London stocks fall as new pandemic curbs threaten rebound; Cineworld slumps

UK shares dropped on Thursday as new curbs to stem the spread of COVID-19 threatened to derail a rebound in economic activity, while cinema operator Cineworld tumbled after warning it may need to raise funds to weather the crisis.

The FTSE 100 index fell 0.6pc, with travel and leisure stocks being the biggest drags on the index due to fresh measures on movement and social gathering.

"Markets are being a little risk averse as there is a lot of uncertainty around fresh stimulus measures, which are required right now as an economic shock absorber in addition to rising uncertainties over the management of the coronavirus crisis," said Michael Hewson, an analyst at CMC Markets.

All eyes were on British Finance Minister Rishi Sunak's speech later in the day on his new plans to support jobs.

The Times newspaper reported that he is expected to announce an extension of the VAT sales tax cut for the hospitality and tourism industry through to the end of March.

The mid-cap index lost 0.6pc, with Cineworld tumbling 13.6pc - set to record its biggest single-day fall in nearly five months, as it swung to a first-half loss and flagged risks to its ability to continue as a "going concern".

British-listed shares of Ryanair slipped 1.0pc after Chief Executive Michael O'Leary said the company said it will put unneeded British staff on unpaid leave if the UK government does not provide a "proper" furlough scheme.

Pub owner Mitchells & Butlers fell 1.5pc after it said total sales for the 51 weeks ended Sept. 19 dropped 35pc due to store closures and a sharp slump in demand amid widespread restrictions.