Dow Futures Erase Gains after G7 Statement Falls Short
Investing.com
Published Mar 03, 2020 07:50AM ET
By Noreen Burke
Investing.com - Dow futures erased gains on Tuesday after G7 finance officials stopped short of committing to specific actions to offset fallout in the global economy from the coronavirus outbreak.
By around 07:45 AM ET (1245 GMT) Dow futures were down 9 points, erasing gains of more than 250 points earlier in the day. S&P 500 futures were 0.4% lower while Nasdaq 100 futures were almost unchanged for day.
The G-7 said in a statement they will use policy tools to curb an economic slowdown, but the group did not agree to any coordinated action.
The premarket losses came a day after the Dow surged over 5% while the S&P 500 and Nasdaq each jumped more than 4% in a major rebound following last week's steep sell-off sparked by fears about the coronavirus.
It was the strongest one-day gain for the Dow since 2009, while the S&P 500 and Nasdaq each had their strongest one-day rise since December 2018.
Markets had been boosted by hopes for a coordinated policy response from governments and central banks to deal with the risks to the global economy posed by the outbreak.
The decision to hold a G7 call came after the head of the European Central Bank, Christine Lagarde, on Monday joined the chorus of heavyweight central bank chiefs signalling a readiness to deal with the threat from the outbreak.
The central banks of Japan, Britain and the United States have all signaled willingness to inject more cash into the system, and markets are now discounting a 50 basis-point cut in the target range for fed funds at the Federal Reserve's next policy meeting in two weeks' time. Outside the G7, the central banks of Australia and Malaysia both cut their key rates by 25 basis points at their respective meetings on Tuesday. The RBA also left the door open to further easing.
--Reuters contributed to this report
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