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Stocks decline amid overseas jitters

David Russell (david.russell@optionmonster.com)

U.S. equities are following Europe lower after business confidence fell in Germany.

S&P 500 futures are down by less than one-third of 1 percent after spending more than a week consolidating near multiyear highs. The index has been drifting steadily higher since the summer without a major pullback signs of economic improvement offset worries about financial contagion in Europe.

But today's Ifo survey of German business confidence is undermining that perception by falling to 101.4 in September from 102.3 in August. Economists in a Reuters poll had predicted an increase to 102.5.

The DAX index fell 0.6 percent, while France's CAC-40 declined 1 percent. Both indexes have been rebounding as the U.S. market open approaches.

Asian stocks posted smaller losses in the overnight session. Pessimism also rose at Chinese manufacturers and retailers, according to a central bank poll modeled on the U.S. Federal Reserve's Beige Book.

The pattern of risk aversion is extending to commodities and currencies, with the U.S. dollar higher against the euro, Australian dollar, and Canadian dollar. The yen is broadly stronger as well, another sign of caution.

Oil is down more than 1 percent, while silver has dropped more than 2 percent. Gold, copper, and agricultural foodstuffs are lower by roughly 1 percent or more.

In company-specific news, homebuilder Lennar is higher by almost 4 percent after reporting strong earnings. Questcor Pharmaceuticals, which began last week over $50, plunged more than 20 percent after announcing that its promotional practices were under investigation by the federal government.

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