The U.S. Market Is Mostly Flat In Early Trading
The U.S. market is mostly flat in early trading as investors fret over the spreading coronavirus. The number of infected has risen to 40,170 while the death toll exceeds that of SARS. Over the weekend, Chinese President Xi Jinping pledged his country to fight the disease and that lent some support to the equities market. The Dow Jones Industrial Average is leading the losses down -0.12%. The S&P 500 and NASDAQ Composite are both down about half that amount.
In stock news, attention is focused on the potential economic impact of the coronavirus outbreak. Chinese factories are supposed to reopen on Monday but the announcement may be more symbolic that not. Most businesses are expected to remain shuttered and may disrupt the global supply chain. The province of Hubei, where the virus originated from and the most heavily hit, is a major manufacturing center.
Restaurant Brands, the owner of Popeyes, beat on the top and bottom lines. The company’s so-called “chicken” war with Wendy’s and Bojangles helped pad the company’s results. Shares are up 2.0% in the premarket. Shares of Allergan are also moving higher in the early session after it beat on the top and bottom line.
EU Equities Move Lower
The EU equities market is moving lower at midday. The coronavirus and its impact to global supply chains is the primary reason. The CAC is down about -0.45% while the DAX and FTSE trail with losses of -0.38% and -0.28%. With China as its biggest trading partner, the EU is especially vulnerable to disruptions within the Chinese economy.
In stock news, embattles NMC Health is moving higher after it revealed approaches from two private equity firms. The company is still ensnared with a legal battle versus short-sellers claiming bad accounting practices. In other news, people close to NMC are under review for misreporting their disclosures. Shares of Daimler are flat at midday after the company announced job cuts and other cost-saving efforts. Exor is moving higher by 5.5% after it announced the possible divestiture of PartnerRE.
Asia Mostly Lower, Virus Causes Inflation To Surge
Asian markets are mostly lower at the end of Monday’s session. The Nikkei and Hang Seng are both down -0.60% while the Kospi and ASX post smaller losses. The mainland Shanghai Composite is the only index in the green, up 0.51%, after sentiment was buoyed by Xi’s pledge. On the economic front, Chinese CPI surged to 5.4% YOY and set a long-term high. The surge is due in part to the virus as well as high pork prices.