Market Snapshot: Stock futures flat as investors keep eye on coronavirus

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Stock-index futures struggled for direction Monday as investors monitored developments around the spread of the coronavirus as earnings season moves into its final stages.

What are major indexes doing?

Futures on the Dow Jones Industrial Average YMH20, -0.06%  fell 13 points, or less than 0.1%, at 29,031, while S&P 500 futures ESH20, -0.02%  were off 0.25 point at 3,325.25. Nasdaq-100 futures were down 15 points, or 0.1%, at 29,029.

Stocks lost ground Friday, pulling back from record levels, but saw the Dow and S&P 500 each log their strongest weekly gains since June, while the Nasdaq Composite saw its strongest weekly advance since November 2018. The DJIA, -0.94%  rose 3% last week, ending Friday at 29,102.51, while the S&P 500 SPX, -0.54% saw a 3.2% weekly advance, ending at 3,327.71. The Nasdaq Composite COMP, -0.54% rose 4% for the week, ending Friday at 9,520.51.

What’s driving the market?

Stocks bounced back sharply last week from an end-of-January rout as worries about the spread of the coronavirus outbreak that emerged in China appeared to ease. Investors continue to keep an eye on developments surrounding the spread of the illness in the country and beyond.

China’s health ministry on Monday said another 3,062 cases had been reported over the previous 24 hours, raising the mainland’s total to 40,171. The death toll grew by 97 to 908, with at least two more deaths seen outside the country. The death toll has surpassed the 774 attributed to SARS, a 2003 viral outbreak that originated in China.

Meanwhile, the director-general of the World Health Organization warned Sunday that countries outside of China should be prepared for the spread of the coronavirus to accelerate.

“In the big picture, investors are still weighing the breadth and length of potential supply chain disruptions against the encouraging signs that the virus is being contained,” said Marios Hadjikyriacos, investment analyst at XM, in a note. “For now, the optimistic narrative seems to be winning out, possibly on hopes that the hit on global economic activity will ultimately be short-lived.”

Read: Why ‘buy the dip’ is the stock market’s default setting — and what it would take for that to change

Earnings season, meanwhile, moves into it final stretch this week. With nearly two-thirds of S&P 500 companies having reported through Friday, FactSet now expects profits to grow in the fourth quarter.

Earnings Watch: The earnings recession is expected to end after some big profit surprises

Which companies are in focus?
  • Shares of Restaurant Brands International Inc. QSR, +1.12%, the parent of Burger King and Popeyes, rose 2% in premarket trade, after reporting fourth-quarter earnings that topped expectations — boosted by “transformational” growth at Popeyes attributed to the popularity of the chain’s chicken sandwich.
  • Shares of Allergan PLC AGN, +2.16%  were up 0.9% in premarket action after reporting fourth-quarter results Monday morning.

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