Stocks to open lower on stronger dollar

 @ibtimes
on December 17 2009 9:24 AM

Wall Street was set to open lower on Thursday as the Federal Reserve's growing optimism about the economy boosted the U.S. dollar to the detriment of equities, while FedEx shares fell as it forecast lower profit.

Stock index futures added slightly to losses after data showed an unexpected increase in weekly claims for unemployment insurance.

(The jobs data) is probably a non-event, even though the revised number went up. The dollar going up will be more important for the markets today, said Wayne Kaufman, chief market analyst at John Thomas Financial in New York.

S&P 500 futures fell 9.1 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 lost 69 points, and Nasdaq 100 futures shed 11.75 points.

Package delivery giant FedEx Corp, a bellwether for the economy, forecast third-quarter profit below expectations, sending shares down 3.7 percent to $86.60 in premarket trading.

Citigroup Inc slid 7.8 percent to $3.18 premarket after the bank's stock offering attracted weak demand and priced much lower than expected, prompting the U.S. Treasury to delay a plan to sell $5 billion of its stock in the bank.

The Fed voted Wednesday to keep interest rates at historic lows, but the U.S. dollar strengthened as the Fed said economic activity has continued to pick up.

The Fed also said it plans to shutter most of its emergency lending facilities on February 1, which may be tempering risk-taking as investors anticipate that easy money will soon diminish.

Growing concerns about Greece's fiscal health weighed on the euro and further lifted the greenback. The dollar index <.DXY> jumped 1 percent.

(Additional reporting by Ryan Vlastelica; editing by Jeffrey Benkoe)

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