U.S. stock index futures dropped in active late afternoon trade and closed near daily lows.
    The selloff followed an early rally that had sent June S
and P 500s to a new contract high of 306.10. Arbitrage buy
programs were triggered when the June S and P reached a 3.20
point premium over the spot index, traders said.
    However, weakness in the bond market in afternoon trade
sparked selling in June S and Ps, sending the nearby contract
to a discount which triggered the unwinding of buy programs,
traders said. June S and Ps fell through chart support at
296.00 which also sparked technical selling.
    Value Line futures closed down 6.85 to 7.00, S and P 500
futures fell 7.65 to 7.85, NYSE futures dropped 4.60, and MMI
futures ended 10.65 to 11.00 points lower.

 Reuter
