FTSE 100 and sterling slump amid UK Covid-19 freight blockade – as it happened

Rolling live coverage as lorry drivers banned from France because of new coronavirus strain and US agrees stimulus package

• Ban for 48 hours on all accompanied freight in major supply chain blow
• Food bosses: Don't stockpile; UK has plenty of food
• Brexit talks miss another deadline, leaving 10 days to go
• US to give $600 to individuals in $900bn stimulus effort
• Shell writes off $3.5bn amid steep oil price falls

3.07pm GMT

Sentiment on global markets has been dominated today by the news from the UK that the new coronavirus strain is more transmissible than previous versions - although not thought so far to be any more deadly.

For British would-be travellers and transport companies the news and subsequent restrictions were a blow, but the subsequent ban on all human travel from the UK to France, including lorry drivers, has prompted the first major test of the UK's no-deal Brexit plans, with queues of lorries on the M20 motorway in Kent.

Related: UK in Covid freight ban talks with France as Cobra set to meet over crisis

Access to the Ferry Terminal at the Port of Dover is still suspended to all accompanied traffic leaving the UK until further notice

Related: Coronavirus live news: Spain joins countries banning flights from UK as Boris Johnson holds crisis talks

2.37pm GMT

Investors in US companies have responded to concerns about the new strain of the virus by selling their stocks, mirroring European markets.

U.S. markets open lowerhttps://t.co/QKV2SoRZ4B pic.twitter.com/37U8hp4FF5

The Dow Jones Industrial Average fell 20.05 points, or 0.07%, at the open to 30,159. The S&P 500 opened lower by 25.13 points, or 0.68%, at 3,684.28. The Nasdaq Composite dropped 159.49 points, or 1.25%, to 12,596.14 at the opening bell.

2.26pm GMT

Five minutes to go until the Wall Street opening bell, and futures are showing that it will be a steep selloff - although not quite as dramatic as earlier moves suggested.

The S&P 500 is expected to drop by 1.4%, while the Dow Jones industrial average and the Nasdaq are both pegged for a 1% decline.

2.17pm GMT

Some more detail on the 23m Evans sale: hundreds of jobs are at risk across the country in its various outlets, writes the Guardian's Sarah Butler:

Buyer City Chic Collective plans to operate Evans, which made sales of 26m online and via wholesale last year, as an online-only brand. That will mean the closure of more than 100 Evans concessions and outlets within other Arcadia stores as well as its five standalone shops. The concessions and other outlets will not close immediately but hundreds of jobs are at risk at those outlets.

Arcadia, which employs 13,000 people at about 500 outlets, collapsed into administration last month as high street lockdowns prompted by the coronavirus pandemic piled on pressure after years of flagging sales amid heavy competition from rivals such as Boohoo and Primark.

Related: Evans saved from Arcadia collapse but five stores will close

1.54pm GMT

A note for central bank/regulation watchers: the former chief executive of Barclays is among three banking insiders appointed to the Bank of England's prudential regulation committee by chancellor Rishi Sunak.

1.39pm GMT

The prime minister's spokesman has repeated requests from the food industry for people to refrain from panic buying. The UK has resilient supply chains and people should shop normally, the spokesman said.

The government is in close contact with France to get freight traffic moving again, the spokesman said.

1.29pm GMT

The FTSE 100 has lost more ground once more: the index is down by 2.6%. It's also notable that the mid-cap FTSE 250 index has lost 2.9%.

Across Europe the Stoxx 600 index has lost 2.7%.

12.39pm GMT

Today is something of a red-letter day for Tesla, the US electric car pioneer, as it belatedly joins the S&P 500 index.

12.21pm GMT

The selloff in the UK has abated somewhat, after the French government indicated that it was looking at ways to restart the movement of hauliers across the Channel.

BREAKING: French government says that it will establish a protocol in the next few hours to ensure that movement from the UK can resume".

11.55am GMT

Stena Line Group, one of the ferry companies that transports freight across the Irish Sea, is moving one of its ships that regularly serves Belfast port to a French-Irish route instead.

The new route from Rosslare in the south of the Republic of Ireland to Cherbourg in northern France will allow some freight to avoid the UK, amid significant uncertainty over what the rules governing trade and customs will be on 1 January - not to mention the new restrictions on travel between the UK and many other nations.

Update for Irish Sea freight customers: the Stena Foreteller is being moved into position to commence on the Rosslare to Cherbourg route. We will now have two ships departing tomorrow direct to France. Please contact our freight team for bookings. https://t.co/UJKkQHQTzs pic.twitter.com/UG9LIOpMRd

11.50am GMT

It looks like investors looking at the US are gearing up to sell the fact of the stimulus package being agreed, after buying the rumour. In layman's terms that means that US stock markets are on course for a heavy drop when they open in a few hours.

