US STOCKS-Futures point down as credit crunch tightens

By Justin Grant

NEW YORK, March 26 (Reuters) - U.S. stock futures pointed to a lower open on Wednesday as the global credit crisis threatened to thwart a $20 billion leveraged buyout of U.S. radio operator Clear Channel Communications Inc (CCU.N).

The lingering financial woes also looked likely to make Deutsche Bank (DBKGn.DE) miss its full-year profit target.

Germany's largest bank said the credit crunch could hurt its corporate and investment banking businesses, while banks are increasingly reluctant to take on credit risk because their balance sheets are strained by bad bets on subprime mortgages.

Last year Clear Channel agreed to be bought by private equity firms Thomas H. Lee Partners and Bain Capital Partners for $39.20 a share but the deal may be the latest in a series of leverage buyouts to fall through since the crisis began.

"Unfortunately Clear Channel points to the fact that there are going to be some deals ... on the private side that might not get done because of the credit markets and the tightness there," said Arthur Hogan, chief market analyst at Jefferies & Co in New York.

"So it's not just going to be Clear Channel today. The rest of the LBO names are probably going to come under pressure."

Clear Channel shares fell 19.4 percent after the close on Tuesday and were trading down more than 21 percent to $25.50 before the bell.

S&P 500 futures SPc1 were down 5.40 points, below fair value, a formula to evaluate pricing taking into account interest rates, dividends and time to expiration on contract. Dow Jones industrial average futures DJc1 fell 45 points, while Nasdaq futures NDc1 shed 4.75 points.

Futures briefly trimmed losses after Motorola (MOT.N) said it would look at breaking itself into two. The stock rose 7.1 percent to $10.45 before the bell.

U.S. stocks had rallied on Monday as JPMorgan Chase & Co (JPM.N) quintupled its buyout offer for beleaguered Wall Street investment bank Bear Stearns BSC.N.

Confidence also found a boost last week from unexpectedly strong quarterly results from Goldman Sachs (GS.N), Morgan Stanley (MS.N), and Lehman Brothers LEH.N.

But an unexpectedly sharp drop in consumer confidence to a five-year low jolted that rally and hurt the dollar, fueling a rebound in commodity prices following last week's selloff. (Editing by James Dalgleish)