Futures pared earlier gains Wednesday to indicate a mixed open for Wall Street as optimism from the previous day's consumer confidence data dwindled and was replaced by anxiety about what looks like certain bankruptcy for General Motors.
General Motors was one step closer to Chapter 11 as sources told CNBC the government stands to take a 70 percent stake in the ailing automaker after only a small fraction of bond holders took part in the company's $27 billion bond swap on Tuesday. GM offered a 10 percent equity stake of the reorganized GM in return for unsecured debt.
The company is expected to announce further information on how the bond swap went on Wednesday morning. The United Auto Workers union's rank-and-file will vote on the proposed contract, whereby GM will offer buyouts to all UAW employees, on Wednesday and Thursday.
GM shares fell more than 8 percent in premarket trading.
Dow and Standard & Poor's 500 futures were slightly above fair-market value ahead of the opening, while Nasdaq futures were slightly negative.
In Germany, the fate of GM's Opel unit is to be decided later in the day. The country's government has been considering offers from Italy's Fiat, Canada's Magna International and Belgium-listed RHJ International, as well as late entry China's Beijing Automotive Industry. But GM is not entertaining the Chinese bid, the Wall Street Journal reported.
Chrysler is back in bankruptcy court at 10 am New York time on Wednesday on its sale to Fiat. CNBC's Phil Lebeau reports that Chrysler could be out of bankruptcy as early as next week.
Outside the auto news, shares of office products retailer Staples surged 9 percent after the company reported a profit of 20 cents per share, beating analyst estimates even though the earnings were sharply lower from the previous year.
On the economic front, the real-estate sector will be in focus as existing home sales data for April is due out at 10 am New York time. At the same time, the Federal Deposit Insurance Corporation (FDIC) quarterly banking profile takes place.
The U.S. Treasury sold $40 billion of debt on Tuesday and sells another $61 billion this week. The Treasury will sell $35 billion of five-year paper later on Wednesday.
The day's economic news kicked off on a sour note, with a jump in interest rates sending mortgage applications to their lowest point since early March.
In the latest survey from the National Association for Business Economists, nearly 75 percent expect the downturn to end in the third quarter. But they believe unemployment will climb, even if the economy is rebounding. Forecasters say the unemployment rate should average 9.1 percent this year. They expect GDP to contract 2.8 percent for the year, worse than the 1.9 percent drop in their previous forecast.
Looking to tech, Twitter's co-founders Tuesday night said they plan to eventually charge some type of fee for the company's services. They mentioned possible revenue drivers for the online messaging service, such as banner ads, but did not give many details.
Citigroup said on Wednesday it has no plans to get rid of its stakes in Chinese and Indian banks, and instead wants to increase lending in those countries. Citi's Asia-Pacific chief told the Financial Times it is in everyone's best interest for the company to growth in a region that is delivering strong profits.
Retailers could be active after Oppenheimer initiated coverage on the sector, giving companies like OfficeMax , Lowe's and Bed, Bath & Beyond an 'outperform' rating. Bed, Bath & Beyond's price target was set to $42, while the company's shares closed at $28.31 on Tuesday.
Staples and Autozone both are scheduled to report earnings before the bell. Analysts are looking for quarterly earning of 21 cents a share for Staples and $2.89 a share for Autozone.
Oil giant ExxonMobil holds its annual meeting in Dallas Wednesday, and Amylin faces off with investor Carl Icahn who is trying to unseat directors in a proxy vote. Its annual meeting is at 11:30 am New York time.