Stocks: Worries about Europe resurface

@CNNMoneyInvest April 5, 2012: 8:59 AM ET
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NEW YORK (CNNMoney) -- U.S. stocks were headed for a weak open Thursday, taking their cue from world markets on the final trading session of the week, as worries about the European debt crisis bubbled up.

Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures were down between 0.2% to 0.4% ahead of the opening bell. Stock futures indicate the possible direction of the markets when they open at 9:30 a.m. ET.

A lukewarm Spanish debt auction Wednesday resurfaced concerns about the country's ability to meet its 2012 budget deficit target. The yield on 10-year Spanish bonds jumped to 5.8% Thursday, marking the highest level in more than three months.

French 10-year bond yields also climbed, edging up to 2.96% Thursday, following auctions for mid- to long-term debt that drew decent demand.

Bruce McCain, the chief investment strategist at Key Private Bank in Cleveland, said anxieties about Europe were responsible for "a big part" of Thursday's pullback in world markets and U.S. stock futures, as investors realize their overconfidence following the Greek bailout last month.

"It's in the nature for humans to look for the resolution, and there is just no resolution to Europe," McCain said. "It's a series of crises and simply a matter of surviving the immediate crisis and getting a breather until you move onto the next one, and now we've moved on to that next one."

"Until you solve the underlying problem, you're not going to get out of that loop," he added.

The U.S. labor market is also in focus Thursday, with new reports on initial jobless claims and planned job cuts. In addition, a number of retailers reported same-store sales Thursday morning.

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Stocks fell for a second straight day Wednesday, as eurozone debt worries resurfaced and investors continue to ponder what the markets might look like without additional stimulus from the Federal Reserve.

U.S. markets will be closed Friday in observance of Good Friday, and bond markets will close early.

World markets: European stocks were lower in morning trading. Britain's FTSE 100 (UKX) slipped 0.5%, the DAX (DAX) in Germany lost 1.0%, and France's CAC 40 (CAC40) shed 0.5%.

Asian markets ended mixed. Japan's Nikkei (N225) slid 0.5% and Hong Kong's Hang Seng (HSI) fell 1%, while the Shanghai Composite (SHCOMP) rose 1.7%.

Economy: Initial jobless claims for the week ended March 31 totaled 357,000, the government reported before Thursday's open, compared with analyst expectations of 355,000.

Outplacement firm Challenger, Gray & Christmas said planned job cuts declined to roughly 38,000 in March, the lowest since May of last year.

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Companies: Shares of wine company Constellation Brands (STZ) fell 9% in premarket trading Thursday, after the company reported a drop in revenue and weak guidance for the upcoming fiscal year.

Pier 1 Imports (PIR) and Carmax (KMX, Fortune 500) reported earnings and revenue roughly in line with analyst expectations.

Macy's (M, Fortune 500) shares rose 1.5% ahead of the open, after the company reported that its same-store for the month of March had increased 7%. Fellow retailer Bed Bath & Beyond (BBBY, Fortune 500) gained 5% after announcing a 7% increase in quarterly same-store sales.

Clothing sellers Gap Inc (GPS, Fortune 500) and TJX Companies Inc (TJX, Fortune 500) were up 2.1% and 1.9%, respectively, also on strong same-store sales.

Costco (COST, Fortune 500)'s same-store sales for March in the U.S. increased by 6%. Limited (LTD, Fortune 500) said its March store sales increased 8%.

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Currencies and commodities: The dollar gained against the euro and the British pound, but slipped against the Japanese yen.

Oil for May delivery rose 14 cents to $101.61 a barrel.

Gold futures for April delivery rose $12.30 to $1,624.60 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury rose, pushing the yield down to 2.17% from 2.23% late Wednesday. To top of page

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