Stocks are set to resume their plunge Thursday, as China deflated investors' hope that the country will boost spending and worries re-emerged about General Motors(GM Quote - Cramer on GM - Stock Picks).
Chinese Premier Wen Jiabao said the government's stimulus plan would help the world's third-largest economy grow by 8% this year. He stopped short, however, of delivering the promise of new stimulus measures.
The hope that China would unveil more government spending was a major trigger for the stock market's bounce Wednesday. Wednesday's stock rally followed a five-day pummeling that left the market at its lowest levels since 1997.
The market's upbeat tone appeared to be short-lived, as investors early Thursday prepared to move out of stocks and back into safer assets like Treasurys and gold.
Another piece of gloomy news: General Motors announcing in its annual report that its auditors have raised serious doubt about the automaker's ability to continue operating. GM has already received $13.4 billion in federal loans, and is seeking a total of $30 billion from the government.
Ahead of the market's opening, Dow Jones Industrial Average futures dropped 105, or 1.54%, to 6,725. S&P 500 index futures lost 9.90, or 1.40%, to 698.50, and Nasdaq 100 index futures fell 3.25, or 0.30%, to 1,097.75.
Major retailers will be reporting monthly sales figures throughout the day.
Government bond prices edged modestly higher. The yield on the benchmark 10-year Treasury note, which moves opposite its price, slipped to 2.97% from 2.98% late Wednesday. The yield on the three-month T-bill, considered one of the safest investments, was unchanged at 0.25%.
