Fiscal Cliff Worries Weigh Down US Stock Futures

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Traders work on the floor of the New York Stock Exchange
Traders work on the floor of the New York Stock Exchange, August 16, 2010.

 

The U.S. stock index futures point to a lower open Tuesday as investors are expected to be watchful amid fears about the looming fiscal cliff, which consists of tax increases and spending cuts, at the beginning of next year.

The futures on the Dow Jones Industrial Average were down 0.52 percent, the futures on the Standard & Poor's 500 Index were down 0.74 percent and those on the Nasdaq 100 Index were down 0.62 percent.

On Monday, the U.S. stocks changed only marginally with volume of trading being thin as investors were guarded with concerns that President Barack Obama would face the colossal task of resolving the fiscal cliff.

“In the US there appeared to be some traction towards resolving the fiscal cliff, with a Senior Republican economist indicating that Congress should agree on higher taxes for the wealthy ahead of formal discussions on averting the fiscal beginning on Friday,” Credit Agricole said in a note.

Investors were also focused on the meeting among finance ministers of the euro zone countries in Brussels Monday.  But the meeting disappointed as it did not result in an agreement to deliver Greece its next loan tranche from the European Central Bank.    

The Dow Jones Industrial Average was flat, the S&P 500 Index was up 0.01 percent and the Nasdaq Composite Index fell 0.02 percent.

European markets fell Tuesday as investor sentiment remained negative with the persisting concerns that more time was needed for the ECB to release the next tranche of bailout package for Greece. London's FTSE 100 was down 36.86 points, Germany's DAX 30 index fell 54.30 points and France's CAC 40 declined 30.41 points.

Asian stocks fell Tuesday as investor sentiment was weighed down to find that Japan’s industrial output declined in September compared to that in the previous month, indicating that the weak global demand was continuing to have its impact on the country’s economy.

According to the data released Tuesday by the Ministry of Economy, Trade and Industry, Japan’s industrial production, which measures the change in the total inflation-adjusted value of output produced by manufacturers, mines and utilities, fell 4.1 percent in September compared to that in the previous month while it declined 4.1 percent in August.

Hong Kong’s Hang Seng Index fell 187.09 points, Japan’s Nikkei was down 15.39 points and South Korea’s Kospi Composite Index declined 11.17 points.

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