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* Futures down: Dow 0.64%, S&P 0.89%, Nasdaq 0.39%
By Ambar Warrick
March 2 (Reuters) - U.S. stock index futures fell in
volatile trading on Monday, as investors weighed the efficacy of
interest rate cuts amid growing evidence of the economic impact
of the coronavirus outbreak.
Wall Street recorded its biggest weekly decline since the
2008 financial crisis on Friday amid rampant fears of a
recession resulting from the epidemic, which has now infected
around 86,000 people and killed more than 3,000.
Latest data from China showed factory activity in February
contracted at its sharpest pace on record, underlining the
impact on the world's second biggest economy from drastic travel
curbs and other public health measures. The figures prompted reassurances from the U.S. Federal
Reserve and the Bank of Japan to intervene with monetary
stimulus, if needed, sparking hopes of a coordinated effort by
central banks to inject liquidity and shore up growth.
Investors now expect the Fed to deliver a 50 basis points
rate cut 0#FF: when it meets on March 17-18. USD/
Financial markets are also awaiting final readings of the
U.S. Markit and ISM manufacturing indexes to gauge the health of
the domestic economy.
Flash readings of the indexes last month showed business
activity in both the manufacturing and services sectors stalled
in February. At 7:22 a.m. ET, Dow e-minis 1YMcv1 were down 163 points,
or 0.64%. S&P 500 e-minis EScv1 were down 26.25 points, or
0.89% and Nasdaq 100 e-minis NQcv1 were down 33 points, or
0.39%.
Wall Street's fear gauge .VIX jumped around 6%.
Cruise operator Carnival Corp CCL.N fell 8.1% in premarket
trading as the travel and leisure sector continued to reel under
disruptions caused by the virus outbreak.
Peers Royal Caribbean Cruises Ltd RCL.N and Norwegian
Cruise Line Holdings Ltd NCLH.N dropped about 3.6% and 6%,
respectively.
Airline stocks were further pressured by a jump in oil
prices, which rose on hopes of a deeper output cut. O/R
Delta Air Lines DAL.N and American Airlines Group Inc
AAL.O dipped about 1.8% each.
Major banks fell as increased bets on a rate cut prompted a
drop in bond yields. JPMorgan Chase & Co JPM.N , Citigroup
C.N and Wells Fargo & Co WFC.N fell between 1.4% and 2%.
In a bright spot, China's JD.com Inc JD.O rose 4.9% after
it forecast at least a 10% rise in revenue for the first
quarter, after posting better-than-expected quarterly results.