The euro fell again, and continues to hover near a four-year low. The currency, used by 16 countries in Europe, has become a key indicator of confidence in the continent's ability to contain growing debt problems in countries like Greece, Portugal and Spain. The euro fell to $1.2329, a day after touching a four-year low of $1.2146.
Such a stark change in views has spooked investors, and the euro is now largely driving stock trading. Major European indexes gave up their morning gains and are now sharply lower after the euro retreated.
Greek workers are again in the streets protesting recently approved budget cuts that were necessary for the country to receive a bailout. Greece was able to repay debt that came due Wednesday only because it had access to a rescue package from the European Union and International Monetary Fund.
Ahead of the opening bell, Dow Jones industrial average futures fell 158 to 10,247. Standard & Poor's 500 index futures fell 21.20 to 1,088.70, while Nasdaq 100 index futures dropped 38.25 to 1,830.00.
The S&P 500 is nearly 10 percent off its high for the year set last month. Such a drop is considered by many analysts to be a "correction" in the market. No corrections have occurred since stocks hit a 12-year low in March 2009.
As investors pulled out of stocks and other risky investments like oil, they moved into safer investments such as U.S. Treasurys.
In the U.S, investors were disappointed with the weekly jobs report.
The Labor Department said initial claims for jobless benefits rose by 25,000 to 471,000 last week. Economists polled by Thomson Reuters had forecast a slight drop to 440,000. It snapped a streak of four straight weekly declines and again calls into question the strength of the jobs market.
Weekly claims have been stuck around 450,000 since January, unable to break closer to the 425,000 range that is considered a sign that employers are regularly hiring new workers.
High unemployment remains one of the biggest obstacles to a sustained domestic recovery. Analysts say that the economy will only improve modestly until the unemployment rate drops sharply from its current level of 9.9 percent. |
