RTRS: U.S. stock futures signal losses on automaker woes
U.S. stock index futures pointed to losses on Monday on worries over the troubled auto sector after Washington's rejection of viability plans from General Motors (GM.N) and Chrysler.
At 0848 GMT, futures for the S&P 500 SPc1 were down 2.7 percent, Dow Jones DJc1 futures were down 2.2 percent and Nasdaq 100 NDc1 futures were down 2.5 percent.
The Obama administration autos task force rejected the turnaround plans of General Motors Corp and Chrysler LLC, forcing out GM's CEO Rick Wagoner, and warned both could be put through bankruptcy to slash debts. [ID:nN29520526]
Shares in GM traded in Frankfurt (GM.F) were down 16 percent.
The news weighed on auto stocks around the world, with Nissan Motor (7201.T) and Toyota Motor (7203.T) losing 7.7 percent and 3.7 percent respectively in Tokyo.
In Europe, Daimler (DAIGn.DE), which has a stake in Chrysler, was down 7.2 percent, Fiat (FIA.MI) was down 6.4 percent and BMW (BMWG.DE) down 6.8 percent.
Japan's Nikkei stock average .N225 fell 4.5 percent and the FTSEurofirst 300 .FTEU3 index of top European shares was down 3 percent in early trade, also hit by renewed fears over the banking sector after Spain announced it would bail out embattled regional savings bank Caja Castilla la Mancha.
"The spectre of the bankruptcy of either GM or Chrysler is enough to prompt investors to book profits after the sharp gains we've seen recently. But I don't think Washington will let the automakers fail," said Christian Jimenez, president of Imene Investment partners, in Paris.
"The bailout of a bank in Spain is also a strong reminder that there are still toxic assets in the pipeline and that the credit crisis is not over yet," he said.
On the positive side, U.S. President Barack Obama said in an interview published on Sunday that he saw "glimmers of stabilization" in some areas of the U.S. economy, including pockets of the domestic housing market.
U.S. shares lost ground on Friday, as investors pocketed recent gains and bank stocks fell after bank executives indicated March had been a tougher month for the industry than the previous two.
