Markets rise as UK is locked down

FTSE100 and S&P both up as markets continue to react to social measures, rather than monetary policy

Article updated: 24 March 2020 11:00am Author: Joe Healey

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  • FTSE 100 is currently up roughly 3.7% and the S&P is pointing to roughly a 4.5% higher open
  • The primary data markets are reacting to is the number of new cases and deaths, rather than monetary and fiscal policy
  • If the UK public react as they should we may start to see the curve flatten, which should provide markets the solid floor they are so desperately craving

Markets rebounded in early trading today following last night’s announcement of an effective UK lockdown, something most UK policymakers have been pushing for the last week as the nation tries to reduce the spread of the virus. For the last few weeks we have said the primary data markets are reacting to is the number of new cases and deaths, rather than monetary and fiscal policy. This highlights our view that some investors are starting to see light at the end of the tunnel. Of course, there remains uncertainty ahead but it seems we are starting to take steps in the right direction for the UK economy.

All of this is also coming alongside yesterday’s announcement that the Fed ‘is willing to do whatever it takes’, something that helped prop up Asian markets earlier today. News that Hubei, the epicentre of the outbreak, has started to relax travel restrictions could be a key milestone in the virus saga for either good or for worse.

Taking this see-saw view off the table, from a broad perspective it’s clear some optimism is being priced back in. Despite the continuing spread of the virus, the FTSE 100 is currently up roughly 3.7% and the S&P is pointing to roughly a 4.5% higher open. What is also important to note is this is now not just the Government’s priority but society’s priority. If the UK public react as they should we may start to see the curve flatten, which should provide markets the solid floor they are so desperately craving. This is the key catalyst for markets to start their recovery after what has been one of the greatest shocks of this generation.


All information given including prices, yields and our opinion is correct at the time of publication. Our opinions on investments can change at any time and for our latest view please go to www.share.com. To understand how our Investment research team arrive at their views please read our Investment Research Policy.

Joe Healey

Investment Research Analyst

Following his completion of the graduate scheme, Joe is an Investment Research Analyst covering equities. He holds a BA Hons Business Management degree and is currently studying towards CFA Level II after passing CFA Level I in June 2019.

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