Futures slump in the midst of a global selloff

AP News
Posted: Jun 13, 2013 9:08 AM
Futures slump in the midst of a global selloff

NEW YORK (AP) — U.S. stock futures slumped Thursday as selloffs in Asia and Europe overshadowed positive reports in the U.S. on jobs and retail sales.

Cited repeatedly as the cause for this week's heavy declines is uncertainty about how central banks will ease out of the markets that they helped to prop up during the worst of the economic crisis.

Dow Jones industrial futures fell 31 points to 14,947. The broader S&P futures slipped 4 points to 1,612.52. Nasdaq futures fell 4.5 points to 2,915.75.

The number of Americans seeking unemployment benefits fell 12,000 last week to a seasonally adjusted 334,000, the Labor Department said Thursday. Weekly jobs numbers are volatile, but the four week average dropped as well and hiring is holding up.

There were 175,000 jobs added last month and with the improving jobs landscape, people are again spending. Consumer spending drives about 70 percent of all economic activity in the U.S., making it a crucial aspect of a full economic recovery.

The Commerce Department reported Thursday that spending in retail stores last month hit the highest levels in three years.

In the face of higher taxes that kicked in to start the year, the report is encouraging.

Still, the positive data in the U.S. was not enough to turn futures markets around in the U.S., which followed global markets downward.

Investors in Japan began the rout, bailing out of the Nikkei and sending the index plunging more than 6 percent. That puts the Nikkei in solid bear territory. Markets in China plunged in the first day of trading after a three-day holiday.

The huge losses in Japan and China spread across Asia, rattling smaller markets, and then jumped to Europe and the United States.