By Adam Haigh March 10 (Bloomberg) -- European stocks declined to their lowest level since January as Moody’s Investors Service cut Spain’s credit rating and export growth slowed in China, raising concern that the global economic recovery will falter. U.S. stock-index futures and Asian shares slid. Home Retail Group Plc slumped 6.8 percent after lowering its full-year pretax profit forecast. Commerzbank AG lost 2.6 percent as Financial Times Deutschland reported that Germany’s second-largest lender may raise as much as 7 billion euros ($9.7 billion) to help repay government aid. BHP Billiton Ltd. led raw-material shares to the biggest decline among all 19 industry groups on the Stoxx Europe 600 Index. The Stoxx 600 dropped 0.7 percent to 279.15 at 12:04 p.m. in London. The gauge has lost 4.1 percent since reaching a 2 1/2-year high on Feb. 17 as crude oil surged amid fighting between Libyan rebels and their ruler for the last 41 years, Muammar Qaddafi, increasing concern that higher energy costs will choke off the economic recovery. “After horrific trade numbers out of China overnight, which show that the engine of world growth might be slowing down dramatically and another downgrade of a sovereign European nation, the ‘buy the dip’ attitude which has reigned over the last two years has started to look wobbly,” said Lex van Dam, London-based fund manager at Hampstead Capital LLP, which oversees $500 million. Futures contracts on the Standard & Poor’s 500 Index expiring this month slid 0.5 percent. The MSCI Asia Pacific Index retreated 1.5 percent. Spain’s Credit Rating Spain’s rating was downgraded to Aa2 by Moody’s, which said that the cost of supporting the country’s banks will exceed the government’s estimates. The ratings company has a negative outlook on the country’s debt. German Chancellor Angela Merkel has said she will do “whatever is needed to support the euro,” and promised that meetings scheduled for March 11 and on March 24 and 25 will produce a “comprehensive” solution to the crisis. French President Nicolas Sarkozy said monetary union is so important “that we will be there whenever it needs to be defended.” “It makes sense to be nervous,” said Nick Nelson, a London-based equity strategist at UBS AG. “We have seen lead indicators peak, oil prices rise and we await the outcome of EU meetings that will lead -- or not -- to a comprehensive solution for the sovereign-debt crisis.” China’s Trade Deficit China reported an unexpected $7.3 billion trade deficit, the biggest in seven years. The nation’s exports rose at the slowest pace since November 2009. German exports unexpectedly declined in January after gaining in the previous two months, the Federal Statistics Office in Wiesbaden said today. Concern remains that supply disruptions in Libya, Africa’s third-largest producer, may spread to the Arabian peninsula. Warplanes sent from Qaddafi’s home region of Sirte struck the Ras Lanuf refinery, the country’s largest crude processing plant, Al Jazeera television said. The nation’s largest oil terminal, at the port of Sidra, was hit and part was in flames, Al Jazeera said. The Bank of England held its benchmark interest rate at a record low as policy makers set aside their concerns on rising inflation to support the U.K.’s economic recovery. The Monetary Policy Committee, led by Governor Mervyn King, kept the rate at 0.5 percent for a 25th month, as predicted by all 61 economists in a Bloomberg News survey. Stoxx 600 Earnings Even after a retreat in equities since mid-February, the Stoxx 600 has still surged 77 percent since reaching a 12-year low two years ago as governments and central banks pumped more than $12 trillion into the financial system to help the recovery from the worst global recession since the 1930s. Fifty-six percent of Stoxx 600 companies that have announced earnings since Jan. 10 have beaten the average analyst estimate for per-share profit. The gauge is valued at about 13.7 times the reported earnings of its companies, close to the cheapest multiple since March 2009, when the measure reached its lowest level in more than 12 years. Home Retail sank 6.8 percent to 196.5 pence. The company projected that its “benchmark” pretax profit for the year ended on Feb. 26 will have reached 255 million pounds ($412.6 million) at most, as trading at its Argos catalog stores was “more difficult and volatile than we anticipated.” In January, Chief Executive Officer Terry Duddy predicted that pretax profit would reach 265 million pounds. Commerzbank, BHP Billiton Commerzbank lost 2.6 percent to 5.98 euros. The lender will test the market’s appetite for a possible capital increase of as much as 7 billion euros in May or June to help repay government aid, Financial Times Deutschland reported. Separately, the lender said it sold 1.25 billion euros of subordinated notes as it prepares for new capital rules. BHP Billiton, the world’s biggest mining company, declined 3.2 percent to 2,307 pence. Rio Tinto lost 3.6 percent to 3,943 pence. Copper, lead, nickel and zinc prices retreated on the London Metal Exchange. ARM Holdings Plc slumped 5.9 percent to 540 pence after JPMorgan Chase & Co. said the designer of chips that power Apple Inc.’s iPhone is most at risk if demand for tablet computers decreases. ARM shares rose 151 percent in the 12 months through yesterday, leaving the stock valued at 59 times earnings before interest, taxes, depreciation and amortization, more than the multiple for any semiconductor takeover since ATI Technologies Inc. in 2006, according to data compiled by Bloomberg that includes net debt. Standard Life, Delhaize Standard Life Plc retreated 5.3 percent to 231.7 pence. its largest slide since last May, after Scotland’s biggest insurer reported that its cash generation dropped 6 percent in 2010, falling short of analysts’ estimates. The former mutual society spent about 200 million pounds last year on technology for its savings products. Delhaize Group SA surged 3.1 percent to 59.20 euros, its highest price since last July. The owner of the U.S. Food Lion supermarkets said fourth-quarter net income advanced to 190 million euros, beating the 161 million-euro average of nine analyst estimates compiled by Bloomberg. Delhaize said that cost savings and improved buying terms in Belgium and Greece exceeded the impact of price cuts in the U.S. --With assiatance from Adam Ewing in Stockholm. Editor: Will Hadfield To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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