AP: Global stocks mostly slip as virus weighs on companies
February 20, 2020
TOKYO (AP) — Global shares mostly dipped Thursday as several companies estimated that the outbreak of the new coronavirus in China will weigh on their earnings.
France’s CAC 40 edged down 0.2% to 6,099 and Germany’s DAX fell 0.2% to 13,765. Britain’s FTSE 100 was flat at 7,458. Dow and S&P 500 futures were both down 0.2%.
FILE – In this Feb. 5, 2020, file photo trader Ashley Lara works on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EST on Wednesday, Feb. 19. (AP Photo/Richard Drew, File)
Companies including the world’s biggest shipper, A.P. Moller Maersk, and Air France detailed the costs of the virus. The French airline said it would cost it as much as $220 million in operating earnings.
The impact is not easing, with Australia’s Qantas saying it would slash flights to Asia.
The Shanghai benchmark, however, jumped 1.8% after China’s central bank cut interest rates to help ease credit for companies stricken by the virus outbreak.
A currency trader wearing a face mask watches monitors at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, Feb. 20, 2020. Asian shares were mixed Thursday after Wall Street recovered to record highs, but worries continued about the damage to the regional economy from the new virus that began in China. (AP Photo/Ahn Young-joon)
China’s central bank cut its one-year loan prime rate to 4.05% from 4.15% on Thursday, a move aimed at mitigating the economic damage from the COVID-19 sickness that is spreading mostly in China. The 5-year loan prime rate was cut to 4.75% from 4.80%. A medium-term rate was cut earlier in the week, raising hopes for further monetary stimulus.
Japan’s benchmark Nikkei 225 gained 0.3% to finish at 23,479.15, shedding bigger early gains. Australia’s S&P/ASX 200 added 0.3% to 7,162.50. and the Shanghai Composite index picked up 1.8% to 3,030.15. But South Korea’s Kospi lost 0.7% to 2,195.50. Hong Kong’s Hang Seng dipped 0.2% to 27,609.16, while India’s Sensex was little changed at 41,330.57.
The U.S. market open is likely to affect sentiment after indexes this week shook off virus-induced concerns to breach record highs.
Currency traders watch monitors at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, Feb. 20, 2020. Asian shares were mixed Thursday after Wall Street recovered to record highs, but worries continued about the damage to the regional economy from the new virus that began in China. (AP Photo/Ahn Young-joon)
Low rates have been a key underpinning for the strong U.S. stock market, which has rallied even though growth in corporate profits has been weak. The Fed released minutes Wednesday afternoon from its last policy meeting, where officials said they see the current level of monetary policy “as likely to remain appropriate for a time,” at least until data on the economy shows a change in momentum.
ENERGY: Benchmark crude oil added 49 cents to $53.78 a barrel in electronic trading on the New York Mercantile Exchange. It jumped $1.20 overnight. Brent crude oil, the international standard,was up 30 cents at $59.42 a barrel.
CURRENCIES: The dollar rose to 111.96 Japanese yen from 110.34 yen on Wednesday. The euro weakened slightly to$1.0790 from $1.0805.
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Yuri Kageyama is on Twitter https://twitter.com/yurikageyama
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