The FTSE 100 looks set to open its weekly account in negative territory amid heightened hostilities between America and China over the origins of the coronavirus.
Comments from US secretary of state Mike Pompeo that he has seen evidence the outbreak emanated from a facility in Wuhan have ramped up the tension levels.
“There's enormous evidence that that's where this began. We've said from the beginning that this was a virus that originated in Wuhan, China,” Pompeo told American TV.
“We took a lot of grief for that from the outset. But I think the whole world can see now. Remember, China has a history of infecting the world, and they have a history of running substandard laboratories,” he added.
President Trump hinted at potential sanctions as a result of what has been seen as a lack of transparency in the part of the Peoples Republic.
“Having only recently signed a trade deal with China, just prior to the outbreak of the current pandemic, he caught the markets a little off guard by comments that raised the prospect of raising new tariffs against them on the premise that the virus was their fault, and that they sought to spread it on purpose, or at the very least did little to halt its spread,” said Michael Hewson of CMC Markets.
On the oil market, American crude was once again under pressure with West Texas Intermediate down almost 6% at US$18.63 on worries over the deteriorating economic outlook.
Here in the UK it looks likely to be another busy week for scheduled corporate news with BT (LON:BT.A) set to update the market amid reports that it intends to slash the dividend.
Around the markets: Sterling US$1.2449 (flat); gold US$1,707.30 an ounce (up 0.4%); Brent crude US$26.21 a barrel (off 0.9%)