LONDON: London’s FTSE 100 broke a four-session losing run on Tuesday after Prime Minister Boris Johnson introduced restrictions to curb a resurgence in Covid-19 cases in Britain without resorting to another full-blown lockdown.
Johnson urged citizens to work from home where possible and ordered bars and restaurants to close early, with the new restrictions likely to last six months. He warned more could come if these prove insufficient.
After losing almost 5% over the last four sessions, the FTSE 100 jumped as much as 1.2% after the announcement, before closing 0.4% higher.
It had marked its worst day in over three months on Monday on news that Johnson was considering another lockdown, one the economy can ill-afford, following scientific warnings that deaths in Britain could soar without urgent action.
Internationally focused firms on the blue-chip index benefited further from a slide in the pound.
The mid-cap index had reversed early losses to gain up to 0.5%, but was back in the red as insurers slumped.
Beazley dropped 14.1% on a likely doubling in claims, while other insurers were hit after Britain’s Financial Conduct Authority proposed stopping insurers from charging existing car and home insurance customers more than new ones.
Meanwhile, home improvements retailer Kingfisher topped the FTSE 100 after it reported a 23% jump in first half profit, while payments processor Network International surged 25% after.
“The rhetoric of Boris Johnson (on Monday) was a lot worse than what the measures are,” said Michael Baker, analyst at ETX Capital in London. “The measures declared are a lot less crippling that than a full-scale lockdown.”
“Any sort of (market) moves now are going to be purely based on how the government reacts to the virus rather than what the virus is actually doing,” he added.
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