Stock futures little changed a day after big gains

[December 01, 2011]  NEW YORK (AP) -- U.S. stock futures are little changed Thursday, a day after the Dow Jones industrial average had it biggest gain in more than two years.

The euphoria over Wednesday's move by major central banks to cut borrowing costs has subsided a bit. European stock markets are mixed. Investors are once again seeking signs that European leaders can find a solution to the debt crisis there.

Less than two hours before U.S. markets open, Dow futures are up 2 to 12,036. Futures for the broader S&P 500 are down 1 to 1,245

Markets jumped Wednesday when the central banks of Europe, the U.S., Britain, Canada, Japan and Switzerland made it cheaper for banks to borrow dollars, helping them to operate smoothly at a time of tight credit.

The move by the central banks sent the Dow soaring 490 points, or 4.2 percent, the largest gain since March 2009 and the seventh-largest of all time. The Standard & Poor's 500 closed up 4.3 percent.

China's central bank also acted to release money for lending and shore up growth by lowering bank reserve levels for the first time in three years.

Worries about Europe's financial system and the European Central Bank's reluctance to intervene heavily in bond markets have seen borrowing rates rise for European countries in recent weeks. That raised fears of a global credit crunch of the type that plunged the global economy into recession in 2009.

As a result of the central banks' action, commercial banks in the EU and four other countries will now be able pay less to borrow dollars, the currency of international trade.

But analysts said that the decision might only have a short-term effect and does nothing to solve the underlying problem of an enormous government debt in Europe. Investors say the real boost to the markets might come only if European leaders announce a dramatic action at the summit on debt crisis next week.

After huge gains this week, Britain's FTSE 100 inched up another 0.6 percent to 5,536.58 and France's CAC-40 was 0.3 percent higher at 3,162.67 in morning trading. But Germany's DAX fell 0.2 percent to 6,079.50.

Asian markets earlier posted sharp gains as they caught up with the news of the central banks' intervention. Japan's Nikkei 225 index jumped 1.9 percent to close at 8,597.38. South Korea's Kospi surged 3.7 percent to 1,916.18 and Hong Kong's Hang Seng vaulted 5.6 percent to 19,002.26.

[Associated Press]

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