U.S. stock-index futures fell sharply today as a global bond rout and continuing worries on Greece's perilous financial situation weighed on the market.
Futures for the Dow Jones Industrial Average dropped 0.7 percent to 17,916, and those for the S&P 500 fell 0.7 percent to 2,084. Nasdaq futures were down 0.8 percent at 4,396.
U.S. bond prices may see another fall following the battering European bonds were taking today. U.S. bond yields yesterday hit their highest level since early December. The yield on the 10-year Treasury note, the benchmark for global borrowing costs, yesterday climbed to 2.267 percent, MarketWatch reported, citing Tradeweb.
Elevated U.S. yields mean higher corporate borrowing costs, which could hit shares across the world.
Investors have also been worried that Greece could run out of cash. Euro zone finance ministers, who met yesterday, acknowledged progress in talks between Greece and its creditors but said more work was needed to close a cash-for-reforms deal.
DATA:
Economic reports include the 9 a.m. release of a small-business optimism index by the National Federation of Independent Business.
At 10 a.m., the Labor Department is scheduled to release figures on March job openings.
The Federal Reserve’s report on first-quarter household debt and credit is slated for release at 11 a.m.
MOVERS:
AOL (NYSE:AOL) jumped 17.9 percent in premarket trade after the company agreed to be bought by Verizon communications (NYSE:VZ) in a deal valued at $4.4 billion. Verizon expects to fund the purchase with cash on hand and commercial paper. Verizon’s stock slipped 0.4 percent in premarket trade.
Gap (NYSE:GPS) dropped more than 3.6 percent after the clothing retailer’s first-quarter revenue missed analysts’ estimates.
Hilton Worldwide (NYSE:HLT) may be active after Blackstone cut its stake below 50 percent in the hotel operator.
ADRs of YY (NASDAQ:YY) slumps 7.9 percent to $68.97 after brokerages cut price targets on the video streaming website operator's stock.
International Flavors & Fragrances (NYSE:IFF) may be active after saying first-quarter profit rose 20 percent, despite the strong dollar’s impact on sales.
COMMODITIES:
Oil prices shot higher as the dollar dropped. Brent crude for delivery in June surged 2 percent to $66.38 a barrel on London’s ICE Futures exchange. On the New York Mercantile Exchange, June-dated light, sweet crude futures traded at $60.26 a barrel, up 1.7 percent.
Spot gold rose to a session high of $1,196.60 an ounce and was trading up 0.9 percent at $1,194.10 by 7:31 a.m., while U.S. gold futures for June delivery were up $10.50 at $1,193.50 an ounce.
OTHER MARKETS:
In Europe, the Stoxx 600 stumbled 1.6 percent. Greece worries intensified after the country’s finance minister said it may run out of cash in two weeks. In Asia, the Shanghai Composite fell 1.1 percent, but Japan’s Nikkei Average edged up about 4 points.