Stock futures point to lower open amid GM worries

NEW YORK (Reuters) - Stock futures pointed to a lower open on Wednesday on news that struggling automaker General Motors could be headed for bankruptcy, and before data on manufacturing, home sales and private sector employment.

Market watchers were also focused on the G20 meeting in London of leaders of the world's top economies to tackle the global economic crisis.

Shares of GM were flat in the premarket after trading lower following a New York Times report that the Obama administration is seeking to ease GM into a "controlled" bankruptcy by persuading some creditors to agree to a plan that would split the company into two pieces.

On Tuesday, GM said there was a rising chance it could file for bankruptcy by June. The comments came on the heels of the ouster of GM Chief Executive Officer Rick Wagoner and details of the U.S. administration's plans limiting taxpayer funds for automakers.

"It's hard medicine that GM is going to have to take," said Arthur Hogan, chief market analyst at Jefferies & Co in Boston.

S&P 500 futures fell 7.20 points and were 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 lost 56 points, and Nasdaq 100 futures gave up 14.25 points.

In the day's round of economic data, the ADP private U.S. employment report and readings on ISM manufacturing and pending home sales were on tap.

General Motors denied a report in London's Financial Times that it had approached the British government to discuss a 600 million pound ($859 million) aid package for its Vauxhall marque.

Analysts worry about what a bankruptcy in the auto sector would mean for the rest of the economy and the fallout on unemployment and other companies in the industry, but Hogan said a "controlled" bankruptcy could save jobs and keep the auto industry alive.

While U.S. President Barack Obama played down differences between Group of 20 leaders, Germany and France demanded tough action rather than weak compromises, highlighting the difficulties in reaching an accord on staving off recession and tightening regulation.

On Tuesday, stocks ended the quarter on a high note with the S&P 500 racking up its best month since October 2002 as investors snapped up top-performing bank and technology shares.

(Editing by James Dalgleish)