U.S. stock futures are lower after weak government bond auctions in Spain and France deepened fears the debt crisis is spreading to the region's core nations.
NEW YORK (TheStreet) -- U.S. stock futures were following European stocks lower after weak government bond auctions in Spain and France deepened fears that Europe's debt crisis is spreading to the region's core nations.
Futures for the Dow Jones Industrial Average were down 29 points, or 60 below fair value, at 11,876. The index has traded down two of the last three sessions.
Futures for the S&P 500 were down 5 points, or 8 points below fair value, at 1227. Futures for the Nasdaq were off 8 points, or 17 below fair value, at 2309.
Spain paid the highest interest rates on 10-year Treasuries in a government bond auction since 1997 Thursday. France, the eurozone's second-largest economy, had an easier time with its auction but still had to pay a markedly higher price.
Meanwhile, Italy's borrowing costs have soared to unsustainable levels, with yields on its 10-year bonds at 7.06% after topping 7% in the prior session.
Little changed in terms of political action out of Europe overnight. Stocks closed the previous session on a down note, pressured by news that Fitch Ratings predicted a worsening outlook on the credit of U.S. banks if Europe's debt crisis deepens. According to Fitch, the six biggest U.S. banks had a total of $50 billion in risk related to exposure to stressed nations Greece, Ireland, Italy, Portugal and Spain. The Dow slid 1.6%, with most of the losses coming in the final hour of trading.
The U.S. market often fights its way back up after Europe closes, noted Marc Pado, strategist with Cantor Fitzgerald. But, he added, as with the prior session's trading, an entire day's gains can be erased in minutes.
"The reason why it was so easy to move the financials lower and the overall market as well is that this is a very light volume environment, between earnings season, before Black Friday, in the midst of global political turmoil, and ahead of the Super Committee vote," explained Pado in a research note.
Oil was slipping Thursday after prices broke above $100 a barrel Wednesday for the first time since early June. The December crude oil contract was edging down 83 cents to trade at $101.76 a barrel.
U.S. economic data has been a source of optimism for investors. On Thursday, the Labor Department will release its weekly jobless claims data at 8:30 a.m. The latest claims are expected to edge up to 395,000 from 390,000, according to Thomson One Analytics.
Also at 8:30 a.m., investors expect housing starts data from the Commerce Department. Starts are forecast to have fallen to an annualized pace of 610,000 in October from 658,000 in the prior month.
The Philadelphia Fed will release its business outlook index for November at 10 a.m. The index will likely slip to a reading of 8.0 from 8.7 in the month prior.
The euro was up 0.096%. London's FTSE was losing 2.04%, and Germany's DAX was slipping by 1.18%. Overnight, Asian stocks closed mixed, with Japan's Nikkei Average edging up 0.19% and Hong Kong's Hang Seng down 0.76%.
Gold for December delivery was down $15.90 to trade at $1758.40 an ounce on Monday.
The dollar was down 0.17% compared with a basket of currencies. In the bond market, 10-year Treasuries were gaining 8/32, diluting the yield to 1.972%.
-- Written by Chao Deng in New York.