BRUSSELS/FRANKFURT/PARIS (dpa-AFX) - U.K. stocks plunged on Friday to extend losses from the previous session as new coronavirus outbreaks in Asia, Europe and the Middle East sparked fears of a global pandemic.
The head of the World Health Organization warned the deadly epidemic was now at a 'decisive point' and has the potential to become a pandemic.
As the virus spreads rapidly around the world, investors fear that there could be a global recession this year.
The British economy, which relies to a large extent on tourism revenues and manufacturing, is already seeing the impact, the outgoing Bank of England governor Mark Carney told Sky News.
Meanwhile, the U.K. has warned the EU it will walk away from negotiations for a new free trade agreement if significant progress is not made by June.
The benchmark FTSE 100 was down 262 points, or 3.84 percent, at 6.534 after falling as much as 3.5 percent on Thursday.
British Airways parent IAG lost 7.6 percent after warning the coronavirus outbreak will hit its earnings.
easyJet lost 4.3 percent after announcing cancellation of some flights and launching cost-cutting measures amid a significant softening of demand.
Aerospace engineer Rolls Royce Holdings surged 4.4 percent after its full-year pre-tax loss narrowed from last year.
Building materials supplier CRH declined 3.3 percent despite reporting 2019 earnings ahead of guidance.
London Stock Exchange Group fell 2.5 percent after delivering mixed earnings results.
In economic releases. U.K. house price inflation was the highest in 18 months in February, survey data from the Nationwide Building Society showed.
The house price index rose 2.3 percent year-on-year after a 1.9 percent increase in January. The figure was in line with economists' expectations.
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