Futures sink on growth worry ahead of data
Stock index futures sank on Thursday as a gloomy forecast on global growth and continuing worries about the European debt crisis shook up investors ahead of data on jobless claims and consumer prices.
Traders held on to the view that European policymakers were not doing enough to tackle the euro zone's debt crisis. European blue chips were down 2.6 percent, with banks among the biggest losers. For details, see
Sectors closely linked to growth, like miners and construction, were also hit hard, though the decline was broad-based.
Concern about the outlook for the global economy was underscored by a Morgan Stanley note cutting its 2011 and 2012 global gross domestic product estimates. It cut its 2011 global GDP forecast to 3.9 percent from 4.2 percent, and its 2012 view to 3.8 percent from 4.5 percent.
S&P 500 futures fell 20.3 points and were sharply below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration of the contract. Dow Jones industrial average futures lost 161 points, and Nasdaq 100 futures dropped 42.25 points.
Investors braced for a raft of economic data, including weekly jobless claims, the consumer price index (CPI), existing home sales and the Philadelphia Fed's business activity index.
Data on first-time applications for unemployment insurance was due at 8:30 a.m. EDT. Economists forecast a total of 400,000 filings, compared with 395,000 in the prior week.
July's CPI, also due at 8:30 a.m., was seen rising 0.2 percent, compared with a drop of 0.2 percent in June. Excluding food and energy items, CPI is expected to be up by 0.2 percent, compared with a June rise of 0.3 percent.
Hewlett-Packard Co, Gap Inc and Sears Holdings Corp were due to report quarterly results.
Technology shares fell on Wednesday after Dell Inc's disappointing sales outlook fanned worries that weak economic growth will hurt earnings in the third quarter.
(Reporting by Rodrigo Campos; editing by Jeffrey Benkoe)
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