U.S. stock futures were down in Thursday premarket trading as investors signaled worries over China’s decision to trim interest rates to help boost its economy amid the coronavirus.
Dow futures dipped 92 points, while S&P and Nasdaq futures declined 11 and 37 points, respectively. Shares in Shanghai, however, improved 55 points after the People’s Bank of China lowered the one-year benchmark lending rate from 4.15% to 4.05% to support businesses struggling with costs as the illness continues to halt activities in the country. The five-year loan prime rate was also lowered from 4.80% to 4.75%.
The move was largely expected by analysts and marked the first cut since October. It comes a day after reports that China’s Ministry of Industry and Information Technology said Beijing would assist coronavirus-hit businesses by connecting their factories with technology firms to pinpoint weak links in their supply chains.
Authorities appear to have taken such steps to limit the economic casualties stemming from the illness, which has killed 2,130 people and infected upwards of 75,700 as of this morning.
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Travel restrictions in China have halted business in heavily affected areas, particularly in the outbreak’s epicenter of Wuhan. Many big-name brands and retailers including Nike, Skechers and Burberry have opted to close their doors and/or reduce operating hours. Some companies even lowered their fiscal year forecasts over fears that the health crisis could worsen.
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