Global Stocks Drift as Coronavirus, Huawei Concerns Dominate

Global stocks wavered Friday as investors weighed the potential impact of the fast-spreading coronavirus and the fresh tensions stemming from the U.S.'s battle against China's Huawei Technologies on economic growth.

Futures tied to the Dow Jones Industrial Average edged up 0.1%, while the Stoxx Europe 600 index swung between gains and losses. Over in Asia, the Shanghai Composite Index closed 0.4% higher.

Investors and public health officials have grown concerned this week about when the coronavirus outbreak might peak after Chinese authorities changed the criteria for diagnosis, leading to a dramatic increase in the new cases. While the surge in reported figures in Hubei province, the epicenter of the infections, may be a one-off event, the broader classification rules could mean that more undiagnosed cases might come to light.

Adding to investor jitters is the prospect of fresh tensions between Washington and Beijing. Chinese telecommunications giant Huawei and two of its U.S. subsidiaries were charged with racketeering conspiracy and conspiracy to steal trade secrets in a federal indictment unsealed late Thursday. The new charges, which Huawei called unfair and unfounded, represent fresh measures by Washington in a campaign to lock Huawei out of next-generation mobile networks on national security grounds.

Among European equities, Royal Bank of Scotland Group was among the biggest losers. The stock declined 5.8% after the U.K. bank reduced the size of its investment banking business and projected as much as GBP1 billion ($1.3 billion) in costs this year, stemming from strategic changes it plans to make.

Later in the day, investors will be watching for the latest retail sales data from the U.S. Commerce Department, which will provide fresh signs on whether holiday-season spending continued into the new year. Economists expect to see a 0.3% rise in sales during January compared with the prior month.

Write to Avantika Chilkoti at Avantika.Chilkoti@wsj.com

By Avantika Chilkoti

Global stocks edged higher Friday as investors' concerns about a sharp rise in coronavirus cases from earlier in the week faded, allowing equities to resume a rally that has taken U.S. and European benchmarks to fresh records this year.

Futures tied to the Dow Jones Industrial Average ticked up less than 0.1%, while the Stoxx Europe 600 index gained almost 0.2%. Over in Asia, the Shanghai Composite Index closed 0.4% higher.

Investors had briefly grown concerned this week about when the coronavirus outbreak might peak after Chinese authorities changed the criteria for diagnosis, leading to a dramatic increase in the new cases. But stocks in the U.S. and in Europe have largely continued their rally from last year on speculation that central banks and governments will take steps to shield the global economy from the impact of the outbreak.

"The market wants to believe this is a one-quarter blip and we're back to the races," said Neil Dwane, global strategist at Allianz Global Investors.

Investors also largely shrugged off the signs of fresh tensions between Washington and Beijing that emerged overnight after the U.S. charged Chinese telecommunications giant Huawei and two of its U.S. subsidiaries with racketeering conspiracy and conspiracy to steal trade secrets. Tensions between the two nations had roiled markets for large parts of last year, and eased only briefly after they sealed an initial trade accord that failed to address a number of crucial issues.

"We always thought the 'phase one' trade deal actually resolve tensions between the U.S. and China," said Simona Gambarini, markets economist at Capital Economics in London. "The two economies are based on totally different foundations."

--would not

Ahead of the opening bell in New York, Nvidia advanced around 7% after the graphics-chip maker's fourth-quarter earnings topped Wall Street's expectations.

Expedia Group gained over 12% in offhours trading after the online travel company projected cost savings and growth in a measure of profit for this year. Shares in Arista Networks dropped over 8% after the cloud-networking provider reported a drop in fourth-quarter revenue.

Among European equities, Royal Bank of Scotland Group was among the biggest losers. The stock declined 5.8% after the U.K. bank reduced the size of its investment banking business and projected as much as GBP1 billion ($1.3 billion) in costs this year, stemming from strategic changes it plans to make.

Later in the day, investors will be watching for the latest retail sales data from the U.S. Commerce Department, which will provide fresh signs on whether holiday-season spending continued into the new year. Economists expect to see a 0.3% rise in sales during January compared with the prior month.

Write to Avantika Chilkoti at Avantika.Chilkoti@wsj.com

By Avantika Chilkoti

Global stocks drifted higher Friday as investors' concerns about a sharp rise in coronavirus cases from earlier in the week faded.

