European markets are called to open negative this morning.
Asian stocks fell, the cost of insuring the region’s debt rose to the highest in more than six months and the euro dropped to three-week lows versus the dollar and yen amid concern the European debt crisis is worsening.
The MSCI Asia Pacific Index sank 2.1 percent as of 3 p.m. in Tokyo, set for its steepest loss since May 23. Futures on the Standard & Poor’s 500 Index were little changed while those on the Euro Stoxx 50 Index decreased 0.9 percent. The euro slid 0.5 percent to $1.4113 and weakened 0.7 percent to 113.99 yen. The Markit iTraxx Asia index of 50 investment-grade borrowers outside Japan climbed 2.5 basis points. Oil rebounded from a four-month low. Copper and tin retreated for a second day.
U.S. stocks finished sharply lower Wednesday after gloomy manufacturing data and renewed fears aboout Greece’ debt problems sparked a sell-off.
The Dow Jones industrial average dropped 179 points, or 1.5%, with all 30 of blue-chip index’ stocks trading lower. Bank of America and JPMorgan Chase were among the biggest laggards.
Other financial stocks followed suit, with shares of Wells Fargo and Citigroup down about 2%.
The S&P 500 slipped 22 points, or 1.7%, with a 13% drop in shares of Owens-Illinois leading the decline. The glass container maker cut its earnings guidance, citing rising manufacturing costs.
The Nasdaq composite lost 47 points, or 1.8%. Baidu was among the worst performers on the tech-heavy index, with shares down almost 5%.
News that European officials failed to reach an agreement on bailing out Greece “continues to drive fear and cues the overall downtrend in the market,” said Ryan Detrick, senior technical strategist at Schaeffer’ Investment Research.
Wall Street’ most widely cited measure of volatility and fear, the VIX, spiked more than 16% to 21.32. But it’ still far below 30 — the level that’ thought to indicate investor fear.
Events this week
Thursday: Investors will get initial unemployment claims at 8:30 a.m. ET from the Labor Department, along with May housing starts and building permits data from the Commerce Department. Economists expect weekly claims will fall to 421,000 from last week’ reading of 427,000 claims.
The Federal Reserve Bank of Philadelphia will release its June manufacturing survey at 10 a.m. ET.
Supermarket chain owner Kroger will report results before the opening bell, with analysts expecting earnings of 64 cents per share.
Reporting results after the close will be BlackBerry maker Research in Motion, which is expected to have earned $1.32 a share.
Friday: The University of Michigan will release its initial June consumer sentiment index at 9:55 a.m. ET. Economists are looking for the index to fall to a reading of 73.5 from May’ reading of 74.3.