* May U.S. non-farm payrolls well short of expectations
* China PMI falls
* Futures off: Dow 203 pts, S&P 23.8 pts, Nasdaq 42.5 pts
By Chuck Mikolajczak
NEW YORK, June 1 Wall Street was set to tumble
on Friday after U.S. jobs growth showed an anemic addition to
the workforce, compounding worries over soft Chinese factory
data and triggering fears of global recession.
The Labor Department said employers created a paltry 69,000
jobs last month, the weakest in a year, and the unemployment
rate rose to 8.2 percent. Economists polled by Reuters had
expected non-farm payrolls to increase 150,000.
China's economy showed signs of a broadening slowdown as its
official purchasing managers' index fell to 50.4 in May from
April's 13-month high of 53.3, signaling a deeper-than-forecast
deterioration in demand at home and abroad.
"It's a continuation of the slowdown in the economic numbers
we've been seeing domestically over the last couple of months,"
said Darrell Cronk, regional chief investment officer for Wells
Fargo Private Bank in the Northeast, in New York.
"I would expect a relatively ugly day in the markets."
S&P 500 futures fell 23.8 points and were well below
fair value, a formula that evaluates pricing by taking into
account interest rates, dividends and time to expiration on the
contract. Dow Jones industrial average futures dropped
203 points, and Nasdaq 100 futures lost 42.5 points.
In Europe, Markit's Eurozone Manufacturing Purchasing
Managers' Index dropped to 45.1 in May from 45.9 in April.
Banking shares dropped in premarket, with JPMorgan Chase &
Co down 2.4 percent to $32.34 and Banc of America Corp
down 3.1 percent to $7.12. The Select Sector SPDR
Financial ETF lost 2.2 percent.
Investor concern has been rising about the stability of
Spain's banking system and the euro zone as a whole, at the same
time U.S. data has shown tepid economic growth.
The worries sent the benchmark S&P 500 index down 6.3
percent in May and investors fleeing to safe-haven government
European shares fell to a fresh five-month low on growing
signs that the debt crises in Spain and Greece were hurting the
region's biggest economies. The FTSEurofirst 300 index
was down 2.3 percent.