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Stocks - U.S. Futures Move Higher; Europe Posts Strong Gains

By Peter Nurse

Investing.com - U.S. stock markets are set to open higher Friday, helped by a strong tone in Europe amid signs of improving business confidence and a lessening of concerns over the impact of the pneumonia-like virus in China.

At 6:55 AM ET (1155 GMT), futures for the S&P 500 Futures traded 7 points, or 0.2%, higher, futures for the Nasdaq 31 points, or 0.3%, higher, while the Dow Jones 30 Futures contract rose 73 points, or 0.3%.

Late Thursday, the World Health Organization decided against calling the virus a global health emergency, despite the death toll in China rising to 25.

“Make no mistake, this is an emergency in China, but it has not yet become a global health emergency,” Tedros Adhanom Ghebreyesus, the WHO’s director-general, said at a briefing in Geneva Thursday.

Markets in mainland China and South Korea are shut, while Hong Kong closed early, down just 8 points, for lunar new year holidays.

Stock market gains were strong in Europe Friday, helped by improved sentiment in large parts of the continent’s business community.

The early readings of the PMI data showed Britain's vast services sector returned to growth in January for the first time since August, while a downturn in manufacturing eased. Businesses were more confident than expected in Germany, continuing the recent signs of a pick up in economic activity. The French release, by contrast, was hit by the strikes against President Emmanuel Macron's pension reform plans.

At 06:55 AM ET (1155 GMT), the German DAX was 1.4% higher, the U.K.’s FTSE 100 gained 1.6%, France’s CAC 40 gained 1.1%, and the pan-eurozone index, the Euro Stoxx 50, up 1.3%.

Eyes will now turn to the release of the equivalent U.S. PMI data, at 0945 AM ET (1445 GMT). The manufacturing PMI was revised slightly lower to 52.4 from 52.5 in December of 2019. This release averaged 53.63 points from 2012 until 2019, reaching an all time high of 57.90 points in August of 2014.

In corporate news, Intel (NASDAQ:INTC) will be in focus after the tech giant published strong fourth quarter results, with sales up eight per cent to $20.21bn, compared with the $19.23 billion expected. Shares stood 5.6% higher premarket.

Shares in Broadcom (NASDAQ:AVGO) climbed 2.4% premarket after it disclosed late Thursday new deals with Apple (NASDAQ:AAPL), worth $15 billion, to supply the iPhone manufacturer with components.

By contrast, Skyworks (NASDAQ:SWKS) Solutions dropped 2.9% in premarket despite beating expectations with its latest quarterly report and upbeat guidance. The company competes with Broadcom (NASDAQ:AVGO) to supply Apple (NASDAQ:AAPL).

Elsewhere, oil prices continued to show weakness, amid fears that the emergence of the deadly virus in China could reduce demand for crude from the world’s largest importer.

AT 01:55 AM ET (0655 GMT), U.S. crude futures traded 0.4% at $58.38 lower and the international benchmark Brent contract fell 0.5% to $61.73. Gold futures for February delivery on New York’s COMEX dropped 0.4% to $1,558.65.

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