By Adam Haigh Nov. 19 (Bloomberg) -- U.S. stock-index futures dropped as investors speculated the economic slump will deepen without a bailout package for carmakers, while a report today may show builders broke ground on the fewest houses since at least 1959. General Motors Corp. retreated 2.6 percent in Germany as Chief Executive Officer Rick Wagoner said the auto industry needs aid to help it keep jobs and make it an engine for future U.S. prosperity. Ford Motor Co. slipped 1.8 percent. Caterpillar Inc. declined 1.1 percent before the government's figures on October new-home starts and building permits. ``The stock market is very pessimistic and very sensitive to bad news,'' said Guillaume Duchesne, a Geneva-based equity strategist at Fortis Private Banking, which oversees about $117 billion. ``There's a sense of urgency from GM. The U.S. economy isn't ready to accept another bankruptcy,'' he told Bloomberg Television in an interview. Futures on the Standard & Poor's 500 Index expiring in December sank 1.7 percent to 851.9 at 9:39 a.m. in London. Dow Jones Industrial Average futures lost 1.5 percent to 8,370 and Nasdaq-100 Index futures decreased 1.9 percent to 1,152. Stocks fell in Europe and Asia as concern mounted the economic slowdown will cut profits at financial firms and commodity producers. The Dow Jones Stoxx 600 Index slumped 2 percent, while the MSCI Asia Pacific Index slipped 0.8 percent. The S&P 500 has declined 42 percent in 2008, on course for its worst year since 1931, as writedowns and credit losses topped $966 billion in the worst financial crisis since the Great Depression, pushing the global economy toward a recession. Earnings Estimates Profits dropped 17 percent on average at companies in the index that have reported third-quarter results, according to Bloomberg data. Analysts expect an 8.5 percent decline in full- year earnings, based on estimates compiled by Bloomberg. General Motors declined 2.6 percent to $3.01 in German trading. Wagoner, who with fellow auto-industry leaders is urgently seeking a slice of the $700 billion bailout package, told the Wall Street Journal he had cut costs and invested billions of dollars in fuel-efficient vehicles and technologies. Congressional Democrats propose tapping the recently enacted $700 billion financial-rescue package for the aid. President George W. Bush and Senate Republicans said they oppose that approach and instead prefer using $25 billion that was earlier approved by Congress to retool auto plants. Ford, the second-biggest U.S. automaker, slid 1.8 percent to $1.65 in German trading. Economy Watch A Commerce Department report will probably show new-home starts in October dropped to a 780,000 annual pace, the lowest level since records began in 1959, according to economists surveyed by Bloomberg. The cost of living in the U.S. probably slid in October by the most in almost six decades as fuel costs plummeted and retailers discounted merchandise to entice shell-shocked customers, economists said before another government report. Caterpillar, the world's largest construction company, lost 1.1 percent to $35.77 in Germany. For Related News: To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net.

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