Daniel Gross

Morning Reading: World Panic

Contrary Indicator

What to watch, courtesy of Yahoo! Finance's Elizabeth Trotta:

U.S. markets are headed for a plunge at the open Thursday. World stocks are selling off sharply, with European markets down more than 4% as investors speculate about the effectiveness U.S. Federal Reserve Open Market Committee's "operation twist" efforts to keep rates low amid what the Fed's policy making arm called "significant downside risks to the economic outlook, including strains in global financial markets."

* Investors are awaiting more clues on the U.S. economy via data on weekly jobless claims, mortgage rates, home prices and leading economic indicators. Billionaire investor George Soros said in an interview on CNBC that he believed the U.S. was already in a double dip recession.

* Greece continues to be a world focus as it ushers through cuts in an attempt to meet loan payments. The troubled nation's cabinet cut high pensions by 20 percent, put 30,000 civil servants in a labor reserve, lower the income threshold for paying tax and extended a real estate tax on Wednesday.

* FedEx reported higher revenue and earnings early Thursday, but also scaled back its outlook. It now projects earnings to be $1.40 to $1.60 per diluted share in the second quarter and $6.25 to $6.75 per diluted share for fiscal 2012, compared to its previous full year forecast of $6.35 to $6.85 per diluted share.

Economic Data:

8:30 a.m. Initial jobless claims (expected 418,000, prior 428,000)

10:00 a.m. FHFA Housing Price Index (prior 0.9%)

10:00 a.m. Mortgage Rates

10:00 a.m. Leading Indicators (expected 0.1%, prior 0.5%)

Earnings:

Discover, FedEx, Nike, Rite Aid

Early Headlines:

Stocks nosedive after Fed's gloomy assessment

Ahead of the Bell: Unemployment benefits

Analysis: Fed's twist moves hurt company pension plans

Oil falls near $83 as Fed warns of economic risks

Greece sharpens austerity; IMF warns on banks

Health Insurance costs to rise 5.4% in 2012

NY Times Co. CEO says ad slump worsened in 3Q

What Bernanke Might Say to His GOP Critics

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