U.S. Stocks Head for Sharply Lower Open
Thursday August 9, 8:25 am ET
By Tim Paradis, AP Business Writer
U.S. Stocks Move Toward Sharply Lower Open Following Renewed Subprime Concerns
NEW YORK (AP) -- U.S. stocks headed for a sharply lower open Thursday after a French bank said it was freezing three of its asset-backed securities funds that have had struggled to find liquidity in the U.S. subprime mortgage market.
Bonds rose, with the yield on the benchmark 10-year Treasury note falling to 4.78 percent from 4.89 percent late Wednesday. Bond prices move opposite yields.
The announcement by BNP Paribas sent European stock markets lower and stirred concerns that problems among subprime borrowers, those with weak credit, would further roil Wall Street. While stocks had managed to rally this week, investors have seen wide swings in stocks as investors have worried about not only subprime markets but also about the tightening of credit.
Stock futures came off of their lows but were still down sharply after the European Central Bank said it would add liquidity to the continent's money markets to maintain "orderly conditions." Investors seeking cash from the markets earlier had sent European interest rates higher.
Dow Jones industrial average futures expiring in September, which had been down more than 130, were off 110, or 0.80 percent, at 13,595. Standard & Poor's 500 futures fell 13.90, or 0.92 percent, to 1,490.00. Nasdaq 100 futures fell 12.00, or 0.60 percent, to 1,397.25.
New York Stock Exchange: nyse.com
Nasdaq Stock Market: nasdaq.com
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