Stock futures drop on Greece fears, healthcare approval

 @ibtimes
on March 22 2010 8:00 AM

Stock index futures fell on Monday as the passage of sweeping healthcare reform and uncertainty over Greece's debt crisis revived investor risk aversion.

European leaders sent out conflicting signals over aid to Greece over the weekend, weighing on futures. Last week's surprise interest rate hike from India also heightened worries about global fiscal tightening.

The spotlight will be on shares in the pharmaceutical, healthcare and insurance sectors after the House of Representatives approved a healthcare overhaul bill, expanding insurance coverage to nearly all Americans and handing President Barack Obama a landmark victory.

The passage of the healthcare reform does raise a lot of questions, but long term it's probably not going to have a major impact on the markets, said Peter Cardillo, chief market economist at Avalon Partners in New York.

It's certainly a catalyst for a day or two, but I think most of it is already in the market.

Energy shares could be hurt as the price of oil futures fell 1.7 percent to below $80 a barrel on worries over Greece's debt situation and ample oil supplies. Shares of Exxon Mobil Corp slipped 1 percent to $66.40 in thin premarket trade.

S&P 500 futures fell 8.2 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 fell 62 points, and Nasdaq 100 futures shed 11 points.

The Dow industrials snapped an eight-session winning streak Friday, as renewed worries about Greece sparked a climb in the dollar and weighed on equities.

Williams-Sonoma Inc climbed 4.6 percent to $25.25 after the retailer reported higher-than-expected quarterly profit on lower costs and strong holiday sales.

Tiffany & Co lost 4.8 percent to $45 after it posted fourth-quarter profit below expectations and forecast full-year earnings above estimates.

(Editing by Jeffrey Benkoe)

Share this article