Futures Fall as European Growth Outlook Weakens

NEW YORK ( TheStreet) -- U.S. stock futures pointed to a lower open Thursday after the European Central Bank lowered it growth forecast for the eurozone and as investors awaited speeches by President Obama and Ben Bernanke.

Futures for the Dow Jones Industrial Average were down 65 points, or 56 points below fair value, at 11,406. Futures for the S&P 500 were down 8 points, or 7 points below fair value, at 1198, and Nasdaq futures were falling 8 points, or 10 points below fair value, at 2214.

In the U.S. market Wednesday, stocks had snapped three days of heavy selling to post the first gains in September, with the Dow surging some 270 points.

On Thursday, the European Central Bank, like the Bank of England, kept interest rates steady. The bank lowered its GDP growth projection to a range of 1.4% to 1.8% for 2011, down from its prior estimate of 1.5% to 2.3%. Economic growth for 2012 was also lowered.

The number of people seeking first-time unemployment benefits rose unexpectedly by 2,000 to 414,000 for the week ended Sept. 3, according to the Labor Department. Economists had been looking for a drop in claims to 405,000 from a revised 412,000 in the prior week.

Also this morning, the Commerce Department reported that the U.S. trade gap narrowed in July to $44.81 billion. Record high exports and lower oil prices, which resulted in lower imports, led to the largest decline in the trade deficit in almost two and a half years. Economists had expected the gap to narrow $51.5 billion, just slightly lower than $51.57 billion in June.

Investors are hopeful that President Obama will announce a jobs strategy to spur economic growth in his speech at 7 p.m. Obama is expected to present Congress with a $300 billion package that includes tax cuts, infrastructure spending and aid to local governments. Whether he can get the approval needed from Republicans to pass such a plan it still uncertain.

Meanwhile, speculation has been swirling that the U.S. Federal Reserve is considering a "maturity extension" plan for its portfolio that would decrease long-term interest rates. Bernanke is expected to say that the Fed is considering monetary easing options at his 1 p.m. speech in Minneapolis.

Additional Fed stimulus, if it does come, is not expected to be announced until the central bank's next meeting in late September, but nevertheless, investors will be parsing Bernanke's words.

The FTSE in London was losing 0.6%, and the DAX in Frankfurt was off 0.8%. In Asia, markets closed mixed, with Hong Kong's Hang Seng losing 0.67% and Japan's Nikkei up 0.34%
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"Investors are trying to decide whether they should surrender to attractive valuations and buy into a market that may be propelled by the President's jobs speech and the prospect of additional quantitative easing, or, if by doing so, they would only be responding to a siren call as the U.S. ultimately heads into recession on the heels of a renewed price decline," wrote Standard & Poor's investment strategist Sam Stovall.

At 3 p.m., consumer credit is expected to decrease from $15.5 billion in June to $5 billion in July.

Gold for December delivery was gaining $41.50 to trade at $1,859 ounce.

The October crude oil contract was slipping by 38 cents to trade at $88.96 a barrel.

The benchmark 10-year Treasury was gaining 13/32, diluting the yield to 2.01%. The dollar was strengthening against a basket of currencies, with the dollar index gaining 0.2%.

In corporate news, Caliper Life Sciences ( CALP), a provider of imaging and detection solutions for life sciences research, is being bought by scientific instruments provider PerkinElmer ( PKI) for about $600 million. Shares were surging 41.3% to $10.44 in premarket trading Thursday.

Homebuilder Hovnanian Enterprises ( HOV) reported a third-quarter loss of 47 cents a share, narrower than the loss of 50 cents a share that analysts, on average, were expecting. Shares were gaining 4.9% to $1.73.

-- Written by Chao Deng in New York.

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