US futures head lower on more gloom from Europe

AP News
Posted: Sep 24, 2012 9:07 AM
US futures head lower on more gloom from Europe

NEW YORK (AP) — Stock futures slid Monday as investors, with few indicators from the U.S., pored over more gloomy economic data out of Europe.

Dow Jones industrial futures fell 48 points to 13,452. The broader S&P futures slipped 5.9 points to 1,446. Nasdaq futures gave up 17.25 points to 2,835.25.

Global markets have been buoyed by the latest government efforts in the U.S., Europe and Japan to kick-start growth. However, economic indicators are beginning to overshadow the potential for success by the central banks.

On Monday, Germany's Ifo index of business confidence fell for a fifth consecutive month, revealing the headwinds faced by even Europe's biggest and strongest economy. The Ifo index dipped to 101.4 in September from 102.3 in August. The report was troublesome to many because economists had expected the index to remain at least flat.

Like the U.S., the concern is that a strong economy that is on the rebound in Germany will be weighed down by the rest of the European Union, half of whose members have already entered into recession.

Germany's economy grew 0.3 percent in the second quarter from the previous quarter, but a number of economists now believe the country is heading for a recession in the second half of the year.

Investors in the U.S. will certainly be looking for more good news from the U.S. housing market, which appears to be bouncing back after being a stuck in a rut for years.

Before the latest data on new and pending home sales is released later in the week, Lennar on Monday became the latest builder to post surprisingly strong earnings.

A rise in new orders and the number of homes delivered, in adding to a big tax benefit, had the Miami homebuilder quadrupling profits. KB Home on Friday did almost as well, and housing shares jumped on optimistic comments from its CEO, Stuart Miller.

Before the market opened Monday, shares of homebuilders were on the rise.