US stock futures fall on European debt worries

By FRANCESCA LEVY | May 23, 2011 | 8:15 AM EDT

FILE - In this file photo taken May 2, 2011, trader Christopher Forbes works on the floor of the New York Stock Exchange. Heightened tensions over Europe's debt crisis combined with weak economic surveys to send world stock markets sliding on Monday, May 23, 2011,with the euro dropping below $1.40 for the first time in two months. (AP Photo/Richard Drew, file)

NEW YORK (AP) — Stock futures are down sharply as new warnings about European finances stoke fears about that region's debt crisis. The euro dipped to its lowest level in two months.

Ahead of the opening bell, Dow Jones industrial average futures are down 97, or 0.8 percent, at 12,369. S&P 500 index futures are down 10, or 0.8 percent, at 1,317. Nasdaq 100 futures are down 20, or 0.8 percent, at 2,324.

Ratings agency Standard & Poor's cut its outlook Saturday on Italy's debt to negative from stable.

Financial markets in Spain are down sharply after a defeat for its ruling Socialist party caused investors to fear that the government cannot solve its public finance issues.

On Friday, the Fitch ratings agency downgraded Greece's debt rating further into junk status.