Futures climb on China plan to cut tariffs on U.S. products

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© Reuters. Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York© Reuters. Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York

By Medha Singh

(Reuters) – U.S. stock index futures rose on Thursday as China’s plan to halve additional tariffs on some American goods helped allay fears over the financial fallout of the coronavirus epidemic.

Beijing said it would lower extra levies imposed last year against 1,717 U.S. products, weeks after the signing of a Phase 1 trade deal.

The tariff cut follows hefty monetary stimulus by China’s central bank earlier this week and is expected to lift investor sentiment, which has been impacted by shutdowns in the world’s second largest economy due to the virus outbreak.

A string of positive U.S. economic data too have helped mitigate worries, fueling a three-day rally on Wall Street.

The Nasdaq () and the S&P 500 () hit record highs in the previous session, with the benchmark index on pace for its best week in eight months after last week’s steep pullback.

However, the impact of the health emergency in China continued to show up in corporate reports. Chipmaker Qualcomm Inc (O:) flagged a potential threat to the mobile phone industry from the outbreak, with a possible impact on manufacturing and sales.

Its shares fell 2.2% in premarket trading.

At 7:09 a.m. ET, <1YMcv1> were up 135 points, or 0.46%. were up 13.75 points, or 0.41% and were up 50.75 points, or 0.54%.

The fourth-quarter earnings season is more than half done with nearly 70% of S&P 500 companies exceeding their earnings estimates, according to IBES data form Refinitiv. Quarterly profit is expected to have risen 1.6% for the S&P firms.

Tesla Inc (O:) slipped 1.3%, falling for the second day after a stunning six-day rally.

Twitter Inc (N:) gained about 6% after the micro-blogging platform touched $1 billion in quarterly revenue for the first time ever, beating analysts’ estimates.

As the week draws to a close, investor attention will shift to the U.S. jobs report on Friday.

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