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Good morning. The new China virus has been confirmed in the U.S., Italy’s Five Star Movement may be in trouble and Netflix says it’s ready to take on all that new streaming competition. Here’s what’s moving markets.
With the death toll now at nine and the first confirmed case in the U.S., China will start nationwide screening to tackle the growing outbreak of the new respiratory virus as hundreds of millions are set to travel during the Lunar New Year holiday. The World Health Organization is set to declare later whether it’s an international public health emergency. So far, China said it hasn’t seen any evidence of so-called super spreaders — people who pass the disease on rapidly to others. As Asian stocks edge higher after a sell-off yesterday, here’s more on how other health scares have had a “ sharp and short-lived” impact on markets and how airlines and airports are dealing with the virus.
Italy’s Luigi Di Maio is reportedly about to resign from his role as leader of the anti-establishment Five Star Movement ahead of the group’s likely defeat in regional elections Sunday. The move would weigh on Prime Minister Giuseppe Conte’s fragile coalition, already plagued by constant skirmishes over issues from taxes to judicial reform, and the party’s convulsions are a sign that the chances of a snap election in Italy this year are rising. Di Maio summoned the party’s ministers to a meeting this morning, according to La Repubblica, so watch for more developments as the day progresses.
The streaming company may be facing its toughest year in history in terms of competition, but Netflix says it’s ready. Its shares rose as much as 4.3% in late trading after Netflix reported results that were generally upbeat as international clients helped offset a slowdown in the U.S., and pledged a 20% boost to spending this year. And it’s a huge week for U.S. earnings in general, with IBM reporting revenue that topped estimates on Tuesday and Intel Corp. and Procter & Gamble Co. reporting Thursday. European earnings are also getting under way, with strategists wondering if this will be the year companies finally deliver profit growth.
He railed against the climate change “prophets of doom,” but U.S. President Donald Trump also struck a surprisingly sunny tone on European trade deals from Davos, suggesting he’s keen to work with the U.K.’s “wonderful new prime minister,” to negotiate a “tremendous new deal.” He also claimed everyone wants to make an EU-U.S. deal and that there won’t be any problem requiring auto tariffs “if they’re fair.” Today at Davos, European Commission President Ursula von der Leyen will give a special address. For more on what’s happening in the Swiss Alps this week, subscribe to the Davos Diary.
Asian stocks recovered a fraction of Tuesday’s sell-off and European and U.S. futures followed suit. We’ll see where stocks go today after Germany’s DAX Index finally managed to pass a closing record Tuesday — though didn’t sustain that level through the end of trading. In European earnings today, we’ll get a peak at European luxury-goods makers as Burberry Group Plc posts fiscal third-quarter numbers. WH Smith Plc and French catering company Elior Group are among others also set to report.
What We’ve Been Reading
This is what’s caught our eye over the past 24 hours.
Saudi crown prince hacked Bezos’s phone, analysis suggests. Tesla hits $100 billion mark Musk needs for payout. New low-cost iPhone set to enter mass production. This hedge fund is now a climate radical. Are Davos plumbers Russian spies? The winemakers waiting for climate change. Phoney pack: is this the answer to kids’ anxiety?
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