FTSE 100 reverses course to end lower on Imperial slump

(Reuters) - London’s FTSE 100 handed back earlier gains to record losses on Thursday as a 7.3% fall in tobacco giant Imperial Brands overshadowed a 10% leap in medical products maker Smith+Nephew.

FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville/File Photo

The blue-chip index .FTSE slipped 0.3% as Imperial Brands IMB.L tumbled on ex-dividend trading, while most other sectors also traded in the red with a surge in coronavirus infections in South Korea stoking fears about a deepening health crisis.

Smith+Nephew SN.L hit an all-time high and helped limit losses on the index after the medical products maker forecast another year of revenue growth.

The FTSE 250 midcap index .FTMC ended the day with a 0.1% rise, led by a 19% surge in price comparison website MONY.L following upbeat outlook and a 7% jump in engineering firm Spectris SXS.L after 2019 results.

For the most part, the British indexes have drawn support this week from stimulus measures from China, which cut its benchmark lending rate to cushion the impact of the coronavirus epidemic.

Both indexes are headed for a week of gains.

“Investors are making a number of significant assumptions that governments and central banks will be able to mitigate the effects of any disruption in the short and medium term,” CMC Markets analyst Michael Hewson said.

“Time will tell whether that is a safe assumption to make, however in the absence of anywhere else to put one’s money, the line of least resistance for now appears to be to buy stocks.”

Among other notable gainers on the main index were defence firm BAE Systems BAES.L and lender Lloyds LLOY.L with gains of 3% and 1.4%, respectively, after their annual results.

However, the FTSE 100's losses were deepened by 1%-1.7% falls in GlaxoSmithKline GSK.L and Unilever ULVR.L, whose stocks also traded without dividend entitlement.

Small-cap bathroom and kitchen products supplier Norcros NXR.L slid 11% after it warned annual profit would miss market expectations and supply chain disruptions due to the coronavirus outbreak would likely hit performance.

Reporting by Shashwat Awasthi in Bengaluru; Editing by Shounak Dasgupta, Saumyadeb Chakrabarty and Alison Williams