Stock futures fall as global economic worries rise

[June 22, 2009]  NEW YORK (AP) -- Lowered expectations for the global economy are giving investors more to be wary about.

Stock futures retreated early Monday as the World Bank added to the market's growing economic worries. The Washington-based multilateral lender predicted the world economy will shrink 2.9 percent in 2009. That estimate was worse than its previous forecast for a 1.7 percent decline.

Before the market's open, Dow Jones industrial average futures fell 50, or 0.6 percent, to 8,426. Standard & Poor's 500 index futures fell 6.90, or 0.8 percent, to 908.80, and Nasdaq 100 index futures fell 9.00, or 0.6 percent, to 1,455.00.

The stock market is coming off its first weekly loss in more than a month after a batch of weak economic readings, including the seventh straight monthly drop in industrial production. The Dow fell 3 percent last week, while the S&P 500 index dropped 2.6 percent and the Nasdaq composite lost 1.7 percent.

No major economic reports are due Monday. But later in the week, traders will focus on data on new and existing home sales, durable goods orders, gross domestic product and personal incomes and spending.

The Federal Reserve will also be in the spotlight after its two-day meeting on monetary policy finishes Wednesday. The central bank is expected to hold its key rate steady near zero, but investors want to know whether policy makers will buy more Treasurys than they initially planned.

The Fed has been buying government debt at the same time the Treasury Department has been issuing record amounts of government debt. The Treasury is planning to auction $104 billion in debt this week.

Bond prices rose in early trading Monday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, slipped to 3.75 percent from 3.78 percent late Friday.

Crude oil fell $1.15 to $68.40 a barrel in premarket trading on the New York Mercantile Exchange.

The dollar was mixed against other major currencies, while gold prices fell.

Overseas, Japan's Nikkei stock average rose 0.4 percent. In midday trading, Britain's FTSE 100 fell 1.2 percent, Germany's DAX index fell 1.3 percent, and France's CAC-40 fell 1.5 percent.

[Associated Press; By MADLEN READ]

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