Stock futures hit after European elections
NEW YORK, May 7 — Stock index futures fell after Greek voters trounced ruling parties in elections yesterday, a result that put the country’s future in the euro zone at risk, and as Socialist candidate Francois Hollande won the French presidency.
S&P 500 futures were down 12.3 points at 1,350.20 at 7:35pm EDT (2335 GMT), suggesting a fall of about 1 per cent when the US stock market opens today.
Dow Jones industrial average futures fell 176 points, and Nasdaq 100 futures lost 28 points.
That was when results from Greece, with over 61 per cent of the vote counted, showed the only two major parties supporting a European Union-International Monetary Fund programme that keeps Greece from bankruptcy would struggle to form a lasting coalition.
In France, Hollande, shortly after winning the presidential election yesterday against conservative incumbent Nicolas Sarkozy, promised to start a pushback against German-led austerity policies.
David Kotok, president of Cumberland Advisors, an investment firm based in Sarasota, Florida, said despite the initial negative reaction of investors to the election results, the chances of more active monetary policy among leading advanced economies seemed to be rising, which would provide relief.
“Once markets realise that the political winds are now accelerating toward more easing by the G4, markets will resume an upward bias,” Kotok said in an emailed note yesterday. — Reuters