Stock futures hit by euro zone, Dell concerns

Wed May 23, 2012 8:18am EDT
 
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By Angela Moon

NEW YORK (Reuters) - Stock index futures fell on Wednesday as caution prevailed ahead of a meeting of European leaders and on mounting concerns over Greece's future in the euro zone.

A weaker-than-expected revenue forecast from computer maker Dell also weighed on investor sentiment.

Leaders of the 27 EU countries are to meet in Brussels later in the day for a summit expected to deal with Europe's economic woes but also ways to prevent debt-mired Greece from skidding into a chaotic bankruptcy. The leaders are to consider ways to generate growth and discuss the idea of regional bonds to be jointly underwritten by all euro zone member states. However, Germany has already reiterated its opposition to such a move.

Dell Inc shares fell 13 percent to $13.10 in premarket trade, a day after the company forecast disappointing second-quarter revenue as U.S. and European corporate tech spending weakens and consumer personal computer sales continue to shrink.

Fears that Greece may have to leave the euro grew after Dow Jones earlier quoted former prime minister Lucas Papademos as saying Greece had no choice but to stick with a painful austerity program or face a damaging exit from the euro zone. His clarification in a television interview later offered little respite.

The "ex-Greek PM was just stating the obvious to anyone paying attention over the past month since the election. He doesn't want Greece leave but it could happen and it would be ugly if it did," said Peter Boockvar, equity strategist at Miller Tabak + Co in New York.

"This said, the markets are on edge and sensitive to every possible out of control scenario coming out of Europe."

Facebook Inc will also be eyed, after sources said that while company officials traveled the country to talk up the company's $16 billion initial public offering, the social networking giant advised analysts for underwriters to reduce revenue and earnings forecasts. The stock was up 0.8 percent to $31.20 in premarket trade.   Continued...

 
Traders work on the floor of the New York Stock Exchange May 7, 2012. REUTERS/Brendan McDermid