Stock market futures for the S&P 500 suggest the US benchmark will lose 2.2%. The Dow Jones industrial average is pegged down by 1.9%, while the Nasdaq (whose tech stocks provide a fairly good hedge against further coronavirus restrictions) is looking like a 1.4% decline is likely.

Something else has happened.$VIX pic.twitter.com/RVM9ctyb25

11.26am GMT

Plus-size brand Evans has been rescued from administration in a 23m deal but will close all five standalone stores with the loss of 25 jobs.

11.13am GMT

UK retailers reported stable sales in the run-up to Christmas, but they anticipated a bleak January even before large parts of the country were effectively put back into lockdown, according to the closely followed distributive trades survey from the Confederation of British Industry (CBI).

The new year looks set for an unpromising start, with retailers anticipating a sharp fall in sales in January. An expected deterioration in the labour market will likely weigh on household spending, even assuming the roll-out of Covid-19 vaccines paves the way for a gradual lifting of restrictions as the year progresses.

Government support measures, such as business rates relief and the extended furlough scheme, have been immensely helpful for retailers. To assist with planning, a priority now should be to avoid any sudden cliff-edges as schemes are wound down.

11.02am GMT

Deutsche Post DHL, the German delivery company, has said it will halt deliveries of parcels to Britain and Ireland for business and private customers because of new transport restrictions.

10.54am GMT

Sterling is down by 2.2% this morning - or about $3 - at $1.3212.

It briefly dipped below the $1.32 mark, last hit 10 days ago, a few minutes before. That represented 2.5% decline, and the biggest one-day drop since March, when there was a global rush for dollars.

10.41am GMT

Here is the performance of the FTSE 100 this morning. You can just about see the steep drop at the opening bell on the left-hand side, but in recent minutes there has been another rapid selloff:

10.32am GMT

The FTSE 100 selloff has accelerated again, with the index down by 2.9%, a 190-point decline.

The sterling selloff has also sped up: the pound is now 2.4% weaker against the US dollar.

10.22am GMT

The transport workers' union has called for emergency help for the workers and companies affected by the blockage at UK ports, after all accompanied travel between the UK and France was banned.

RMT (the National Union of Rail, Maritime and Transport Workers) said it was seeking urgent talks with the government over the crisis.

Thousands of workers on Eurostar, on the ferries and at our ports have been caught in the crossfire of the border crisis that has developed overnight and escalated this morning.

RMT is calling for an urgent package of government support and protection for the staff and services impacted by the decision to suspend operations.

10.12am GMT

UK consumers should not stockpile food and there are currently no shortages, according to the boss of the lobby group for fresh food transporters.

However, Shane Brennan, chief executive of the Cold Chain Federation, said a deal to allow goods transport between the UK and France is urgently needed.

This decision will impact first and foremost on hundreds of drivers, who are either on the road or are supposed to set out in the coming days to carry goods to people in the UK and across the EU. This will cause them, their families, and their employers great anxiety as they will have no idea when or how they will get home. We urge the authorities on all sides to consider their welfare above all else in the hours ahead.

We must also remember that the UK has a resilient and diverse food supply chain, we are operating at our peak trading period with well stocked supermarkets and supply chains full of all the products people need for Christmas. We urge consumers to trust in the professionals working across the cold chain to do their job. They have proved they can do this every day through Covid.

10.03am GMT

And sticking to that theme for a second: oil prices have also taken a hit thanks to the uncertainty around the new coronavirus strain in the UK.

The price of Brent crude oil futures, the North Sea benchmark, fell by 4.8% on Monday morning, back to $49.82 per barrel, undoing the gains of the last week. That represented a $2.40 drop.

9.54am GMT

Royal Dutch Shell has warned its shareholders that there is more financial pain to come as 2020 comes to a bitter end for the oil industry.

9.30am GMT

The supermarket Sainsbury's has said the UK could soon face shortages of some fresh produce if the ports situation does not improve - but supplies for Christmas meals are already in stock.

9.21am GMT

It looks like the FTSE 100 selloff is settling somewhat, after a frenetic first hour of trading.

London's blue-chips have now only lost 1.1% today, a 75-point decline - albeit still a steep slump for the Monday before Christmas.

9.09am GMT

In case you were in any doubt as to the unusual situation, here's another sign: the UK's two-year government debt has just hit a record low yield, deeper than ever before into negative territory.

The yield decline was driven by investors snapping up government debt as a safe haven to protect against declines suffered in riskier assets - which this morning includes UK equities. Bond yields move inversely to price, so falling yields mean higher demand.

8.55am GMT

Prime Minister Boris Johnson is due to chair a meeting of Cobra, the emergency committee, this morning, to discuss the ports disruption.

