Coronavirus concerns weigh on sentiment

Coronavirus concerns weigh on sentiment

LONDON — European stocks are expected to open flat to slightly higher on Wednesday as coronavirus concerns weigh on global markets.

London’s FTSE is expected to open 14 points higher at 5,984, Germany’s DAX is seen 10 points higher at 13,029, France’s CAC 40 up 6 points at 4,954 and Italy’s FTSE MIB 8 points lower at 19,551, according to IG.

The pandemic remains the key concern for investors with discouraging news that a pair of coronavirus drug trials have been paused in the U.S. over safety concerns.

Eli Lilly’s antibody treatment trial has been put on hold, the company confirmed to CNBC, and Johnson & Johnson announced Monday it has paused late-stage trials of its coronavirus vaccine candidate. While brief suspensions are routine in the world of drug trials, the latest cast added uncertainty on drug development timelines.

U.S. stocks fell on Tuesday, snapping a four-day winning streak, following the drug trial news but U.S. stock index futures rose in overnight trading. Meanwhile, stocks in Asia-Pacific were lower in Wednesday trade as investors monitored a speech from Chinese President Xi Jinping.

Investors are also considering the global economic outlook after the International Monetary Fund revised its forecasts for economic growth this year. The global economy is now projected to contract by 4.4% in 2020 — an upward revision from an estimate of -4.9% made in June (which itself was revised to -5.2% due to a new methodology used by the IMF).

On the earnings front, retailer ASOS releases full-year results and, data-wise, the euro zone reports industrial production figures for August.

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