US stock index futures retreat before consumer confidence data

U.S. stock index futures declined, sending strong signal the Standard & Poor’s 500 Index will drop for a second day, as investors awaited data that may show consumer confidence retreated from high levels and tension grew over possible military action in Syria.

Futures on the S&P 500 expiring in September retreated 0.6% to 1,644.9 at 6:51 a.m. in New York. The benchmark gauge fell 0.4% yesterday after Secretary of State John Kerry said the U.S. will hold Syria’s government accountable for using chemical weapons. Contracts on the Dow Jones Industrial Average dropped 74 points, or 0.5 percent, to 14,857 today. Nasdaq also slumped by 0.5%.

“We have seen a little bit of a pullback in risk appetite when it applies to equities,” Russ Koesterich, the chief investment strategist at New York-based BlackRock Inc., said in a television interview on Bloomberg TV channel. “The recovery is gaining momentum but it is very predicated on a recovering housing market.”

Markets were also undermined by a report the U.S. will hit its debt limit in October, meaning investors could be in for another long battle in Congress. Craig Erlam, market analyst at Alpari (UK) Ltd., said in emailed comments to Wall Street Journal that markets are concerned about further spending cuts being prompted by negotiations between Democrats and Republicans.

At 10 a.m. EDT, the Conference Board will release consumer-confidence data. Economists polled by MarketWatch expect the index to fall to 78.0 in August from 80.3.

In corporate world, Cisco, the world’s biggest maker of networking equipment, lost 1 percent to $23.60 in pre-market New York trading. Microsoft, the largest software maker, fell 0.8% to $33.86.

J.C. Penney slumped 3.6% to $12.87 in German trading as Pershing raised $504 million selling 39.1 million shares in the department-store chain at $12.90 apiece. The retailer came under pressure in pre-market trading after news that activist investor Bill Ackman is selling his entire stake in the retailer came late the prior session.

Tiffany gained 0.2% to $81.85 in German trading. The world’s second-largest luxury jewelry retailer is scheduled to report second-quarter earnings today.