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London markets open up despite UK lockdown measures being extended

London markets opened up today after two days of falls despite further fears over the economic impact of the coronavirus as the Government prepares to extend the lockdown for three more weeks.

The FTSE 100 index of Britain’s leading companies rose by 60 points or 1.07 per cent to 5,658 in today’s first minutes of trading, following two days of losses.

It comes as the UK lockdown is set to be extended today until at least May 7, despite fresh warnings about the long-term impact on the economy. 

A report from the Resolution Foundation think-tank suggests the economy could return to near-normal levels relatively fast if the lockdown lasts three months.

PAST FORTNIGHT: The FTSE 100 index has been swinging up and down in the past two weeks

PAST FORTNIGHT: The FTSE 100 index has been swinging up and down in the past two weeks

PAST FORTNIGHT: The FTSE 100 index has been swinging up and down in the past two weeks

This scenario would see GDP perhaps just 3 per cent lower in the medium-term. But a six-month lockdown could result in unemployment hitting five million.

Asian markets fell today after overnight woes on Wall Street as more negative US economic data fuelled worries about the full impact of the pandemic.

There had already been a spate of grim economic forecasts this week, with the International Monetary Fund warning of the worst global downturn in a century.

The woes on Wall Street discouraged traders in Asia, where Tokyo was down 1.2 per cent, Hong Kong lost 0.8 per cent and Sydney dropped 1.4 per cent.

A trader walks by a screen showing the Korea Composite Stock Price Index in Seoul today

A trader walks by a screen showing the Korea Composite Stock Price Index in Seoul today

A trader walks by a screen showing the Korea Composite Stock Price Index in Seoul today

Yesterday, the FTSE closed down by 194 points or 3.34 per cent at 5,598. In the US, the Dow Jones in New York ended down 445 points or 1.86 per cent at 23,504.

Poor US economic figures released yesterday spooked investors further, casting more light on the damage unleashed by lockdowns and social distancing measures.

It comes as companies in Britain face going bust within days as only £8.7billion of the £330billion promised in emergency loans has gone out the door.

Four weeks ago Chancellor Rishi Sunak announced two bailout schemes to boost lending to large and small businesses. But figures yesterday showed just 2.6 per cent of the money available has actually been loaned by banks. 

Meanwhile, the Treasury extended the cut-off date for the Coronavirus Job Retention Scheme so employers can claim for furloughed employees who were on their payroll on or before March 19.

US retail sales plunged in March while industrial production in the same month suffered its steepest drop since 1946, data showed yesterday.

Reports pointed to weak homebuilder sentiment and manufacturing conditions, while a Federal Reserve report said US economic activity ‘contracted sharply’.

Ann Miletti of Wells Fargo Asset Management said: ‘The economic data was nothing short of disastrous. How long can you sustain the shutdown is what’s on investors’ minds.’

A man walks past digital market boards at the Australian Stock Exchange in Sydney today

A man walks past digital market boards at the Australian Stock Exchange in Sydney today

A man walks past digital market boards at the Australian Stock Exchange in Sydney today

President Donald Trump has said that he will today announce the first plans for lifting lockdowns after the US – the worst-hit country – passes the ‘peak on new cases’.

But the World Health Organisation has warned that lifting restrictions too early could have devastating consequences, with fears of a possible second wave of infections.

There was bad news on oil markets too, with the International Energy Agency warning that 2020 was likely to be ‘the worst year in the history’ of the sector.

Oil has plummeted in recent weeks as lockdowns depressed demand, and the crisis was made worse by a pricing war between top producers Saudi Arabia and Russia.

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