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Stocks - Europe Seen Lower; Corporate Earnings in Focus

By Peter Nurse - European stock markets are set open lower Thursday, following a jump in the number of people affected by the coronavirus in China. However, a busy corporate earnings session is likely to divert attention.

At 02:30 ET (0730 GMT), the DAX futures contract traded 83 points, or 0.6% lower. France's CAC 40 futures were down 24 points, or 0.4%, while the FTSE 100 futures contract in the U.K. fell 15 points, or 0.2%. Futures on the pan-eurozone index, the Euro Stoxx 50, dropped 22 points, or 0.6%.

China's Hubei province, where the virus is believed to have originated, reported 242 new deaths late Wednesday, double the previous day's toll, and confirmed 14,840 new cases.

The rise in the number of Hubei cases, which came as officials adopted a new methodology for counting infections, is a ninefold increase from a day earlier.

The new methodology effectively lowers the bar for classifying new infections, contributing to the spike in cases, but this dent to sentiment was enough to present a selling opportunity after several days of gains.

That said, there has been a surge in earnings reports in Europe early Thursday, and these are likely to attract most of the attention.

U.K. bank Barclays (LON:BARC) raised its dividend after a strong fourth quarter and an outlook free of the burdens of payment protection insurance, but the news was overshadowed by the announcement of a probe by the Financial Conduct Authority into the relationship between CEO Jes Staley and the late sex offender Jeffery Epstein.

Credit Suisse (SIX:CSGN) posted a 69% rise in annual net profit on Thursday, its best numbers since 2010, just as Chief Executive Tidjane Thiam bids farewell to the Swiss banking giant.

Food goliath Nestle (SIX:NESN) expects growth to accelerate over the next two years toward its mid-single digit organic growth target, initially set for 2020, after it hit a four-year high at 3.5% and profitability improved in 2019.

Commerzbank (DE:CBKG) swung to a net loss for the final quarter of 2019 as it booked a restructuring charge related to planned job cuts at the lender. It also lowered its dividend for the year, but these weak figures were still better than expected.

Pernod Ricard (PA:PERP) reported higher net profit and sales for the first half of its fiscal year, but the French premium spirits maker slashed its full-year guidance, saying that it expects the coronavirus outbreak to have a severe impact on its third fiscal quarter.

In some positive economic news, French unemployment fell unexpectedly in the final three months of last year to 8.1%, an 11-year low, from 8.5% in the third quarter, offering President Emmanuel Macron a boost on the economic front.

Elsewhere, the oil market was largely unchanged Thursday, after volatile trading over the last few weeks.

AT 02:00 AM ET (0730 GMT), U.S. crude futures traded 0.1% higher at $51.22 a barrel and the international benchmark Brent contract fell 0.1% to $55.72. Additionally, gold futures rose 0.3% to $1,576.55/oz while EUR/USD traded at 1.0876, up 0.1|%.

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