Investing.com - U.S. stock futures were lower on Wednesday, after the Federal Reserve dampened expectations for further monetary easing while downbeat euro zone data and a weak Spanish debt auction added to concerns over the region’s economic outlook.
Ahead of the open, the Dow Jones Industrial Average futures pointed to a fall of 0.69%, S&P 500 futures signaled a 0.72% loss, while the Nasdaq 100 futures indicated a 0.63% decline.
Market sentiment was hit as the cost of insuring Spain’s debt against default climbed earlier after the country auctioned EUR2.59 billon of government bonds, short of the maximum targeted amount of EUR3.5 billion.
On Tuesday, Spain’s government announced that the country’s public debt will rise to a record 79.8% of gross domestic product this year.
Earlier Wednesday, data confirmed that the euro zone service sector contracted for the sixth time in seven months in March, increasing the likelihood that the economy has entered a technical recession.
In the U.S., the minutes of the Fed’s March meeting showed that policymakers will refrain from launching a third round of quantitative easing unless the rate of growth falters or inflation drops below the central bank’s 2% targeted rate.
General Electric Co was expected to be active after Moody's downgraded the ratings of the conglomerate and its finance unit General Electric Capital each by a notch, saying there were "material risks" associated with its funding model.
Meanwhile, energy companies were also slated to be in focus after a Brazilian federal prosecutor launched his second USD10.9 billion lawsuit against U.S. oil company Chevron and driller Transocean, in relation to an oil leak discovered on March 4 in a field northeast of Rio de Janeiro. Transocean shares plummeted 3.21% in pre-market trade.
In the financial sector, a federal judge rejected Bank of New York Mellon Corp's bid to dismiss a lawsuit by bondholders who invested in 26 trusts alleged to have contained risky mortgage loans from the former Countrywide Financial Corp. Shares in Bank of New York Mellon Corp were down 0.41% in after-hour trade.
Elsewhere, Groupon saw shares drop 0.80% after the world's largest online coupon website said it is being sued by a shareholder for misleading investors about its financial results and concealing weak internal controls.
Other stocks in focus included SanDisk Corp., the biggest maker of flash-memory cards, as it cut its forecast for first-quarter sales and profitability
.
Across the Atlantic, European stock markets were sharply lower. The EURO STOXX 50 tumbled 1.08%, France’s CAC 40 dropped 1.18%, Germany's DAX plummeted 1.76%, while Britain's FTSE 100 declined 1.17%.
During the Asian trading session, Australia’s ASX/200 Index dipped 0.1%, while Japan’s Nikkei 225 Index plunged 2.3%.
Also Wednesday, a report showed that euro zone retail sales fell by 0.1% in February, against expectations for a 0.1% increase and were 2.1% lower year-on-year.
Meanwhile, official data showed that German factory orders rose 0.3% in February, below expectations for a 1.2% increase, renewing concerns over the economic outlook for the bloc’s largest economy.
Later in the day, the U.S. was to produce industry data on non-farm employment change, as well as report by the Institute of Supply Management on service sector activity and government data on crude oil stockpiles.
Ahead of the open, the Dow Jones Industrial Average futures pointed to a fall of 0.69%, S&P 500 futures signaled a 0.72% loss, while the Nasdaq 100 futures indicated a 0.63% decline.
Market sentiment was hit as the cost of insuring Spain’s debt against default climbed earlier after the country auctioned EUR2.59 billon of government bonds, short of the maximum targeted amount of EUR3.5 billion.
On Tuesday, Spain’s government announced that the country’s public debt will rise to a record 79.8% of gross domestic product this year.
Earlier Wednesday, data confirmed that the euro zone service sector contracted for the sixth time in seven months in March, increasing the likelihood that the economy has entered a technical recession.
In the U.S., the minutes of the Fed’s March meeting showed that policymakers will refrain from launching a third round of quantitative easing unless the rate of growth falters or inflation drops below the central bank’s 2% targeted rate.
General Electric Co was expected to be active after Moody's downgraded the ratings of the conglomerate and its finance unit General Electric Capital each by a notch, saying there were "material risks" associated with its funding model.
Meanwhile, energy companies were also slated to be in focus after a Brazilian federal prosecutor launched his second USD10.9 billion lawsuit against U.S. oil company Chevron and driller Transocean, in relation to an oil leak discovered on March 4 in a field northeast of Rio de Janeiro. Transocean shares plummeted 3.21% in pre-market trade.
In the financial sector, a federal judge rejected Bank of New York Mellon Corp's bid to dismiss a lawsuit by bondholders who invested in 26 trusts alleged to have contained risky mortgage loans from the former Countrywide Financial Corp. Shares in Bank of New York Mellon Corp were down 0.41% in after-hour trade.
Elsewhere, Groupon saw shares drop 0.80% after the world's largest online coupon website said it is being sued by a shareholder for misleading investors about its financial results and concealing weak internal controls.
Other stocks in focus included SanDisk Corp., the biggest maker of flash-memory cards, as it cut its forecast for first-quarter sales and profitability
.
Across the Atlantic, European stock markets were sharply lower. The EURO STOXX 50 tumbled 1.08%, France’s CAC 40 dropped 1.18%, Germany's DAX plummeted 1.76%, while Britain's FTSE 100 declined 1.17%.
During the Asian trading session, Australia’s ASX/200 Index dipped 0.1%, while Japan’s Nikkei 225 Index plunged 2.3%.
Also Wednesday, a report showed that euro zone retail sales fell by 0.1% in February, against expectations for a 0.1% increase and were 2.1% lower year-on-year.
Meanwhile, official data showed that German factory orders rose 0.3% in February, below expectations for a 1.2% increase, renewing concerns over the economic outlook for the bloc’s largest economy.
Later in the day, the U.S. was to produce industry data on non-farm employment change, as well as report by the Institute of Supply Management on service sector activity and government data on crude oil stockpiles.