New York - US stock index futures fell on Thursday, putting the S&P 500 on track for its first daily back-to-back declines in a month, amid investor concerns the US Federal Reserve may begin to taper its stimulus measures and over weak data in China.
The S&P 500 posted its biggest decline in three weeks on Wednesday, after minutes from the latest US Federal Reserve meeting showed some officials were open to tapering large-scale asset purchases as early as at the June meeting.
The minutes came in the wake of comments earlier in the session by Fed Chairman Ben Bernanke, who said the Fed could scale back the pace of its bond purchases at one of the “next few meetings” if the economic recovery looked set to maintain forward momentum.
Adding to selling pressure, China's flash HSBC Purchasing Managers' Index for May fell to 49.6, slipping under the 50-point level which indicates expansion for the first time since October. That raised concerns the recovery in the world's second-largest economy has stalled and a sharper downturn may be on the horizon.
“With new fears of easy money ending, investors are taking a pause to evaluate the situation,” said Andre Bakhos, director of market analytics at Lek Securities in New York.
“This, coupled with weakening Chinese manufacturing numbers, has given investors a tangible reason to step back.”
Separately, data in Europe showed that while the downturn across euro zone businesses eased slightly in May, the bloc's economy is likely to contract again in the second quarter.
Investors will eye initial jobless claims data, due out at 8:30 a.m. EDT (14:30 SA time), for signs of traction in the labor market.
Economists in a Reuters survey forecast a total of 345,000 new filings after claims unexpectedly jumped by 360,000 in the prior week.
The benchmark S&P index has jumped 16.1 percent since the start of the year, boosted by slowly improving US economic data and stimulus measures by central banks around the globe.
S&P 500 futures dropped 14.2 points and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract.
Dow Jones industrial average futures lost 101 points, and Nasdaq 100 futures slumped 25.5 points.
Later in the session at 10:00 a.m. EDT (16:00 SA time), housing market data will be released, in the form of the Federal Housing Finance Agency's home price index for March and new home sales for April.
Economists in a Reuters survey forecast new home sales to show a total of 425,000 annualised units compared with 417,000 in March.
Hewlett-Packard Co jumped 11.6 percent to $23.69 in premarket trade after the computer maker raised its 2013 earnings outlook after quarterly results beat low expectations.
Hormel Foods Corp reported a lower quarterly profit due to costs related to its Skippy acquisition, and higher grain costs and lower turkey meat prices at its Jennie-O Turkey stores.
Title insurer Fidelity National Financial Inc and buyout firm Thomas H. Lee Partners are in advanced talks to acquire mortgage service provider Lender Processing Services Inc , a source familiar with the matter said.
European and Asian shares dropped and the Euro STOXX 50 Volatility Index surged 18 percent to a 3-week high, spooked by concerns about the future of the Fed's stimulus program and compounded by weak economic data from China. - Reuters