Stocks: Focus on Greece, growth and tech

@CNNMoneyInvest May 23, 2012: 8:57 AM ET
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NEW YORK (CNNMoney) -- U.S. stocks face a tough road Wednesday as investors worry about Greece leaving the eurozone and a slowdown in Asian economies. Technology stocks may come under pressure after Dell reported weak sales, sending its shares plunging nearly 13% in premarket trading.

Investors will continue to keep close tabs on Facebook (FB) and the unfolding saga. Investigators are looking into whether Morgan Stanley (MS, Fortune 500), the lead underwriter for Facebook's initial public offering last week, shared a negative assessment of the social network with major clients ahead of the IPO.

Shares of Facebook, which lost 18% from its IPO price in the first two days of trading this week, were up 1.8% in premarket trading.

Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures were 0.7% lower ahead of the opening bell. Stock futures indicate the possible direction of the markets when they open at 9:30 a.m. ET.

European leaders are due to meet in an ad hoc summit to address the latest problems with European sovereign debt, amid growing worries that Greece is moving closer to dropping the euro and what the contagion effects an exit might have on other economies.

Former Greek prime minister Lucas Papademos told Dow Jones Newswires late Tuesday that Greece is considering preparations to leave the eurozone.

Adding further pressure on world markets, the World Bank cut its growth estimates for growth in the Asia-Pacific region, including China. It now forecasts a growth of 7.6% this year -- down from 8.2% in 2011, and 10% as recently as 2010.

On the domestic front, weak earnings, sales and guidance from Dell (DELL, Fortune 500) late Tuesday sparked a sell-off in its shares, as well as shares of rival Hewlett Packard (HPQ, Fortune 500). HP is set to report its own results after the bell Wednesday, when it is expected to also announce deep staff cuts.

The computer and printer maker is also widely expect to announce mass layoffs along with its report.

U.S. stocks ended flat Tuesday, turning lower during the final hour of trading on reports about Greece's preparations to leave the eurozone.

World markets: European stocks were sharply lower in morning trading. Britain's FTSE 100 (UKX) tumbled nearly 2.0%, while France's CAC 40 (CAC40) lost 2.3%. The DAX (DAX) in Germany lost 1.9%.

Asian markets ended lower following the World Bank's cut on growth forecasts. The Shanghai Composite (SHCOMP) slipped 0.4%, while the Hang Seng (HSI) in Hong Kong lost 1.3% and Japan's Nikkei (N225) tumbled nearly 2%.

Companies: Automaker Ford Motor (F, Fortune 500) had its debt upgraded out of junk bond status by Moody's late Tuesday -- an important benchmark for the automaker that will lower its borrowing costs, and allow it to reclaim collateral it put up for a credit line. Shares of Ford gained 0.7% in heavy premarket trading.

Homebuilder Toll Brothers (TOL) reported better-than-expected earnings and revenue that was in line with forecasts. It also upped its guidance for the second quarter. The company said that in some regions of the country it has shifted from a buyer's to a seller's market. Still shares of Toll Brothers (TOL) slipped 0.1% in premarket trading.

Shares of Hormel (HRL, Fortune 500) gained 4% in heavy premarket trading, after the meat and food company reported a better-than-expected gain in earnings.

Financial stocks were under pressure early Wednesday, with shares of JPMorgan Chase (JPM, Fortune 500), Bank of America (BAC, Fortune 500) and Citigroup (C, Fortune 500) all down more than 1% premarket.

Economy: New home sales for the month of April are expected to come in at an annual rate of 339,000, up from 328,000 in the month prior. The 10 a.m. ET report follows a strong report on sales of existing homes Tuesday, in which sales climbed 10%.

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

Oil for July delivery slipped 74 cents to $91.14 a barrel. Officials from six world powers are due to hold talks with Iran in Baghdad on Wednesday about its nuclear program, raising hopes that there might be an deal that would end sanctions against Iran.

Gold futures for June delivery tumbled $16.40 to $1,560.20 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury was slightly higher, knocking the yield down to 1.74% fro 1.79% Tuesday.  To top of page

Index Last Change % Change
Dow 16,380.41 263.17 1.63%
Nasdaq 4,258.44 41.05 0.97%
S&P 500 1,886.76 24.00 1.29%
Treasuries 2.20 0.05 2.14%
Data as of 6:28am ET
Company Price Change % Change
Bank of America Corp... 16.21 0.13 0.81%
General Electric Co 24.82 0.57 2.35%
Microsoft Corp 43.63 0.89 2.08%
Alcoa Inc 15.62 1.02 6.99%
Pfizer Inc 27.83 0.13 0.47%
Data as of Oct 17
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15 yr fixed3.05%3.11%
5/1 ARM3.71%3.19%
30 yr refi4.03%4.19%
15 yr refi3.11%3.17%
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