Coronavirus: Fear returns to stock markets

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Global stock markets have fallen sharply as investors continue to worry about the broader economic effects of the coronavirus.

London’s FTSE 100 share index fell more than 3% and there were similar declines in other European markets.

Earlier on Friday, markets in Asia had seen big falls, with Japan’s Nikkei share index dropping by 2.7%.

On Thursday, US share markets recorded steep declines, with all three main indexes down by more than 3%.

In London, shares in travel companies saw some of the steepest falls once again. Shares in cruise operator Carnival fell 4.2% to hit its lowest price since 2012.

Other big losers in the sector included EasyJet, Tui and British Airways owner IAG, which each fell more than 4%.

The drop wipes out previous gains for the week on the FTSE 100, which includes international firms such as Shell and Unilever as well as big British brands.

Only a handful of companies on the FTSE 100 saw gains, but they included two supermarkets: Tesco and Morrisons.

Banks were another group that took a battering, as investors anticipate that interest rates might be cut in order to make borrowing cheaper for companies and consumers to keep the economy buoyant.

Oil prices also fell, declining 2% as investors worried that Russia may not agree to a cut in production that other members of the Opec oil producers’ cartel, are keen to see.

The price of oil has fallen by about a quarter since the coronavirus began to spread internationally, with demand for fuel expected to decline.

Brent crude was down 2.4%, at $48.79 per barrel on Friday, while US West Texas Intermediate was 2.1% lower at $44.90 per barrel.

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