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Futures Pare Losses as Spending Climbs

US stock index futures pared losses slightly Friday after a report showed personal spending rose for a second straight month.

Personal spending rose for a second straight month, climbing 0.2 percent in February after January's revised 1-percent increase, while income slipped 0.2 percent.

Banks shares, which have helped lead the March rally, were exerting the most pressure on futures.

Dow components Bank of America fell 4 percent in premarket trading, while Citigroup tumbled 7.8 percent.

The Standard & Poor's 500 was on pace to have its best month in 25 years, but there remained concerns that economic headwinds could put a damper on the surge upward.

General Motors shares continued a sharp move higher, gaining 30 percent premarket as President Obama has made it clear that saving the Detroit automakers is a priority.

Asian stocks were mixed. In Japan, contracting consumer prices threatened deflation and a deepening recession while a larger-than-expected fall in February retail sales showed more signs of gloom.

In Europe, shares were mixed after a lower open and with fourth-quarter UK gross domestic product data worse than previously estimated.

In corporate news, President Obama said Thursday evening that struggling automakers could expect some more government aid if they commit to restructuring as part of an official rescue plan due to be unveiled soon.

In the technology sector, Google confirmed it would cut 200 jobs in its sales and marketing team, to cut costs, showing that the recession was biting into the most robust sectors. Shares edged higher premarket.

Before the G20 meeting in London next week, UK Prime Minister Gordon Brown is on a tour to persuade the biggest economies to help get the world out of the crisis.

After a meeting with Brazilian President Luiz Inacio Lula da Silva, Brown called on the G20 to back a $100 billion expansion of trade finance to reverse a fall in exports and called for a global trade agreement.

But Lula da Silva sparked accusations of racism when he said "white, blue-eyed people" were to blame for the crisis.

KB Home will report earnings before the bell.