London stocks struggle for traction as coronavirus dominates investor concerns

London stock markets struggled for traction on Wednesday as investors kept a close eye on coronavirus contagion, specifically across Europe and the U.K. Gains for heavily weighted HSBC Holdings PLC helped support the index.

The FTSE 100 index UKX, -0.04% was flat at 7,014.44 after Tuesday’s global equity rout, which left it with a nearly 2% loss. The U.K. index is down more than 5% for the week thus far, which if it continues, would be the worst weekly decline since August 2015. The pound GBPUSD, -0.6306% slid 0.6% against the dollar, as investors sought out the U.S. greenback as a haven move.

Tuesday’s global selloff that wiped nearly 2,000 points off the Dow industrials came after the Centers for Disease Control and Prevention warned Americans to prepare for outbreaks. But adding some support for the rest of the globe, major U.S. indexes opened firmly in the green on Wednesday.

Europe has been grappling with an outbreak in Italy that has led to reported infections in Germany, France Spain, while South Korea and Iran have seen climbing case numbers.

That’s as the cost of the outbreak showed up for corporations again on Wednesday, with drinks maker Diageo DGE, -1.18% warning that the virus could hit profits by up to 200 million pounds ($258 million) in 2020. Shares of Diageo lost 1.8%.

Shares of Taylor Wimpey TW, -3.24% tumbled 4.3% after the house builder reported a rise in pretax profit, but said higher costs caused its operating profit to dip to 19.6%. “A mixture of higher building costs and not much house price growth impacted the group, and the outlook for the business isn’t too hot,” said David Madden, market analyst at CMC Markets.

William Hill shares WMH, -2.21% slid over 4% after the bookmaker posted a 37% fall in full-year operating profit.

On the upside, shares of HSBC Holdings PLC HSBA, +2.32%HSBA, +2.32% jumped 2.8%.

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