Stock futures were pointing to a much lower open after manufacturing in the New York area slowed significantly in June.
Futures for the Dow Jones Industrial Average were down by 105 points, or 91 points below fair value, at 11,913. Futures for the S&P 500 were lower by 12 points, or 9 points below fair value, at 1273, and Nasdaq futures were off by 20 points, or 20 points below fair value.
Stocks held strong gains throughout Tuesday’s session after economic data wasn’t as weak as feared.
Hong Kong’s Hang Seng lost 0.7% while Japan’s Nikkei added 0.3%. The FTSE in London was slipping 0.4%, and the DAX in Frankfurt was declining 0.7%.
The Bureau of Labor Statistics said consumer prices rose 0.2% in May, which was slightly ahead of the 0.1% uptick that economists had been expecting. The core rate, which excludes volatile food and energy prices and is considered the closest gauge of inflation, gained 0.3%, outpacing expectations for an increase of 0.1%. In April, the consumer prices rose 0.4% and the core rate grew by 0.2%.
Manufacturing activity in the New York area slowed significantly in June as the Empire State manufacturing index sunk to a negative reading of -7.8, from May’s level of 11.9. Economists had only expected the index to dip to a reading of 10 in June.
Late Tuesday, Wisconsin’s Supreme Court ruled that a law that eliminates collective bargaining rights of most state workers can go into effect, marking a victory for Republican Gov. Scott Walker who pressed for the law’s passage as a way to address the state’s $3.6 billion budget deficit.
The Securities and Exchange Commission is looking into the sale by Merrill Lynch of a complex mortgage-related security it created for an Illinois hedge fund, according to a Financial Times report. Shares of Bank of America, Merrill Lynch’s parent company, were down 0.6% at $10.74 ahead of Wednesday’s opening bell. By Melinda Peer, The Street