Stock index futures fell about 1 percent on Wednesday as investors waited for key retail sales data for an indication of the mood of the U.S. consumer.

News from Europe also weighed on sentiment as top officials said an economic recovery would not come any time soon.

Retail sales are forecast to be flat in April, compared with a fall of 1.2 percent in the previous month. The data is due at 8:30 a.m. EDT. Consumer spending accounts for two-thirds of U.S. economic activity.

Expectations are up slightly, and people are looking for signs that there's some real improvement, not just leveling at the bottom, said Rick Meckler, president of investment firm LibertyView Capital Management in Jersey City, New Jersey.

The definition of 'better than expected' has been changing from not being horrible to actually showing some real improvement, he added, To the extent that sales show some real improvement it could be very positive for the market.

S&P 500 futures fell 7.5 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 shed 71 points, and Nasdaq 100 futures were off 16 points.

The British economy will recover more slowly than previously thought, the Bank of England said, sending the FTSE 100 <.FTSE> share index 1.1 percent lower and gold prices higher.

Also, German Chancellor Angela Merkel said she did not expect that economy to return to 2008 levels in 2010.

In other news from Europe, the European Commission imposed a record fine of 1.06 billion euros ($1.45 billion) on chipmaker Intel Corp on Wednesday and ordered it halt illegal rebates and other practices intended to squeeze out rival Advanced Micro Devices Inc.

The fine offset earlier optimism after Intel, the world's No. 1 chipmaker, said late Tuesday its orders and billing patterns have been slightly better than expected so far in the second quarter. Shares of Intel rose 2.3 percent to $15.57 in premarket trade.

Applied Materials Inc , the world's largest chip equipment maker, posted a quarterly loss Tuesday as cost cuts failed to fully offset a steep drop in revenue. Shares fell 2.6 percent to $11.18.

Department store operator Macy's Inc posted a loss of 16 cents a share excluding items and 21 cents including items. Reuters estimates had indicated a loss of 20 cents. Shares rose 2.7 percent to $12.68 in premarket trade.

On Tuesday, the Dow gained ground as investors scooped up defensive shares such as Pfizer Inc
, while energy stocks rose alongside oil prices. The S&P 500 was little changed, and the Nasdaq fell as financial and technology shares dropped after recent sharp gains.

The stock market has been digesting a series of secondary share offerings over the last few days as the companies sought to take advantage of increased investor confidence that pushed up stocks about 30 percent since the market hit a 12-year low in early March.

(Reporting by Edward Krudy; editing by Jeffrey Benkoe)