By David Merritt April 16 (Bloomberg) -- Emerging-market stocks fell the most in a month after China acted to cool real-estate speculation and Google Inc. reported results that disappointed investors. The yen strengthened and the pound declined. The MSCI Emerging Markets Index dropped 0.8 percent at 10:38 a.m. in London, and futures on the Standard & Poor’s 500 Index declined 0.2 percent. The Shanghai Stock Exchange Composite Index slid 1.1 percent. The yen gained against all 16 of its most-traded peers while the pound weakened versus 14 of the 16. Google shares fell 4.2 percent in Europe as investors questioned whether the S&P 500’s 8.7 percent gain this year is justified by prospects for earnings as central banks start to withdraw stimulus measures. China today raised requirements for down-payments on some home purchases. Federal Reserve Bank of San Francisco President Janet Yellen said yesterday that while the U.S. is “on the right track,” it’s “important not to lose sight of just how fragile this recovery is.” “Risk has been sold heavily after Google’s results fell short of expectations,” said Adam Cole, head of global currency strategy at Royal Bank of Canada in London. “Speculation on an imminent policy tightening in China is ongoing and further diminishing appetite for risky assets and currencies.” The Shanghai Composite’s decline was the biggest in three weeks. China Overseas Land & Investment Ltd., controlled by the country’s construction ministry, lost 4.8 percent in Hong Kong. Thailand’s SET Index retreated 2.7 percent to its lowest level in a month after the government said the nation’s deadliest political clash in 20 years may hurt growth. Volcano Disruption The MSCI World Index of 23 developed nations’ stocks fell 0.1 percent and the MSCI Asia Pacific Index declined 0.7 percent, retreating from a 20-month high. Sony Corp., which gets 23 percent of its sales in the U.S., sank 1.8 percent in Tokyo. British Airways Plc dropped 1 percent in London while Air France-KLM Group lost 1.7 percent in Paris as a cloud of ash from a volcano in Iceland shut airports in northern Europe for a second day. British airspace will be restricted until at least 1 a.m. tomorrow, according to flight-control authority National Air Traffic Services. Ten airports in Germany were shut, according to the DFS air traffic control agency. U.S. Earnings Google, owner of the most popular search engine, reported first-quarter profit that fell short of some analysts’ estimates as ad sales failed to grow enough to satisfy investors. General Electric Co. and Bank of America Corp. are among companies reporting before the market opens today in New York. South Africa’s rand led declines among emerging-market currencies, weakening 0.6 percent against the dollar, after the central bank approved easing rules that govern the ability of companies to enter into forward-exchange contracts to hedge against currency risk. The yen appreciated 0.5 percent against the euro to trade at its strongest level since April 9 and strengthened 0.4 percent versus the dollar as investors sought the relative safety of the Japanese currency. The dollar advanced 0.1 percent against the euro. The pound fell versus the dollar for the first day in four as polls on the U.K.’s first televised campaign debate signaled neither of the biggest parties has enough support for a clear majority at the May election. Greek Bonds Fall Greece’s 10-year bonds fell for a fourth day as the nation moved closer to asking for emergency aid to avoid a default, with European Union finance ministers meeting in Madrid today to discuss how to curb swelling budget deficits. The yield premium investors demand to hold the securities instead of benchmark German bunds widened 15 basis points. The cost of insuring against a Greek default rose, with credit-default swaps climbing 7 basis points to 426, according to CMA DataVision prices. Zinc for delivery in three months rose as much as 1.6 percent to $2,550 a metric ton on the London Metal Exchange, the highest since Jan. 14. Gold fell 0.2 percent to $1,156.72 an ounce. Crude oil slipped 0.7 percent to $84.92 a barrel in New York trading. --With assistance from Stuart Wallace, Steve Voss, Stephen Kirkland, Paul Dobson and Paul Armstrong London. Editors: Justin Carrigan,

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