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UK stock markets traded in the negative territory after starting marginally higher on Thursday as the government announced its new rules for the upcoming days in wake of the pandemic. The headline index FTSE oscillated between a range of 6,412.65 and 6,349.53 until 2 pm (GMT). Matt Hancock, Secretary of State for Health, on Thursday announced that the government has agreed to lift the lockdown restrictions across England from 2 December.
Following the announcement, the markets edged up from the intraday bottom, recovering partially the morning losses. The FTSE 100 gained nearly 0.38 per cent from the low of 6,350.50 to 6,374.54 in the afternoon deals. The markets reacted in a mixed bag manner as the benchmark index slipped further into the negative zone after showing signs of partial recovery in the late afternoon deals.
New Covid-19 rules
Under the new Covid-19 rules that will be implemented from 2 December, the government has decided to introduce the 3-tier system. According to the government, the relaxations offered through a calculative tiering framework will prevent the need to impose stiffer nationwide measures or impose lockdowns.
The restrictions under the second lockdown will terminate from the midnight of 1 December, thereby, providing a relaxed operative regime for businesses as well as a relatively unbound environment for the local dwellers.
Under the latest guidelines, one of the most important restrictions that would be lifted will be the ‘stay home’ clause. Other relaxations include reopening of gyms, personal care centers, non-essential retail outlets, entertainment and leisure sectors according to the tiers system. The government has allowed weddings, outdoor sports and communal worship to resume.
Three-tier system
The government’s tier system is likely to go down well for the ailing business sector as compared to stricter countrywide lockdown. The government has advised people to work from home (if possible) for the locations falling in tier 1.
However, it is being considered detrimental for the hospitality sector, as all the establishments which offer alcohol have been mandatorily ordered to close down except those operating as restaurants. Alcohol can only be served with substantial meals in the hospitality venues.
In tier 3, the hospitality establishments have been asked to shut down, except services such as drive-through, delivery and takeaway. The accommodation providers and hotels must close regardless of specific exemptions, such as for people staying to attend funerals, people on work tours and individuals staying at private accommodations from where they are not able to return to their respective homes.
Further, all the indoor entertainment venues including cinemas, theatres, bowling alleys are necessarily required to shut their operations. The government has ordered to restart the outdoor sports and has said to take precautions against the sports that have higher risk due to physical contact. Although a spectator-free event can be conducted for an elite sport.