Futures tied to the Dow Jones Industrial Average wavered between gains and losses, while the Stoxx Europe 600 index ticked up almost 0.1%. Over in Asia, the Shanghai Composite Index closed 0.4% higher.

Investors had briefly grown concerned this week about when the coronavirus outbreak might peak after Chinese authorities changed the criteria for diagnosis, leading to a dramatic increase in the new cases. But stocks in the U.S. and in Europe have largely continued their rally from last year on speculation that central banks and governments will take steps to shield the global economy from the impact of the outbreak.

"The market wants to believe this is a one-quarter blip and we're back to the races," said Neil Dwane, global strategist at Allianz Global Investors.

Investors also largely shrugged off the signs of fresh tensions between Washington and Beijing that emerged overnight after the U.S. charged Chinese telecommunications giant Huawei and two of its U.S. subsidiaries with racketeering conspiracy and conspiracy to steal trade secrets. Tensions between the two nations had roiled markets for large parts of last year, and eased only briefly after they sealed an initial trade accord that failed to address a number of crucial issues.

"We always thought the 'phase one' trade deal would not actually resolve tensions between the U.S. and China," said Simona Gambarini, markets economist at Capital Economics in London. "The two economies are based on totally different foundations."

Ahead of the opening bell in New York, Nvidia advanced around 6.2% after the graphics-chip maker's fourth-quarter earnings topped Wall Street's expectations.

Expedia Group gained over 12% in offhours trading after the online travel company projected cost savings and growth in a measure of profit for this year. Shares in Arista Networks dropped over 7% after the cloud-networking provider reported a drop in fourth-quarter revenue.

Among European equities, Royal Bank of Scotland Group was among the biggest losers. The stock declined 6.4% after the U.K. bank reduced the size of its investment banking business and projected as much as GBP1 billion ($1.3 billion) in costs this year, stemming from strategic changes it plans to make.

Write to Avantika Chilkoti at Avantika.Chilkoti@wsj.com

By Avantika Chilkoti

U.S. stocks were little changed Friday as investors' concerns about a sharp rise in coronavirus cases from earlier in the week faded.

The Dow Jones Industrial Average fell 22 points, or less than 0.1%, shortly after the opening bell. The S&P 500 added less than 0.1% and the Nasdaq Composite rose 0.1%.

Investors had briefly grown concerned this week about when the coronavirus outbreak might peak after Chinese authorities changed the criteria for diagnosis, leading to a dramatic increase in the new cases. But stocks in the U.S. and in Europe have largely continued their rally from last year on speculation that central banks and governments will take steps to shield the global economy from the impact of the outbreak.

"The market wants to believe this is a one-quarter blip and we're back to the races," said Neil Dwane, global strategist at Allianz Global Investors.

Investors also largely shrugged off the signs of fresh tensions between Washington and Beijing that emerged overnight after the U.S. charged Chinese telecommunications giant Huawei and two of its U.S. subsidiaries with racketeering conspiracy and conspiracy to steal trade secrets. Tensions between the two nations had roiled markets for large parts of last year, and eased only briefly after they sealed an initial trade accord that failed to address a number of crucial issues.

"We always thought the 'phase one' trade deal would not actually resolve tensions between the U.S. and China," said Simona Gambarini, markets economist at Capital Economics in London. "The two economies are based on totally different foundations."

Meanwhile, American shoppers increased their spending in January, signaling a key engine of the economy remained on steady footing. Retail sales increased a seasonally adjusted 0.3% in January from a month earlier, the Commerce Department said Friday.

Shares of Nvidia advanced 7.4% after the graphics-chip maker's fourth-quarter earnings topped Wall Street's expectations.

Expedia Group gained over 11% after the online travel company projected cost savings and growth in a measure of profit for this year.

Elsewhere, the Stoxx Europe 600 index was little changed. Over in Asia, the Shanghai Composite Index closed 0.4% higher.

Among European equities, Royal Bank of Scotland Group was among the biggest losers after the U.K. bank reduced the size of its investment banking business and projected as much as GBP1 billion ($1.3 billion) in costs this year, stemming from strategic changes it plans to make.

Write to Avantika Chilkoti at Avantika.Chilkoti@wsj.com


  (END) Dow Jones Newswires
  02-14-20 0541ET
  Copyright (c) 2020 Dow Jones & Company, Inc.

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