Stock futures pulled lower by copper, China worries

March 12, 2014

New York (Mar 12)   Persistent worries over slowing Chinese growth and simmering tensions over Ukraine overshadowed markets on Wednesday, with stock futures veering south after sharp losses out of Hong Kong and Tokyo started to repeat in Europe.

While gold rose on falling stock prices, China worries were crushing copper prices once again and crude-oil prices were also down sharply.

Futures for the S&P 500 index fell 3.7 points to 1,861.50, while those for the Dow Jones Industrial Average   dropped 27 points to 16,309. Futures for the Nasdaq 100 index /quotes/zigman/13031259/realtime NDH4 -0.27%  shed about 10 points to 3,678.75.

Wall Street stocks finished lower in a choppy session on Tuesday, with the S&P 500  ending the day 9.55 points, or 0.5%, lower at 1,867.62, retreating from a record closing level reached on Friday.

The data calendar for Wednesday is empty, which means investors are likely to look elsewhere for direction. Economic uncertainty out of China, amid lingering fears over a much-weaker-than-expected fall in exports over the weekend, was riding a 1.7% drop for April crude  and a 0.6% fall for May copper  HGK4 -0.22%

A local Chinese-newspaper report overnight indicated China’s central bank may respond to slowing loan demand by pumping more money into its banking system.

Shanghai trouble, copper plunges anew

Adding to worries, Shanghai-listed Baoding Tianwei Baobian Electric Co. /quotes/zigman/1867148/realtime CN:600550 -6.74% , a power-equipment manufacturer for the new energy sector, slid 5.1% as its corporate bond was suspended for a second day. The company posted a full-year net loss for the second consecutive year, which led to a de-listing warning. That comes on the heels of a Chinese solar-equipment maker, Shanghai Chaori Solar Energy Science & Technology, that failed last Friday to meet interest payments on a bond. /quotes/zigman/678457/realtime HGK4 -0.22%.

On Wednesday, Hong Kong’s Hang Seng index slid 1.7%, while the Nikkei 225 index   dropped 2.6% as the yen strengthened against the dollar  USDJPY -0.35% . Losses intensified in Europe, where the Stoxx Europe 600 index  fell 1.1%.

Investors are also concerned that political tensions between Russia and Ukraine will intensify as the March 16 referendum on whether Crimea should belong to Russia draws near. The U.S. and Europe are readying sanctions against Russia, The Wall Street Journal reported. The Russian MICEX index XX:MICEXINDEXCF -2.29%  tumbled 1.6% in Moscow.

Source: MarketWatch

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