Stock futures point to opening plunge on Wall Street

NEW YORK -- Stocks were set to plunge at the opening of trading Monday as investors around the world fear consumers aren't lifting the economy into recovery.

U.S. stock futures fell sharply Monday after overseas markets extended the heavy selling that began on Wall Street Friday. That pullback followed a weaker than expected reading on consumer confidence.

The Shanghai stock market fell almost 6% and the major indexes in Europe were all down more than 1.5%.

Japan's Nikkei stock average fell 3.1% as investors weren't satisfied by news that the country had emerged from recession in the second quarter. In afternoon trading, Britain's FTSE 100 fell 1.9%, Germany's DAX index fell 2.2%, and France's CAC-40 fell 2.5%.

Oil prices also continued to fall sharply, reflecting growing concern about a weak economy that will curtail demand for energy.

Dow Jones industrial average futures were off more than 200, or 2.2%, overnight, although they were coming back a bit after 8 a.m. ET.

After rallying for months on expectations of an economic recovery, investors are now worried that they have been too optimistic given consumers' continuing reluctance to spend.

Friday's drop on Wall Street was triggered by a sharp drop in the Reuters/University of Michigan consumer sentiment index, which followed a surprisingly weak July retail sales report from the Commerce Department. While other parts of the economy, including housing and manufacturing, are showing signs of progress, the country cannot have a strong recovery unless consumers are spending more freely. Their spending accounts for more than two-thirds of economic growth.

Traders will get more insight into consumers' mindset as retailers report second-quarter earnings this week. Last week, the nation's largest retailer, Wal-Mart Stores, said its most important sales figure, those from stores open at least a year, fell during the April-June period.