Stocks set to drop on eurozone fears

September 12, 2011: 8:21 AM ET

NEW YORK (CNNMoney) -- U.S. stocks were poised to take a hit Monday, following a sell-off in global markets sparked by fresh eurozone debt worries.

Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures were all more than 1% lower ahead of the opening bell. Stock futures indicate the possible direction of the markets when they open at 9:30 a.m. ET.

Investors were struggling with a new wave of anxiety over the possibility that Greece will default on its debts.

Adding to overseas jitters, France's top banks prepared themselves for a possible credit downgrade from ratings agency Moody's, according to Reuters. Traders expect the downgrade announcement to be issued at any moment as the 90-day window for the review comes to a close. The credit ratings agency issued the review on June 15.

Europe's debt crisis: 5 things you need to know

Stocks ended sharply lower Friday, as bad news out of Europe kept piling up. The sell-off triggered the sixth weekly decline in seven weeks for the Dow and S&P 500.

After the resignation of European Central Bank executive board member Jürgen Stark, investors grew increasingly concerned about a possible Greek default.

World markets plunge

A default has yet to materialize, but investors are clearly on edge as contagion fears tighten their grip on European markets.

World markets: European stocks were all sharply lower at midday. Britain's FTSE (UKX) 100 sank 2.6%, the DAX (DAX) in Germany plunged 3.6% and France's CAC (CAC40) 40 fell off 4.5%.

Asian markets ended lower. Tthe Hang Seng in Hong Kong (HSI) plunged 4.2% and Japan's Nikkei (N225) dropped 2.3%. Shanghai (SHCOMP) was closed for a market holiday.

Economy: President Obama will make a new pitch for his $447 billion job creation act from the Rose Garden Monday and then he will send the stimulus plan to Congress this evening.

Companies: Investors are awaiting Bank of America (BAC, Fortune 500) CEO Brian Moynihan's 9 a.m. ET presentation at the Barclays investors conference in New York for any insights into the bank's plans.

Paying for Obama's plan: It's complicated

Bank of America is reportedly increasing job cuts to 40,000 from the 30,000 previously reported. Shares were down 2.6% in premarket trade.

Other bank shares were also lower in premarket trading. Shares of Citigroup (C, Fortune 500) were down 3.1%, shares of JPMorgan Chase (JPM, Fortune 500) fell 2.2%, and shares of Goldman Sachs (GS, Fortune 500) were off by 1.2%.

Also, shares of NetLogic (NETL), a semiconductor company, surged more than 50% after Broadcom Corporation (BRCM, Fortune 500) agreed to purchase the company in a deal worth $3.7 billion. Shares of Broadcom sank more than 23%.

McGraw Hill Cos. (MHP, Fortune 500) agreed to split into two companies -- one focused on its education unit, and the other will combine Standard & Poor's, McGraw-Hill Financial and Business Information. Shares of McGraw-Hill rose nearly 3%.

Commodities and currencies: The dollar was basically flat against the British pound and the euro, but slipped against the Japanese yen.

Oil for October delivery slipped $1.50 to $85.74 a barrel.

Gold futures for December delivery fell $13.70 to $1,845.80 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury edged higher, pushing the yield down to 1.89%.  To top of page

Index Last Change % Change
Dow 32,627.97 -234.33 -0.71%
Nasdaq 13,215.24 99.07 0.76%
S&P 500 3,913.10 -2.36 -0.06%
Treasuries 1.73 0.00 0.12%
Data as of 6:29am ET
Company Price Change % Change
Ford Motor Co 8.29 0.05 0.61%
Advanced Micro Devic... 54.59 0.70 1.30%
Cisco Systems Inc 47.49 -2.44 -4.89%
General Electric Co 13.00 -0.16 -1.22%
Kraft Heinz Co 27.84 -2.20 -7.32%
Data as of 2:44pm ET
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.80%3.88%
15 yr fixed3.20%3.23%
5/1 ARM3.84%3.88%
30 yr refi3.82%3.93%
15 yr refi3.20%3.23%
Rate data provided
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