Futures Lower as Hopes Fade Over Euro Zone Fix

US stock index futures pointed to a lower open on Wall Street on Wednesday as investor caution replaced hope of a resolution to the euro zone debt crisis ahead of a meeting of European Union leaders in Brussels.

Stocks closed flat in the previous sessionafter Greece's former Prime Minister Lucas Papademos said the risk of Greece leaving the euro is real, and that an exit would have "catastrophic" economic consequences for Greece and the rest of the euro zone.

Papademos later clarified to CNBC that no preparations were underwayin Greece for possibly exiting the euro.

Still, worries over Greece's potential exit kept investors on edge, especially ahead of the EU summit. The informal summit is expected to discuss growth-boosting measures and the prospect of common euro zone bonds, but investors doubt it will produce a plan to resolve the debt crisis and restore market optimism, especially as Germany strongly opposes the idea of mutualizing debt.

European stocks fell sharply, reversing a two-session recovery rally, while the euro hit a 21-month low against the dollar.

Investors flocked to lend to Germany in an auction on Wednesday, although the country offered a 0 percent coupon for 2-year bonds it sold. The average yield in the auction was 0.07 percent—almost free money for the euro zone’s paymaster.

Back in the U.S. it appeared battle lines over the Federal budget were already being drawn as the Congressional Budget Office warned on Tuesday a stalemate over how to tackle a series of fiscal deadlines at the end of the year would likely push the U.S. economy into recession in the first half of 2013.

Facebook will once again also be in focus after sources told Reuters that while company officials traveled the country to talk up the company's $16 billion initial public offering, the social networking giant advised analysts for underwritersto reduce revenue and earnings forecasts.

In corporate news Dell plunged after the IT giant forecast disappointing second-quarter revenue as U.S. and European corporate tech spending weakens and consumer personal computer sales continue to shrink.

Rival Hewlett-Packard is scheduled to post after the closing bell tonight.

Ford received its second "investment grade" credit rating, allowing the second-largest U.S. automaker to reclaim its Blue Oval insignia and other assets it mortgaged in 2006 to fund its turnaround plan.

U.S. clothing maker Guess reported a quarterly profit that beat market expectations, helped by fewer discounts at its North American retail business and higher sales in Asia, sending its shares up about 6 percent after the closing bell.

And PetSmart posted a better-than-expected quarterly profit and raised its full-year outlook on strong sales across all its product categories, sending its shares up 8 percent in after the close.

Meanwhile, Ariba was trading flat after European software company SAP said it plans to buy the company in a deal valued around $4.3 billion, the latest sideswipe against rival Oracle in the fast-growing Internet-based computing market.

The FHFA House Price Index will publish its latest assessment of U.S. home prices at 10 am ET, with economists seeing a 0.5 percent increase for March versus February.

—By CNBC’s JeeYeon Park (Follow JeeYeon on Twitter: @JeeYeonParkCNBC)

Coming Up This Week:

WEDNESDAY: FHFA home price index, oil inventories, 5-yr note auction, Minneapolis Fed's Kocherlakota speaks, CME shareholders mtg, Kraft shareholders mtg; Earnings from NetApp, Pandora
THURSDAY: Durable goods orders, jobless claims, 7-yr note auction, BlackRock shareholders mtg, Goldman Sachs shareholders mtg, McDonald's shareholders mtg; Earnings from Costco, Tiffany
FRIDAY: Consumer sentiment, USDA food prices outlook

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