US STOCKS-S&P 500, Nasdaq set to retreat from record highs as virus fears build

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* Morgan Stanley falls on $13 bln deal to buy E*Trade
* L Brands skids on deal to sell Victoria's Secret
* Futures down: Dow 0.23%, S&P 0.24%, Nasdaq 0.29%

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By Medha Singh
Feb 20 (Reuters) - U.S. stock indexes were set to open
slightly lower on Thursday as a spike in the number of
coronavirus cases outside China raised concerns about the global
impact of the epidemic, while E*Trade Financial soared on a
buyout offer from Morgan Stanley.
The discount brokerage ETFC.O was up 23.9% in premarket
trading after Morgan Stanley MS.N offered to buy it in a $13
billion deal, the biggest by a Wall Street bank since the global
financial crisis. Morgan Stanley's shares fell 4.9%.
The mood elsewhere was more subdued, as the number of new
coronavirus cases jumped in South Korea, with Japan reporting
two new deaths. Research also suggested that the virus was
spreading faster than previously thought. "There is still uncertainty about how long this (outbreak)
is going to last and how big the economic effect is going to be,
not just on China, but on supply chains around the world," Scott
Brown, chief economist at Raymond James in St. Petersburg,
Florida, said.
Recent data from China has pointed to a slowdown in the
outbreak, but the figures partly reflect a change in the
diagnostic method, adding a degree of skepticism to whether the
daily tallies accurately reflect the spread of the virus.
"There is longer term optimism," said Brown. "Once (the
virus) is contained, you are going to see a snap back in
growth."
Recent policy easing by China, a largely
better-than-expected fourth quarter earnings season and hopes
that the economic jolt from the coronavirus will be short-lived
have pushed Wall Street's main indexes to new highs in recent
weeks.
The benchmark S&P 500 .SPX and the tech-heavy Nasdaq
.IXIC closed at record highs on Wednesday.
At 9:01 a.m. ET, Dow e-minis 1YMcv1 were down 68 points,
or 0.23%. S&P 500 e-minis EScv1 were down 8 points, or 0.24%
and Nasdaq 100 e-minis NQcv1 were down 28 points, or 0.29%.
In other corporate news, L Brands Inc LB.N slid 10.4% on
plans to sell control of its Victoria's Secret unit to
investment firm Sycamore Partners, valuing the lingerie brand at
$1.1 billion. ViacomCBS Inc VIAC.O dropped 8.6% as its earnings fell
short of revenue and profit expectations in its first quarterly
earnings results since closing its merger.