Stock markets retreated Thursday on growing concerns over the economic impact of the new coronavirus that has killed 170 people in China after a spike in the number of deaths.

Tech stocks and airlines were among key losers as the World Health Organization called an urgent meeting on whether to declare a global health emergency over the virus.

Around 1100 GMT, London's benchmark FTSE 100 index was down 0.7 percent. Investors were looking ahead also to a policy update due 1200 GMT from a Bank of England meeting that could see an interest rate cut on the eve of Brexit to help boost Britain's stalled economy.

In the eurozone, Frankfurt's DAX 30 index shed 1.0 percent and the Paris CAC 40 slumped 1.2 percent.

"With the coronavirus death toll leaping... the European markets reverted back to panic mode, quickly unravelling the rebound managed in the last couple of sessions," said Connor Campbell, analyst at Spreadex trading group.

The pound dropped also, with investors "clearly anxious about this afternoon's knife edge Bank of England meeting", he added.

Traders' main focus remained the virus and increased concerns over its spread weighed heavily also on oil prices Thursday, with benchmark Brent crude sliding more than two percent.

The WHO, which initially downplayed the severity of the disease, has warned all governments to be "on alert" as China reported 1,700 new cases of the SARS-like virus that has infected 7,700 people and been detected in at least 15 countries.

Airlines around the world are either suspending or paring back services in and out of China following cases of human-to-human transmission outside the country, and manufacturers have also been cutting their Chinese operations.

US Federal Reserve Chairman Jerome Powell said the coronavirus posed a new risk to growth in China and elsewhere.

In Asian stock markets Thursday, Taipei closed down 5.8 percent on the first day of trade since the Chinese New Year break, with Eva Airways plunging 9.9 percent and market heavyweight and key Apple supplier Taiwan Semiconductor Manufacturing (TSMC) sliding five percent.

Fellow Apple supplier Hon Hai Precision Industry fell by the daily limit 10 percent after it said most of its manufacturing plants in China would remain closed until February 10.

Elsewhere Thursday, Tokyo's main stocks index closed down 1.7 percent and Hong Kong ended 2.6 percent lower.

Japanese automaker Toyota said it would keep its plants in China closed until at least February 9 over concerns about the outbreak.

The Fed held its policy interest rate steady on Wednesday but was on alert for possible contagion to the domestic and global economies.

"There will clearly be implications at least in the near term for Chinese output and I would guess for some of their close neighbours," Powell told reporters following the Fed's policy meeting.

Wuhan SARS virus
US Federal Reserve Chairman Jerome Powell said the coronavirus posed a new risk to growth in China and elsewhere Photo: AFP / Hector RETAMAL

However, "the situation is really in its early stages and it's very uncertain about how far it will spread and what the macro-economic effects will be", he said. "We are very carefully monitoring the situation."

London - FTSE 100: DOWN 0.7 percent at 7,433.06 points

Frankfurt - DAX 30: DOWN 1.0 percent at 13,218.39

Paris - CAC 40: DOWN 1.2 percent at 5,881.68

EURO STOXX 50: DOWN 0.9 percent at 3,703.87

Hong Kong - Hang Seng: DOWN 2.6 percent at 26,449.13 (close)

Tokyo - Nikkei 225: DOWN 1.7 percent at 22,977.75 (close)

Shanghai - Composite: Closed for a public holiday

New York - DOW: UP less than 0.1 percent at 28,734.45 (close)

Pound/dollar: DOWN at $1.3010 from $1.3021 at 2200 GMT

Euro/pound: UP at 84.69 from 84.56 pence

Euro/dollar: UP at $1.1017 from $1.1010

Dollar/yen: UP at 108.92 from 109.02

Brent Crude: DOWN 2.2 percent at $58.52 per barrel

West Texas Intermediate: DOWN 1.9 percent at $52.36 per barrel

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