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Spain's Prime Minister Mariano Rajoy listens to a question during a session at the Spanish parliament in Madrid June 13, 2012. (ANDREA COMAS/REUTERS)
Spain's Prime Minister Mariano Rajoy listens to a question during a session at the Spanish parliament in Madrid June 13, 2012. (ANDREA COMAS/REUTERS)

Premarket: Futures slide on grim news from Europe Add to ...

U.S. stock index futures fell on Wednesday as investors found little reason to buy following steep equity gains in the previous session and as uncertainties persisted from Europe.

Markets have been volatile this week, with the S&P moving more than 1 percent for the past two trading days. Anemic trading volume has amplified the moves, which have largely been dictated by the news flow from the euro zone.

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Tuesday’s late rally came as Spanish bond yields dropped from euro-era record highs, easing some concerns about whether a recent bailout plan for the country’s banks would be effective.

Greece will also remain in focus ahead of the country’s June 17 elections, which could result in the country leaving the euro zone. European shares were down 0.3 percent.

“We’re facing some really serious issues in Europe over the rest of the week, and markets will chop around until after the election and we see some stability in European bonds,” said James Dailey, portfolio manager of TEAM Asset Strategy Fund in Harrisburg, Pennsylvania.

May retail sales fell 0.2 percent in the month, in line with expectations. Recent U.S. economic data, most notably the May payroll report, has pointed to sluggish domestic growth, another concern amid uncertainty from the euro zone.

“The data could create some short-term choppiness, but domestic data like this won’t be enough to outweigh possible news from Europe,” Dailey said.

Jamie Dimon, the chief executive of JPMorgan Chase & Co will tell lawmakers that the bank’s recent multibillion-dollar trading loss occurred because poorly managed traders embarked in January on a misguided hedging strategy they did not fully understand, according to written testimony prepared for a hearing on Wednesday.

S&P 500 futures fell 3.6 points and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures fell 25 points and Nasdaq 100 futures lost 9.5 points.

With the news flow so uncertain many traders are also looking at market levels, with 1,300 on the S&P 500 emerging again as a focus this week.

In another troubling sign from abroad, an influential government adviser in China was quoted as saying the country’s economic growth could fall below 7 percent in the second quarter if weak activity persists in June.

Amid weakness in Europe and signs of slowing in the United States, many investors look to China’s relatively robust expansion to pick up the slack, especially for commodity demand.

Dell Inc aims to raise its target on dividends and share buybacks to 20 to 35 percent of free cash flow, saying its corporate software and services business is on track to grow by an average of 10 percent annually until fiscal 2016. Shares advanced 3.2 percent to $12.35 in premarket trading.

Johnson & Johnson expects to complete its $19.7 billion purchase of Swiss medical device maker Synthes on Thursday and said the deal will slightly boost company profit this year, rather than being a moderate drag on earnings as previously expected. Shares of the Dow component rose 2 percent to $64.35 in premarket trading.

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