In the meantime, police have closed four junctions of the M20 in Kent to queue up lorries that have tried to go to Dover under Operation Stack. The Brexit contingency lorry park is not ready yet, so all of that traffic that might have expected to cross the Channel will have to park on the side of the motorway.

UPDATE
OP STACK, M20, J8-J12 Coast bound.
The M20 is now closed between J8-J12 Coast bound due to Operation Stack being implemented. @Port_of_Dover/@TruckShuttle/@LeShuttle are closed due to travel restrictions leaving the UK: https://t.co/omAnTp9wdJ #OpStack #OperationStack pic.twitter.com/gjBOUNjR2M

8.47am GMT

Let's get some reaction from economists and traders as to what the new strain of the virus means for the economy.

Lee Hardman, a London-based currency analyst at MUFG Bank, said the increased ease with which the new strain is transmitted poses a serious challenge to government's costly strategy to contain the spread of Covid." He said:

It will increase pressure on the government to roll out vaccines to the old and vulnerable more quickly in a race against time. The new tougher restrictions will likely have to remain place until there has been greater vaccine rollout which could take months. At the current juncture, we are working on the assumption that vaccines will still prove effective against the new strain but it is not yet clear. As a result, the economic slowdown willprove deeper and extend further into nextyear. It will dampen optimism over a stronger economic recovery in 2021.

With some cases also being reported outside of the UK and with several countries suffering fresh spikes in cases and resorting to further lockdowns, the stark reminder is that until the vaccine rollout reaches a sufficient level, little can be done to defeat the virus.

Much of Europe has become cut off from the UK, following details of a new strain of the virus. The near-term economic effects of this are, perhaps, limited - inventories tend to be high at this time of the year, and the UK has imposed more restrictions on activity. However, this does signal a relatively high degree of fear, and it is fear of the virus that does the most economic damage.

8.30am GMT

Bucking the trend on London's stock market this morning is Metro Bank, which gained as much as 22% (before moderating to a 7.8% gain) after investors priced in Friday's announcement of a 3bn mortgage book sale to NatWest Group, the old RBS.

Also on the up are gold miners - a safe haven in times of trouble - such as Fresnillo, up 5% this morning. The yellow metal itself has gained 0.9% today to about $1,896 per troy ounce.

8.21am GMT

In Europe it's travel and transport stocks that are also bearing the brunt of losses.

In Germany the Dax has lost 1.9%, while France's Cac 40 is down 2.4% and Spain's Ibex has lost 2.8%.

8.15am GMT

It is looking like a pretty brutal selloff for the travel industry this morning, after a stream of nations banned people from the UK.

British Airways owner International Airlines Group is the biggest faller on the FTSE 100, down 16%, while jet engine manufacturer and maintainer Rolls-Royce is down 9%.

8.03am GMT

London's blue-chip stock index, the FTSE 100, has lost 1.8% in early trading, or 117 points, to hit 6,410 points.

The heavy losses come with Brexit talks in limbo, a ban on accompanied freight to France, and the emergence of a new strain of the coronavirus that the government spreads more easily, although with no observed effect on its deadliness.

8.00am GMT

Grant Shapps, the UK's transport secretary, has this morning insisted the UK will not ask to extend the Brexit transition period, despite chaos at UK ports and a new phase in the coronavirus crisis.

However, there will be significant disruption" at Dover, he said on the morning broadcast round, via Reuters.

7.39am GMT

Good morning, and welcome to our live, rolling coverage of business, economics and financial markets.

It was certainly an eventful weekend. In the US political leaders finally agreed another round of fiscal stimulus measures, but the UK has endured arguably more dramatic events: the cancellation of Christmas bubbling plans, followed by the temporary ban from many countries on travellers from the UK.

Related: Covid chaos disrupts Kent ports as France bans UK freight

Operation Stack is now being implemented between Junctions 8 and 11 of the M20 coastbound carriageway following the closures of the Port of Dover and Channel Tunnel. Keep following us and @HighwaysSEAST for updates.

Sterling hit by further lockdown and Brexit talks.#GBPUSD 1.3358 -1.27%#EURGBP 0.9124 +0.7%#GBPJPY 138.093 -1.2%#GBPAUD 1.7642 -0.58%#GBPEUR 1.09597 -0.69%#GBPNZD 1.8841 -0.56%#GBPCHF 1.183910 -0.9%#GBPCAD 1.7163 -0.76% pic.twitter.com/YhArmeZlvn

Related: 'Help is on the way': Covid relief bill deal agreed, says Mitch McConnell

The package would give $600 direct payments to individuals and boost unemployment payments by $300 a week. It also includes billions for small businesses, food assistance, vaccine distribution, transit and healthcare. It extends a moratorium on foreclosures and provides $25 billion in rental aid.