By Peter Nurse

Investing.com - European stock markets are set to open lower Tuesday, as a revenue warning from Apple (NASDAQ:AAPL) and weak earnings from HSBC laid bare the extent of the damage caused by the outbreak of the coronavirus in China.

At 02:00 ET (0700 GMT), the DAX futures contract traded 86 points, or 0.6% lower. France's CAC 40 futures were down 33 points, or 0.5%, while the FTSE 100 futures contract in the U.K. fell 43 points, or 0.6%. Futures on the pan-eurozone Euro Stoxx 50, dropped 22 points, or 0.6%.

Late Monday, Apple (NASDAQ:AAPL) said it doesn’t expect to meet its revenue guidance for the March quarter due to work slowdowns and lower demand due to the outbreak of Covid-19 in China.

The tech giant was expected to be hard hit given how much of its supply chain and consumer market are in China, but the sales warning is a graphic example of the impact on one of Wall Street’s favourite stocks which has been priced for success.

Apple shares (NASDAQ:AAPL) are up over 10% already this year, having climbed over 80% last year, and now make up around 12% of the Nasdaq 100 index.

Adding to Tuesday’s woes was a disappointing earnings report from HSBC (LON:HSBA), which announced a drop of 33% to its profit before tax for 2019, hit by one-time write-offs linked to its investment banking and commercial banking businesses in Europe.

HSBC, which makes most of its money in Asia, also warned that the ongoing coronavirus epidemic could in the long run reduce its revenue and cause bad loans to rise as supply chains are disrupted.

Europe’s largest bank by assets also unveiled plans to cut $100 billion in assets, slash its investment bank and restructure in the United States and Europe, as part of an overhaul in a bid to improve returns.

Capital Economics said in a report that it is now all but certain that China's economy will contract in quarter-on-quarter terms in the first quarter. "We have penciled in a fall in output of 2.5%," wrote group chief economist Neil Shearing.

Elsewhere, Accor (PA:ACCP), Europe's largest hotel group, could be in focus after it said it was joining forces with American card giant Visa (NYSE:V) to offer a payment card to members of its lifestyle loyalty program

Looking at European economic data, the German ZEW is due at 05:00 AM ET (1000 GMT), and will be the first post-coronavirus indicator of sentiment in the eurozone’s largest economy. Investing.com has predicted a drop in the key economic sentiment indicator to 21.5 from 26.7.

Also due Tuesday, at 04:30 AM ET (0930 GMT), will be the latest unemployment data from the U.K., which will be of interest as a pointer to the thinking in the Bank of England’s Monetary Policy Committee ahead of its next rate-setting meeting.