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© Reuters.By Peter Nurse
Investing.com – European stock markets are set to open sharply lower Monday, following weakness in Asia caused by a sharp escalation of Chinese measures to curtail the spread of the deadly coronavirus.
At 02:15 ET (0715 GMT), the contract traded 137 points, or 1% lower. France’s were down 72 points, or 1.2%, while the contract in the U.K. dropped 63 points, or 0.9%. Futures on the pan-eurozone index, the , fell 40 points, or 1.1%.
Markets in mainland China and Hong Kong are shut, but Japan’s closed 2% lower and futures continues to tumble, hitting their lowest level since October as traders priced in the hit to Chinese demand.
and government bonds rallied.
“According to recent clinical information, the virus’s ability to spread seems to be getting somewhat stronger,” China’s National Health Commission Minister Ma Xiaowei said at a press briefing Sunday, adding that it is infectious in its incubation period, i.e. before symptoms show, making it harder to contain.
Nearly 2,000 people in China had been infected and 56 killed by the disease, Ma said Sunday, although Reuters reported later that the death toll has since increased to 80 and the number of confirmed cases to 2,744. Over the last week, both numbers have been rising at close to 50% a day.
“China has extended its New Year’s holiday until 2 February in efforts to curb the virus and airports around the world have stepped up screening of passengers from China,” said analyst Bjorn Tangaa Sillemann at Danske Bank, in a research note.
“However, with about 5 million residents leaving the city of Wuhan (where the virus originates) before the government shutdown of the city on Thursday, the job of containing the epidemic seems considerable,” he added.
Aside from worries over the impact of the virus in Asia, fresh economic data are thin on the ground in Europe Monday while the two-day meeting of the Federal Reserve that ends on Wednesday coupled with the Bank of England’s meeting on Thursday could keep a lid on activity.
Turning to corporate earnings, most eyes will be on the U.S. this week as tech giants Facebook (NASDAQ:), Apple (NASDAQ:), Amazon (NASDAQ:) and Google parent Alphabet (NASDAQ:) are all due to report their financial results for the final quarter of 2019.
Elsewhere, worries about the extent of the hit to the demand for oil from China on the back of the shutdown in activity to curtail the spread of the virus continues to weigh on the price of oil.
At 2:15 AM ET (0715 GMT), futures traded 2.2% lower at $53.02 and the international benchmark contract fell 2.1% to $58.66. for February delivery on New York’s COMEX were up 0.5% at $1,578.75.
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