Stock futures pared their losses after a round of economic data came in more or less as expected.
Futures started off the day lower as Bank of America fell on news it was going back to the government for help and investors braced for a difficult earnings season, though JPMorgan offered some encouragement, beating expectations in a morning report.
Initial jobless claims rose by 54,000 last week, more than expected, though continuing claims fell by 115,000 to 4.5 million.
Producer prices fell 1.9 percent in December, as expected, amid a 9.3-percent drop in energy costs. Core PPI, which excludes food and energy costs, ticked up 0.2 percent.
Meanwhile, the New York Fed reported a gauge of manufacturing improved to minus-22.2 in January reading from a record minus-27.9 in December.
JPMorgan beat estimates in the fourth quarter, reporting earnings per share of 7 cents, or $702 million, while full-year 2008 net income was $1.37 per share, or $5.6 billion.
Shares waffled during the morning, gaining initially after the earnings report hit the market, falling briefly, then turning higher again, up about 3.3 percent in premarket trading.
The Dow Jones Industrial Average has chalked up a six-day losing streak so far, with losses totaling around 10 percent.
Financial stocks threatened to keep leading the charge lower after a Wall Street Journal report claimed Bank of Americais on the verge of tapping government funds for the second time.
BoA is struggling with its takeover of Merrill Lynch, according to the report. Shares of the bank were over 3 percent lower in pre-market trading.
Bank of America shares fell more than 6 percent premarket to below $10, a level at which the stock hasn't closed in more than 12 years.
Meanwhile, Citigroup gained 1.5 percent ahead of the open, after a 23-percent plunge Wednesday. Uncertainty over the bank’s future structure continued to unnerve investors.
The problem with the banking sector "isn’t going to be fixed over night," Doug Peta, president of Peta Associates, told CNBC. "I don’t think stock markets will be able to find a footing until policy makers find a footing," he added.
The day was looking especially bleak for technology, as investors digested Wednesday's after-the-bell news from Apple.
The sector’s role as relative haven suffered serious blows as Apple Chief Steve Jobs confirmed worries over the state of this health by announcing he would be on sick leave until the summer.
Apple shares were off 7 percent premarket.
Adding to the tech woes was Google, which said it would cull 100 full-time recruiter positions.
Job cuts were also on the cards at Delta . The airline said it expects about 2,000 staff to opt for an early retirement package.
On the economic front, the Producer Price Index, jobless claims data and the Empire State Manufacturing Survey are all released at 8:30 am New York time. The Philadelphia Fed Survey is out at 10 am. Over in Europe, a decision on interest rates is expected from the European Central Bank at 7:45 am.