* China February trade balance drops
* Zoll Medical to be acquired for $2.21 billion
* Futures off: Dow 1 pt, S&P 2 pts, Nasdaq 4.75 pts
By Chuck Mikolajczak
NEW YORK, March 12 (Reuters) - U.S. stock index
futures edged lower on Monday as economic data in
China gave investors reason to pause after a three-day rally.
China's trade balance plunged $31.5 billion into the red in
February as imports swamped exports to leave the largest deficit
in at least a decade and fuel doubts about the extent to which
frail foreign demand or seasonal distortion drove the drop.
The data cast some doubt on global economic growth prospects
after Friday's U.S. payrolls report pointed to an improving
domestic economy and pushed equities to their fourth straight
Investors will also eye Tuesday's statement from the U.S.
Federal Open Market Committee for any indications in the
direction on monetary policy.
"With little fresh news to tip the scales either way, the
market is looking for the next theme to take hold - the market
is sitting right at a key resistance area looking for a push
through what has been a significant hurdle," said Andre Bakhos,
director of market analytics at Lek Securities in New York.
"The market has had a clear upside bias, and once this
hurdle is surpassed there is the potential for a surge higher,
perhaps to 1,440" for the S&P 500 index, Bakhos said.
China's central bank also said the country has ample room to
tweak policy to support credit growth in the face of volatile
foreign capital flows that will inevitably see market forces
play a greater role in determining the value of the yuan
S&P 500 futures fell 2 points and were slightly above
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 shed 1
point, and Nasdaq 100 futures lost 4.75 points.
Japan's Asahi Kasei Corp will buy U.S. medical
equipment maker Zoll Medical Corp for $2.21 billion as
Asahi Kasei looks to build a globally competitive healthcare
business and reduce its reliance on its chemicals and fiber
Molycorp Inc is set to buy Neo Material Technologies
Inc in a C$1.3 billion ($1.31 billion) cash-and-share
deal that will give Molycorp access to Neo's rare earth
processing capabilities and patents.
Youku Inc dropped 10 percent to $22.50 in premarket
after China's largest online video company said it will buy
second-ranked Tudou Holdings Ltd in an all-stock deal
valued at more than $1 billion. Tudou shares surged 117.8
percent to $33.52 in light premarket trade.
U.S. airline JetBlue Airways Corp has spoken to the
management of Aer Lingus about the possible purchase of
a stake in the Irish airline, the Irish Times newspaper reported
on Monday, citing informed sources.
Swiss watchmaker Swatch Group SA said Tiffany & Co
had served it with a 541.9 million franc ($590 million)
counter-claim in a legal dispute with the U.S. jeweler over a
severed cooperation agreement.
Federal prosecutors have nixed a tentative $1 billion
settlement with Johnson & Johnson, holding out for a
bigger settlement with the drugmaker for alleged improper
marketing of its Risperdal schizophrenia drug, the Wall Street
European stocks reversed early losses and turned slightly
positive on Monday, reviving a three-session rally as investors
shrugged off grim Italian economic growth data and the
triggering of Greek credit default swaps to chase euro-zone
banking stocks higher.
Asian shares fell as investors paused to assess the effect
of strong U.S. jobs data, which scaled back expectations of more
easing ahead of this week's Federal Reserve meeting, while
uncertainty over Chinese growth also weighed on sentiment.