Stock Futures Fall Following G20 Meeting
NEW YORK (TheStreet) -- U.S futures signaled that stocks would follow European equities lower Monday after countries of the G20 held back on providing more financial firepower to the eurozone.
Futures for the Dow Jones Industrial Average were down 50 points, or 54 points below fair value, at 12,911. Futures for the S&P 500 were down 6.9 points, or 7.6 points below fair value, at 1356. Futures for the Nasdaq were down 11.3 points, or 13.7 points below fair value, at 2591.
Stocks were headed for losses after a low-volume rally last week that saw the S&P 500 gain 0.3% and the Dow fail to close above 13,000. In the period through Feb. 21, trading of S&P 500 component shares has fallen 20% compared to that in the same period last year, according to Deutsche Bank.
Buying momentum has been weak with the S&P 500 up 8.6% year-to-date. "This February's gain is the best since 1998, and the best year-to-date rise since 1991," noted Sam Stovall, chief equity strategist with S&P Capital IQ.The Group of 20 countries rebuffed calls to boost the eurozone's resources. In a weekend meeting, the G20 said Europe must ramp up money to fight the debt crisis before leading economies will provide more funds to the International Monetary Fund. The G20 is moving to create $2 trillion in resources -- with $1 trillion from Europe's temporary and permanent bailout funds and as much as $500 billion for the IMF from countries like Japan and China, adding to the current $385 billion in funds. The effort to increase the region's firepower would be the G20's greatest since the countries put $1 trillion into Europe three years ago to fight the recession. This comes as Greece is on track to receive its second bailout from European creditors and amid ongoing concern for core economies like Italy and Spain. This afternoon, Germany's parliament is expected to pass a parliamentary vote on Greece's aid package. Germany's DAX was down 1.2% while London's FTSE was falling 1% on Monday. Japan's Nikkei Average settled down 0.14% and Hong Kong's Hang Seng closed off 0.9%. U.S. economic data are light on Monday. Pending home sales from the National Association of Realtors will kick off the week's calendar at 10 a.m. EST. Sales are expected to have risen 1% in January, according to Thomson Reuters, following a 3.5% drop in December. Investors are also expecting a smattering of manufacturing reports from regional Federal Reserve branches, kicking off with the Dallas Fed Manufacturing Survey at 10:30 a.m.
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