StockMarketWire.com - After more heavy losses at the opening bell for US markets, the UK's FTSE ended one of its worst weeks in years in a sea of red as the COVID-19 outbreak escalates, sparking widespread investor panic selling.

At the close, the benchmark FTSE 100 had plunged another 3.7% at 6,544.41 led by airlines and holiday firms, although popular high growth investment trust Scottish Mortgage was also under the cosh, off more than 6% at a 2020 low of 549p.

At the beginning of trading on Friday across the pond, the S&P 500 index lurched 3.3% lower, with the technology heavy Nasdaq losing 2.8%. Asian markets have been in freefall, with China's CSI 300, Japan's Nikkei and Korea's Kospi indexes all significantly down.

Today's move in the FTSE comes after a 3.5% decline yesterday and takes losses for the week to nearly 900 points, or roughly 12%.

Meanwhile, Brent crude prices continued to fall, losing another near-4% to $50.22, but gold prices stayed flat at $1,646.6/oz after hitting seven-year highs this week.

The pound lost earlier gains to lose more ground against the dollar, euro and yen.

STOCKS SEA OF RED

In company news, British Airways-owner International Consolidated Airlines slumped nearly 10% to 465.8p after reporting a 5.7% drop in operating profit to €3.285bn euros last year, slightly above its previous forecast. It also warned that weak demand due to the coronavirus outbreak would lead to further flight cancellations on its Asian and European routes this quarter.

Outgoing chief executive Willie Walsh, who hands over the controls next month to Luis Gallego, current head of IAG's Iberia subsidiary, attempted to reassure investors that the group was 'resilient with a strong balance sheet and substantial cash liquidity to withstand the current weakness.

'We have a management team experienced in similar situations and have demonstrated that we can respond quickly to changing market conditions. We are strongly positioned for the expected recovery in demand,' added Walsh.

Budget airline EasyJet lost earlier gains to end the day around 1% in the red at £11.005 after admitting that it had seen 'a significant softening of demand and load factors into and out of our Northern Italian bases' due to the coronavirus outbreak as well as 'slower demand across our other European markets.'

The company said it was too early to forecast the impact of the virus on its full year results but that it would continue to reduce costs, including postponing 'non-critical project and capital expenditure' in order to protect earnings as best it could.

UK travel company On The Beach (OTB) warned that it won't reach market expectations this financial year because of the coronavirus outbreak in a mid-afternoon statement.

The firm said it had seen a 'small but noticeable reduction in demand' for summer holiday bookings, but that trend had 'accelerated as the coronavirus outbreak spread throughout Europe.'

The stock held up surprisingly well, sliding around 3% to 321.6p, although investors were clearly anticipating the warning, based on the stock's 25% crash this week.

On a positive note, aero-engineer Rolls-Royce reported a massive cut to full year losses and a 25% increase in underlying operating profit thanks to a marked pick-up in business in the second half.

As well as a strong civil aerospace aftermarket the firm saw record orders in its defence business, and power systems saw a recovery in orders in the fourth quarter.

Rolls-Royce shares rallied close on 4% to 623.4p, one of the few FTSE 100 risers in a scarce day for positives.

REFINITIV PROBE DRAG

The London Stock Exchange (LSE) also reported strong results for the year to 31 December 2019 with revenues up 8% to £2.056bn and adjusted operating profits up 14% to £1.065m.

Chief executive David Schwimmer focused on the upside potential of his deal to buy Refinitiv given the 'highly complementary capabilities in data, analytics and capital markets as well as deep customer relationships across a global business.'

But regulators in Europe have yet to fully approve the deal. LSE shares gave up more than 4% by the close to £74.80.

Trading platform Plus500 rallied more than 9% to 953.6p after it revealed that it had seen a 'significant increase in levels of customer trading activity' in recent weeks, meaning its first quarter financial performance was 'trending substantially ahead of the last quarter of 2019.'

The company cautioned that it was too early to quantify the impact of the first quarter on its full year results, given that elevated volatility in markets might not continue, and it was still weighing the potential impact of regulatory changes in Australia.

Premier Inn hotels chain-owner Whitbread slumped dropped 5.5% to £38.53 as it completed the acquisition 19 hotels in Germany from Foremost Hospitality, for an undisclosed sum.

Defence and aerospace engineer Meggitt also reversed around 4% at 534.6p, despite winning a $73m contract from Bell Textron for the supply of ice protection components to the V-22 Osprey military aircraft.

Industrial chains and power transmission equipment group Renold slumped nearly 13% to 11p after warning that the coronavirus outbreak would chop £1m from its annual operating profit.

Luxury furniture group Walker Greenbank dropped 2% to 72p, even as it announced that its Clarke & Clarke brand was collaborating with TV personality Tess Daly on her homewares collection.


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