U.S. stock index futures are dropping today as a rout in Chinese markets deepened and as investors always keep a wary eye on developments in the Greek debt crisis.
Beijing unveiled yet another battery of measures to arrest the sell-off and the securities regulator warned of \”panic sentiment\” gripping investors in the world\’s second-largest economy. Growing concerns of a slowdown in China were reflected within the commodities markets, with copper prices falling to a six-year low. Oil prices, however, recovered slightly using their worst week in previous months.
More than 30 per cent has been pushed off the value of Chinese shares since mid-June, and for some global investors the worry that China\’s market turmoil will destabilize the actual economy is now a bigger risk compared to crisis in Greece.Eurozone members have given Greece until Sunday to generate convincing reform proposals in return for loans that will keep the country from crashing out of the single currency. With its banks closed, cash withdrawals rationed and the economy in freefall, Greece has not been closer to a total state bankruptcy that would probably force it to print an alternate currency and leave the euro.Statistics Canada says the entire value of building permits issued fell 14.5 percent to $6.7 billion in May, following two months of double-digit gains. The value of residential permits dropped 13.5 per cent to $3.9 billion in May, while Canadian municipalities issued non-residential building permits worth $2.8 billion in May, down 16.0 percent from April.Investors will also scrutinize the minutes from the U.S. Federal Reserve\’s June 16-17 meeting to ascertain if the storm clouds over Greece and China will have any impact on the timing and pace of the interest rate increase. The minutes are due at 2:00 p.m. ET.
San Francisco Fed President John Williams is scheduled to talk on the economic outlook prior to the International Conference of business Bank Economists later in the day.U.S. quarterly earnings season kicks off, with Alcoa reporting results following the close of markets. Corporate earnings are expected to have fallen 3.1 percent in the second quarter, based on Thomson Reuters data.Microsoft shares fell 2.2 percent to $43.75 in premarket trading following the New York Times reported the company plans to announce a brand new round of layoffs to chop costs further.
? Thomson Reuters