U.S. Stock Futures Fall on Concern Aid Plan Won’t Solve Crisis

U.S. Stock Futures Fall on Concern Aid Plan Won’t Solve Crisis
By Sarah Jones


May 11 (Bloomberg) -- U.S. stock-index futures fell, after the Standard & Poor’s 500 Index yesterday surged by the most in more than a year, on concern an almost $1 trillion emergency lending package for European countries will hamper growth.

Alcoa Inc., the largest U.S. aluminum producer, declined 2.5 percent in German trading. Metal prices fell after Chinese inflation accelerated at the fastest pace in 18 months, increasing pressure on the government to raise borrowing costs. MBIA Inc. dropped 7.5 percent after the largest bond insurer posted a first-quarter loss.

June contracts on the Standard & Poor’s 500 Index declined 1 percent to 1,145.4 at 11:17 a.m. in London. The S&P 500 yesterday surged 4.4 percent the VIX, the benchmark for U.S. stock options, had a record drop after European policy makers unveiled an unprecedented loan package and a program of bond purchases to contain the region’s sovereign-debt crisis. Dow Jones Industrial Average futures lost 0.8 percent to 10,656 and Nasdaq 100 futures slid 0.9 percent to 1,923 today.

“Gains from the $1 trillion bailout were short-lived as speculators foresee tough cutbacks for the troubled European states,” said Manoj Ladwa, a senior trader at ETX Capital in London. “Fears that China is overheating and could raise rates soon also has traders on the backfoot today.” .............(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=a8rbb8aqPcY8&pos=2