Investing.com - U.S. stock futures pointed to losses of more than 1% at the open on Monday, as growing fears that Spain will need a full-scale sovereign debt bailout and fresh concerns over a Greek exit from the euro zone prompted investors to shun riskier assets.
Ahead of the open, the Dow Jones Industrial Average futures pointed to a loss of 1.1%, S&P 500 futures signaled a drop of 1.1%, while the Nasdaq 100 futures indicated a decline of 1.2%.
The yield on Spanish 10-year bonds rose to a record 7.57% on Monday, well above the 7% threshold widely considered unsustainable in the long term, amid growing fears that Spain will need a full bailout after the state of Murcia followed Valencia in requesting financial aid from Madrid over the weekend.
Spanish media reported that several others among Spain's 17 semi-autonomous regions are expected to follow, including the two biggest regions, Catalonia and Andalucia.
Meanwhile, fears over a Greek exit from the euro zone resurfaced, amid worries whether Athens can meet the conditions of its international bailout ahead of a meeting with the Troika on Tuesday.
The news prompted investors to shun riskier assets, such as stocks and commodities, and flock to traditional safe haven assets like the dollar and U.S. Treasuries.
Shares in the financial sector came under heavy selling pressure in pre-market trade. Wall Street investment bank Morgan Stanley saw shares sink 4.8%, Bank of America declined 2.4%, while shares in JP Morgan lost 1.1%.
Shares in heavy machinery makers and raw material producers were lower, amid persistent worries about China's economic slowdown.
Caterpillar shares retreated 1.65%, BHP Billiton fell 3.65%, while Exxon Mobil shares slumped 0.95.
In deal news, U.S.-listed shares of Canadian energy firm Nexen surged 52% after it agreed to be acquired by Chinese oil major CNOOC for approximately USD15.1 billion.
Shares in fast food giant McDonald’s were steady ahead of the release of its closely-watched second quarter earnings report due out before Monday’s opening bell.
Halliburton and Hasbro were also slated to release earnings before the opening bell, while Texas Instruments releases earnings after markets close.
Across the Atlantic, European stock markets were sharply lower. The EURO STOXX 50 tumbled 2.1%, France’s CAC 40 sank 2.05%, Germany's DAX dropped 1.7%, while Britain's FTSE 100 declined 1.8%.
During the Asian trading session, Hong Kong's Hang Seng Index plunged 3%, while Japan’s Nikkei 225 slumped 1.9%.
Neither the euro zone nor the U.S were to release any significant economic indicators on Monday, so markets looked set to remain focused on developments in Europe.
Ahead of the open, the Dow Jones Industrial Average futures pointed to a loss of 1.1%, S&P 500 futures signaled a drop of 1.1%, while the Nasdaq 100 futures indicated a decline of 1.2%.
The yield on Spanish 10-year bonds rose to a record 7.57% on Monday, well above the 7% threshold widely considered unsustainable in the long term, amid growing fears that Spain will need a full bailout after the state of Murcia followed Valencia in requesting financial aid from Madrid over the weekend.
Spanish media reported that several others among Spain's 17 semi-autonomous regions are expected to follow, including the two biggest regions, Catalonia and Andalucia.
Meanwhile, fears over a Greek exit from the euro zone resurfaced, amid worries whether Athens can meet the conditions of its international bailout ahead of a meeting with the Troika on Tuesday.
The news prompted investors to shun riskier assets, such as stocks and commodities, and flock to traditional safe haven assets like the dollar and U.S. Treasuries.
Shares in the financial sector came under heavy selling pressure in pre-market trade. Wall Street investment bank Morgan Stanley saw shares sink 4.8%, Bank of America declined 2.4%, while shares in JP Morgan lost 1.1%.
Shares in heavy machinery makers and raw material producers were lower, amid persistent worries about China's economic slowdown.
Caterpillar shares retreated 1.65%, BHP Billiton fell 3.65%, while Exxon Mobil shares slumped 0.95.
In deal news, U.S.-listed shares of Canadian energy firm Nexen surged 52% after it agreed to be acquired by Chinese oil major CNOOC for approximately USD15.1 billion.
Shares in fast food giant McDonald’s were steady ahead of the release of its closely-watched second quarter earnings report due out before Monday’s opening bell.
Halliburton and Hasbro were also slated to release earnings before the opening bell, while Texas Instruments releases earnings after markets close.
Across the Atlantic, European stock markets were sharply lower. The EURO STOXX 50 tumbled 2.1%, France’s CAC 40 sank 2.05%, Germany's DAX dropped 1.7%, while Britain's FTSE 100 declined 1.8%.
During the Asian trading session, Hong Kong's Hang Seng Index plunged 3%, while Japan’s Nikkei 225 slumped 1.9%.
Neither the euro zone nor the U.S were to release any significant economic indicators on Monday, so markets looked set to remain focused on developments in Europe.