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Futures Flat Amid Caution Ahead of EU Summit

Futures were hugging the flatline Wednesday as investors took a breather following two days of gains to see if EU officials could come up with a plan to deal with the region's debt crisis during a summit at the end of the week.

Investors seemed unfazed after S&P said it might downgrade the EFSF credit rating. This comes after the agency warned it could downgrade the credit ratings of 15 euro zone member states.

S&P also cut credit ratings on Tuesday for several regional banks in North America, including US Bancorp , PNC Financial Services, and BB&T as the agency continued to apply new grading criteria announced last month.

Geithner is due to meet French President Nicolas Sarkozy before flying to the southern French port of Marseille for discussions with incoming Spanish Prime Minister Mariano Rajoy.

Details of reform proposals to the European Union's treaty were due to be presented on Wednesday in a letter to European Council President Herman Van Rompuy, who will chair the meeting of 27 EU leaders due to start Thursday evening.

In corporate news Citigroup will be a likely focus for investors after the banking giant announced that it would cut almost 4,500 jobs worldwide, almost 2 percent of its workforce.

India suspended plans to open its $450 billion supermarket sector to foreign groups such as Wal-Mart Stores, backtracking on one of the government's boldest reforms in years in the face of a huge political backlash.

MidAmerican Energy, part of Warren Buffett's Berkshire Hathaway , is to buy First Solar's 550-megawatt Topaz Solar Farm power plant in California, a source familiar with the transaction said.

Apple will be in the spotlight after HTC said it has no plans to change fourth-quarter sales guidance, as shares in the world's No.4 smartphone maker fell over 5 percent on concern its sales decline may not moderate from a 30 percent drop in November.

General Motors is closing in on a package of proposed fixes for the Chevrolet Volt battery pack that engineers believe would eliminate the risk of a fire being triggered days after a crash, two people with knowledge of the situation said.

Martha Stewart Living Omnimedia surged after news JC Penney may be buying a 16.6 percent stake in the diversified media and merchandising company for $38.5 million, according to the New York Times.

On the economic front, weekly mortgage applications jumped last weekas interest rates continued to decline, according to the Mortgage Bankers Association.

Meanwhile, China's annual rate of export growth slowed in November versus October, vice commerce minister Chong Quan told reporters after an official media briefing.

—Follow JeeYeon Park on Twitter: twitter.com/JeeYeonParkCNBC

On Tap This Week:

WEDNESDAY: Quarterly services survey, oil inventories, consumer credit
THURSDAY: BoE announcement, ECB announcement, McDonald's sales report, jobless claims, wholesale trade, AT&T CEO speaks; Earnings from Costco, Smithfield Foods
FRIDAY: International trade, consumer sentiment, Greek short selling ban expires, EU summit

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