U.S. Equity-Index Futures Decline Amid China-Induced Selloff

U.S. stock-index futures dropped, indicating the Standard & Poor’s 500 Index will fall for a second day, on concern China’s woes will hamper the global economic recovery.

S&P 500 E-mini contracts expiring in September declined 1.1 percent to 2,056.75 at 10:54 a.m. in London. Futures on the Dow Jones Industrial Average lost 180 points, or 1 percent, to 17,175.

The S&P 500 slid 1 percent on Tuesday, the most in more than two weeks, as China devalued its currency in an unexpected move that bolstered speculation the Federal Reserve may have to delay raising rates. The threat of a slowdown in China could harm global growth, while lower commodity prices damp inflation.

The surprise devaluation sparked the biggest two-day selloff in Asian currencies since 1997, while the dollar dropped against the euro and the yen.

Among stocks moving on corporate news, General Electric Co. fell 1.4 percent in early New York trading after it agreed to sell its health-care finance unit to Capital One Financial Corp. for about $ 9 billion.

Cisco Systems Inc., News Corp. and Macy’s Inc. post quarterly results on Wednesday as the earnings season nears its end. About three-quarters of the S&P 500 companies that have reported so far beat profit estimates, while almost half topped sales projections. Analysts expect a 2.1 percent drop in second-quarter earnings, less than July 10 calls for a 6.4 percent decline.

Investors will also watch economic reports this week, including U.S. retail sales and import-price data on Thursday, and industrial production and consumer sentiment on Friday.

Source: Bloomberg

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