By Adam Haigh Dec. 5 (Bloomberg) -- European stocks tumbled for a third day this week after employers in the U.S. cut jobs last month at the fastest pace in 34 years, signaling the world’s largest economy is slipping deeper into recession. ING Groep NV, Credit Suisse Group AG and Siemens AG sank more than 5 percent after job losses in the U.S. exceeded forecasts. BHP Billiton Ltd. slid 8 percent as copper fell for a seventh day, its longest losing streak in 10 years. BP Plc and Total SA retreated more than 6 percent after crude touched $42 a barrel, heading for its worst week since March 2003. The Dow Jones Stoxx 600 Index lost 3.8 percent to 189.84, with all 19 industry groups decreasing. The measure dropped 8 percent this week, wiping off more than two-thirds of last week’s record advance, as reports signaled the global economy is deteriorating and U.S. unemployment reached the highest level since 1993. “This is a horrendous number and it’s a further indication for just how bad things have got,” said Henk Potts, a London- based fund manager at Barclays Stockbrokers, which has about $45 billion under management. “The risk is that sentiment begins to worsen even more now as the outlook for equity markets shows no signs of improving.” Stocks fell to the lows of the day after mortgage delinquencies and foreclosures in the U.S. climbed to records. The share of mortgages 30 days or more overdue rose to a seasonally adjusted 6.99 percent while loans already in foreclosure rose to 2.97 percent, both all-time highs in a survey that goes back 29 years, the Mortgage Bankers Association said. Unemployment Climbs The European Central Bank cut its benchmark interest rate yesterday by the most in the bank’s 10-year history after record declines in European and Chinese manufacturing and more job losses in the U.S. Payrolls shrank by 533,000 workers last month, the biggest loss since December 1974, after decreasing a revised 320,000 the prior month, the Labor Department said today. The German economy, Europe’s largest, will contract the most in 16 years in 2009 as the global slowdown hits exports, the Bundesbank said today. “There is a vice-like grip on the market,” said Manus Cranny, a London-based equity market analyst at MF Global. “We have given up any ideas of an optimistic view” for stocks, he told Bloomberg Television. More than $31 trillion has been erased from the value of global equities this year as the U.S. mortgage market collapsed, freezing credit and pushing the U.S., Japan, Germany and the U.K. into recessions. Debt losses and writedowns by the world’s largest lenders and insurers have approached $1 trillion in the worst financial crisis since the Great Depression. National Markets National benchmarks fell in all 18 western European markets except Iceland. The FTSE 100 lost 2.7 percent, as Royal Dutch Shell Plc and Antofagasta Plc retreated. France’s CAC 40 declined 5.5 percent, while Germany’s DAX decreased 4 percent. Stocks in Europe may fall another 20 percent in the “short term” as investors grasp the possibility of deflation, Goldman Sachs Group Inc. said in a note dated today. “Remain defensive,” strategists including Jessica Binder wrote in the report. “The start of 2009 is unlikely to bring a change in the dynamic of growth.” The personal and household goods industry was downgraded to “underweight” from “neutral” by the brokerage, which cited weaker consumer demand. Basic-resources shares were lowered to “neutral” from “overweight” on expectations of cuts to capital expenditure and dividends. Job Losses ING, the largest Dutch financial-services company, slid 8.2 percent to 5.96 euros. Credit Suisse, the second-biggest Swiss bank, retreated 5.5 percent to 28.82 francs. Siemens, the region’s largest engineering company, declined 6.2 percent to 44.80 euros. November’s job losses in the U.S. exceeded all estimates in a Bloomberg News survey of 73 economists. The jobless rate rose to 6.7 percent, the highest level in 15 years. BHP, the world’s largest mining company, fell 8 percent to 975.5 pence. Antofagasta, the copper producer controlled by Chile’s Luksic family, lost 4.6 percent to 370.25 pence. Copper dropped as much as 8.5 percent to $2,991 a metric ton in London. The metal for delivery in three months has fallen more than 18 percent in seven trading sessions on concern producers haven’t cut output enough to counter demand weakness in China and the U.S., the largest consumers of industrial metals. Crude Oil BP, Europe’s second-largest oil producer, sank 6.6 percent to 478 pence. Shell, the region’s biggest, declined 6 percent to 1,562 pence. Total, the third-largest energy company, retreated 8.9 percent to 35.66 euros. Oil fell as much as $2.82, or 6.5 percent, to $40.85, the lowest in four years, after dropping 6.7 percent yesterday. TNT NV, Europe’s second-biggest express-delivery company, sank 5.5 percent to 14.14 euros. Deutsche Bank AG lowered its recommendation on the shares to “sell” from “hold” and reduced its price estimate 20 percent to 12 euros. The broker said an investor day yesterday highlighted how express volumes had declined significantly and look set to continue into 2009, London-based analyst Andy Chu wrote in a note to clients. Berkeley Group Holdings Plc advanced 1.5 percent to 800 pence after the U.K.’s largest homebuilder by market value eliminated its debt and built up cash even as a housing slump cut first-half profit. To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net

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