NEW YORK (AP) — Stock futures slid Friday as the economic crisis in Europe overshadowed a surprisingly strong earnings performance by major U.S. corporations.
Dow Jones industrial average futures fell 65 points to 12,815. Standard & Poor's 500 futures gave up 9.2 points to 1,362.70 and Nasdaq futures fell 8.75 points to 2,643.50.
Both Britain and Spain are seeing the costs of borrowing rise over doubts about their ability to repay debt. Spain's borrowing rates are nearing unsustainable levels and tens of thousands of protesters have taken to the streets in 80 cities, including Madrid, where they have clashed with riot police.
On Friday, finance ministers from the 17 countries that use the euro approved the terms of a bailout loan for Spanish banks. The initial price tag is $122.9 billion, but the true cost is not likely to be known until September, after the banks have been assessed in depth.
U.S. companies continued to surprise investors Friday. While General Electric's earnings were hit by huge pension costs, it still edged out Wall Street expectations. Net income for the second quarter fell to $3.11 billion from $3.69 billion last year. Removing pension costs and losses from discontinued operations, the conglomerate topped per-share earnings by a penny.
And after a big earnings report from IBM earlier in the week, Google erased many doubts about its ability to make money, posting earnings of $2.8 billion for its most recent quarter.
Investors, however, have begun to key in on revenue numbers from those companies. While cost cuts and other measures have allowed bigger profits, the revenue being generated is falling short. Revenue at GE was just shy of Wall Street predictions.
At Google, revenue climbed 35 percent from last year, but if not for the company's acquisition of Motorola, revenue would have increased 21 percent. That would have been Google's slowest rate of revenue growth since the fourth quarter of 2009, when the company was just starting to recover from the Great Recession.
And there has also been a steady drumbeat of dour economic reports that have tempered any enthusiasm in the market about corporate profits.
A measure of manufacturing in the mid-Atlantic region Thursday was much weaker than economists had predicted. And economic reports on home sales and leading economic indicators were unexpectedly weak.
