MARKET REPORT: Global stocks plunge on fresh US jobless fears 

Markets were downbeat after a slew of figures laid bare the challenge facing governments as they try to revive their economies.

In the US, another 2.4m people applied for unemployment benefits last week.

This means that 38.6m Americans have made first-time applications for state assistance over the last nine weeks, when the effects of the coronavirus pandemic began to be felt.

The rise was in line with estimates – but still bodes ill for May unemployment figures.

A man walks past closed business in New York, yesterday. Latest statistics reveal 39 million people have applied for unemployment benefits in the last two months in the US

These will almost certainly rise from the 14.7 per cent jobless rate registered in April.

The news knocked US bourses into the red, with the Dow Jones Industrial Average, S&P 500 and Nasdaq falling between 0.6 per cent and 1 per cent.

In Japan, exports fell the most since the global financial crisis in April. The pandemic hit demand for cars and industrial materials especially hard.

And back in the UK, data showed manufacturing output fell to its lowest on record – since comparable records began in 1975 – during the three months to May.

Lockdown closures mean the UK production numbers were not exactly a surprise.

But it says a lot about the times that the FTSE 100 fell by just 0.9 per cent, or 51.91 points, to 6015.25, while the FTSE 250 eked out a gain of 0.1 per cent, or 18.48 points, to 16385.96.

Stock Watch – Belvoir 

Trading at estate and lettings agent Belvoir held up much better than the company expected in April.

The AIM-listed property franchise said fewer than 5 per cent of tenants were in arrears, compared with 2 per cent normally, which was ‘considerably less’ than it had estimated.

Offices are open again and it believes there is pent-up demand from people who are looking to move. 

Shares jumped 6.1 per cent, or 7.5p, to 130p on the update, released ahead of its annual meeting.

Product testing specialist Intertek prevented the Footsie making a more pronounced drop.

Its stock rose 6.1 per cent, or 300p, to 5238p after it pledged to hand back £115million to shareholders via a final dividend of 71.6p per share.

The commitment bucks a recent trend that has seen almost half of Footsie firms cut, cancel or defer their payouts to a later data as they shore up their finances – and it comes despite Intertek’s sales falling 4.6 per cent to £882million in the first four months of the year.

Airline and travel stocks also made gains, sweeping higher after Easyjet (up 4.4 per cent, or 24.4p, to 574.8p) unveiled plans to restart flights across the UK and France next month.

British Airways-owner IAG rallied 3.7per cent, or 7.25p, to 206.1p, embattled cruise operator Carnival climbed 1.6 per cent, or 15.6p, to 979.6p, and aeroplane engine supplier Rolls-Royce adding another 3.5 per cent, or 9.6p, to 283.3p, a day after it announced thousands of new job cuts.

Over on AIM, investors were cheering Jet2-owner Dart Group (up 17.7 per cent, or 102p, to 678.5p) after it raised £172million through selling almost 30m shares. 

This will help guide it through the crisis, and it is also eligible to receive up to £300million through government lending.

Elsewhere in the aviation sector, Southend Airport-owner Stobart Group has agreed to sell two brand names – Eddie Stobart and Stobart – to the Eddie Stobart lorry company for £10million.

The trucking company bought the rights to its own name in an attempt to end confusion about its ownership. Under the current arrangement, the haulier pays a fee to use the name.

Eddie Stobart was spun out of Stobart Group several years ago, but the groups are now entirely separate. Stobart Group will now have until February to rename itself. Shares in London-listed Stobart Group lifted 4.9 per cent, or 2.2p, to 47p. AIM-listed Eddie Stobart rose 9.6 per cent, or 0.7p, to 8p.

Elsewhere, small-cap oil group Enquest surged after it said still thinks it will produce the same amount of oil this year despite the recent price rout.

It pumped out 65,938 barrels a day on average during the first four months of the year, slightly more than the 57,000-63,000 it had told investors to expect. Shares rose 12.4 per cent, or 1.42p, to 12.92p.

Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.