US stock index futures signal drop as car bailout fails
* U.S. stock index futures pointed to a drop in early trade on Wall Street after the U.S. Senate failed to approve a rescue plan for the ailing auto industry and Bank of America unveiled massive job cuts. * At 0902 GMT S&P 500 March futures, Dow Jones futures and Nasdaq 100 futures were down 2.9 to 3.6 percent. * Bank of America Corp said on Thursday it plans to eliminate 30,000 to 35,000 jobs over three years, reflecting its pending purchase of Merrill Lynch & Co and weaker business activity stemming from the economic recession. * Bank of America’s shares traded in Frankfurt were down 8.4 percent. * General Motors shares traded in Frankfurt were down 28 percent, while Ford shares traded in Frankfurt dropped 11 percent. * GM and Chrysler LLC have warned of potential collapse if they did not receive a bailout. They both said that in the face of their cash crises, they had hired outside advisers to help them explore possible bankruptcy, which they found had too many drawbacks. * The European auto sector also came under pressure on the news of the failed bailout bid, with the DJ Stoxx European auto index down 4 percent, Daimler losing 6.6
percent and Michelin off 5 percent, while shares of Japanese carmakers Toyota Motor Corp and Nissan sank 10-11.5 percent in Tokyo overnight. * Economic data expected on Friday includes retail sales for November, the producer price index numbers, business inventories and consumer sentiment.
No major company is due to report results. * U.S. retail sales fell sharply in November, said economists polled by Reuters, as the U.S. job market worsened and consumers became cautious spenders, while sliding petroleum prices and a slumping global economy probably caused producer prices to fall last month, economists predicted in a Reuters poll. * Tech shares will be in the spotlight after Alcatel-Lucent gave a pessimistic forecast for the overall 2009 telecoms equipment market, sending its shares down 6 percent. (Reporting by Blaise Robinson; Editing by Hans Peters) Keywords: MARKETS STOCKS US EUROPE (blaise.robinson@reuters.com ; +33 1 4949 5269, Reuters Messaging: blaise.robinson.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2008. All rights reserved.
source: http://www.cnbc.com/id/28190665/site/14081545/for/cnbc/
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