EU Worries Push Stock Futures Lower


FOX Business: The Power to Prosper

Stock-index futures pointed to more selling on Wall Street following two straight days of losses as worries over Europe's debt crisis persisted.

Continue Reading Below

Today's Markets

As of 8:37 a.m. ET, Dow Jones Industrial Average futures slipped 12 points to 11,883, S&P 500 futures fell 0.25 point to 1,220 and Nasdaq 100 futures dipped 4.3 points to 2,263.

Headlines from Europe have driven the markets much of this week, and appeared poised to continue doing so on Wednesday. Traders have been paying especially close attention to bond auctions amid worries major economies, such as Italy, the eurozone's third biggest, may end up paying painfully-high borrowing costs on the private market.

Italy sold 3 billion euro of five-year bonds at 6.47% -- a euro-era high -- and nearly 20 basis points higher than it had to pay at its last offering for the same notes. Italy has to refinance a substantial level of debt next year, and if it is unable to do so on the private markets at reasonable rates, it may require a rescue, analysts say. The country's benchmark 10-year note presently yields 7.09%, above the psychologically important 7% mark.

Also on the European front, a German consultancy trimmed its expectations of the country's 2012 economic output, raising concerns that Europe's economic powerhouse isn't immune to headwinds from the debt crisis. The Ifo institute expects the country's economy to grow at 0.4% next year, or even slower if the debt crisis gets worse, which is half the pace it forecast in October.

The euro is trading at the lowest level since January, and continuing to trend lower. The common currency recently fell 0.34% to $1.2986. The greenback, meanwhile, rose 0.29% against a basket of six world currencies. European stocks fell 1.5%.

Energy markets have also come into focus as oil prices have fluctuated violently, hovering about the $100 a barrel mark. The Organization of Petroleum Exporting Countries has agreed on a 30 billion barrel per day cap on oil output that would include all 12 members of the cartel.

Oil futures have fallen slightly deeper into the red on the reports, with the leading crude oil contract falling $1.48, or 1.5%, to $98.66 a barrel. Wholesale RBOB gasoline dipped 1% to $2.60 a gallon.

Gold has fallen sharply this week. The precious metal recently dropped $33.40, or 2%, to $1,630 a troy ounce. Silver plunged $34.10, or 2.1%, to $29.89 a troy ounce.

On the economic front, import prices climbed for the first time since July in November, led by a 3.6% jump in the cost to import petroleum prices. Overall, import prices rose 0.7%, a smaller gain than the 0.9% increase economists expected, while import prices gained 0.1%, also slimmer than the 0.3% forecast. As compared to last year, import prices have soared 9.9%, while export prices have risen 4.7%.

Investors bought U.S. Treasuries, knocking yields lower. The benchmark 10-year note yields 1.965% from 1.969%.

Foreign Markets 

European blue chips fell 1.5%, the English FTSE 100 dipped 1.1% to 5,430 and the German DAX fell 1.4% to 5,696.

In Asia, the Japanese Nikkei 225 slipped 0.39% to 8,519 and the Chinese Hang Seng slumped 0.5% to 5,696.

What do you think?

Click the button below to comment on this article.