U.S. Index Futures Drop With Investors Weighing Virus Threat

(Bloomberg) -- U.S. equity-index futures extended drops as investors weighed whether global efforts to contain the coronavirus outbreak will be enough to soften its economic impact.

S&P 500 Index futures contracts expiring in March slid 1.3% at 8:50 a.m. in London. Contracts dropped 1.2% for the Dow Jones Industrial Average and 1.1% for the Nasdaq 100.

In Europe, the Stoxx 600 Index erased earlier gains of as much as 0.7% to trade little changed as cyclical sectors slid, with miners, carmakers and banks dropping the most.

“A sense of caution remains on top of investors’ minds as the virus situation continues to escalate in North America,” said Margaret Yang, a strategist at CMC Markets Singapore. “The Fed cut effect is fading and can be overtaken by virus concern.”

California has declared a state of emergency to give authorities greater leeway in combating the coronavirus, while the death toll from the disease surpassed 3,000 in China.

The S&P 500 had surged into the close Wednesday, nearly matching Monday’s rally that was the best in 14 months. Health-care firms led the spike, rising the most since November 2008, as the weak performance in Tuesday’s primaries by Bernie Sanders dented the threat of policies that would upend the industry.

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