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US pre-open: Futures point to losses following coronavirus outbreak

By Iain Gilbert

Date: Tuesday 21 Jan 2020

US pre-open: Futures point to losses following coronavirus outbreak

(Sharecast News) - US futures were pointing to losses ahead of the bell on Tuesday as traders returned from the Martin Luther King Jr Day holiday to concerns over a new strain of pneumonia in China.
As of 1230 GMT, Dow futures were down 0.16%, while S&P 500 and Nasdaq-100 futures had the indices opening 0.29% and 0.38% weaker, respectively.

The Dow Jones closed 50.46 points higher on Friday following the release of some economic data out of China and a strong start to the earnings season.

An outbreak of the new coronavirus in China had already killed six people ahead of the Lunar New Year holiday, a time when hundreds of millions of people were set to travel, and was confirmed as being contagious by Chinese authorities the day before.

Many analysts expected an economic reaction similar to when the deadly Severe Acute Respiratory Syndrome crisis took place in 2003, with investors fleeing from risk assets in Asia overnight.

Over at the World Economic Forum in Davos, Switzerland, Donald Trump made it clear in his speech that he was not happy with the US Federal Reserve.

The President called on the central bank to lower rates at a quicker pace, which moved currency markets as the dollar slipped against the Euro and other G10 currencies.

Elsewhere, the International Monetary Fund downgraded its global economic growth forecast for 2020 from 3.4% to 3.3%, with the US economy now projected to grow 2% - a downward revision of 0.1%.

In corporate news, aerospace giant Boeing was in focus after it kicked off talks with banks to borrow $10.0bn as costs associated with its 737 Max aircraft continued to hurt its bottom line, while Capital One, Halliburton, Johnson & Johnson, Stanley Black & Decker and Timberland will all be in focus as they report earnings on Tuesday.

Things were quiet on the data front.

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