U.S. stock futures were dragged lower Wednesday, with the euro trading near 23-month lows against the dollar, as worries over the euro zone crisis intensified.
Futures had briefly pared their losses earlier after the European Commission said the euro zone must move towards a banking union, issue eurobonds and boost growth while cutting debt.
The report came as fears grew that Spain would be the next country in the euro zone to trigger a crisis after reports that the European Central Bank rejected Madrid’s plan to rescue its banking sector by tapping the central bank itself for funds.
The ECB denied the reports later in the day, saying in a statement it had "not expressed a position on plans by the Spanish authorities to recapitalize a major Spanish bank." It added that it "stands ready to give advice on the development of such plans."
European shares slippedand the euro touched a 23-month lowas investors worried that Spain's banking problems would push its borrowing costs near highs not seen since last November. And worries over Italy's borrowing costs also raised alarm, pushing the Italian 10-year bond above 6 percent.
Meanwhile, investors continue to hold their breath until Friday’s jobs data are released.
In corporate news Facebook has received notice that U.S. antitrust regulators will give its proposed purchase of the popular photo-sharing app maker Instagram a lengthy investigation. The social media website’s share price plunged almost 10 percent in the previous session. Facebook shares have now fallen 24 percent since it launched on the stock market almost two weeks ago.
Apple CEO Tim Cook said technology for televisions was of "intense interest" but stressed the company's efforts would unfold gradually, amid speculation the iPad and iPhone maker was on the brink of unveiling a revolutionary iTV.