UPDATE 2-UK stocks slip as virus fears quell risk appetite

* FTSE 100, FTSE 250 down 0.4%
* New coronavirus cases tick up
* Daejan outshines market on buyout offer

(Adds news items, updates to close)
By Shashwat Awasthi and Muvija M
Feb 21 (Reuters) - UK shares fell on Friday as investors
took measures to reduce their exposure to perceived risky assets
as the coronavirus continued to spread, while a buyout offer
powered mid-cap real estate investment firm Daejan to an
all-time high.
The FTSE 100 .FTSE slipped 0.4% and marked its second
consecutive week in the red after an uptick in new cases of the
virus in China and South Korea hit stocks more exposed to
commodity prices, including oil majors and miners .FTNMX1770 .
"Perhaps the reality of the situation is starting to hit
home for investors or maybe, and probably more likely, they're
using the slew of (company earnings) warnings to take some
profit and risk off the table," OANDA analyst Craig Erlam said.
The FTSE 250 .FTMC was also 0.4% lower, but Daejan
Holdings DJAN.L helped cap losses, gaining 55.7% to match its
8050 pence per share offer price. The spread of the China-linked coronavirus, which has killed
more than 2,200 people, dominated headlines again this week,
keeping volatility elevated in global markets.
Data showed U.S. business activity in both the manufacturing
and services sectors stalled in February with companies
increasingly concerned about the epidemic. Firms including tech giant Apple AAPL.O have warned of a
hit to sales, leading market participants away from equities and
into safe haven assets like gold.
Still, Erlam raised the possibility of a quick rebound as
dealers look to buy into assets at a cheap price.
"This is a dip buying environment so it's probably only a
matter of time until investors pile back in on the 'discount
goods'," he said.
In other moves, education group Pearson PSON.L skidded 4%
to the bottom of the blue-chip bourse after its annual profit
came in slightly below its forecast. Shares of Royal Mail RMG.L fell 2.2% as the postal group's
largest labour union said it could call a strike as early as
next month.