business, sending the shares plunging 15% lower to 775p.
House builder Persimmon (PSN) said that chief executive David Jenkinson will be stepping down ‘in due course’ after spending 23 years at the company. Full-year results to 31 December saw revenues down 2.4% to £3.65bn and pre-tax profit flat at £1bn. The shares fell 3.7% to £29.6.
The company also said it planned to raise £500m to 'reset' the business via a deeply-discounted rights issue, heaping more pain on shareholders.
Finally the company announced that Mark Wilson would step down as chief financial officer by 30 April.
Total cigarette and tobacco heating products (THP) volume declined 4.4% to 677bn sticks, with cigarette volume down 4.7% and THP volume up 31.6%.
Hikma, which makes and markets a broad range of branded and non-branded generic medicines, was helped by newer launches in the US, its biggest market.
Health and hygiene company Reckitt Benckiser (RB.) reported full-year revenues up 0.8% on a like-for-like basis to £12.8bn, lower than management guidance as it suffered from a slowdown in demand for over-the-counter medicines in the US. The shares fell 3% to £58.90.
Pest control firm Rentokil Initial (RTO) reported full-year revenues up 9.9% to £2.6bn and operating profit up 10.5% to £368m. The company expects only a small impact from the coronavirus outbreak. The shares inched down 0.2% to 494p.
Packaging company Mondi (MNDI) said challenging conditions resulted in a 3% fall in full-year revenues to £7.3bn and flat pre-tax profit of £1.1bn. The company said heightened macro-economic uncertainty was likely to affect its markets in the short-term. The shares fell 0.7% to £16.1.