European stock futures slid, indicating the Stoxx Europe 600 Index may decline from a two- week high, as two Federal Reserve officials said the central bank shouldn’t act to protect equity investors. U.S. futures and Asian shares retreated.
Banks may be active after a report that U.S. regulators are stepping up scrutiny of local operations for Europe’s largest lenders on concern that the sovereign debt crisis may lead to funding problems. SABMiller Plc (SAB) may move as Foster’s Group Ltd. rejected its A$9.5 billion ($10.1 billion) takeover bid as too low. Holcim Ltd. (HOLN) might retreat as the world’s second-biggest cement maker reported profit that missed estimates.
Futures on the Euro Stoxx 50 Index expiring in September dropped 1.4 percent to 2,297 at 7:26 a.m. in London, while FTSE 100 Index futures sank 1 percent. The MSCI Asia Pacific Index fell 1.3 percent and Standard & Poor’s 500 Index futures declined 0.7 percent after the benchmark gauge for U.S. equities increased 0.1 percent yesterday.
“European equity markets are set to open lower as uncertainty over global growth and the euro-zone debt crisis continue to weigh on sentiment,” said Jonathan Sudaria, a trader at London Capital Group.
The Stoxx 600 has climbed 6.5 percent from this year’s low on Aug. 10, reducing the decline from this year’s peak on Feb. 17 to 18 percent.
Plosser, Fisher
Federal Reserve Chairman Ben S. Bernanke’s pledge last week to keep interest rates near zero until mid-2013 was “inappropriate policy at an inappropriate time,” Charles Plosser, president of the Fed Bank of Philadelphia, said yesterday in a Bloomberg Radio interview.
Dallas Fed President Richard Fisher said the central bank shouldn’t enact policy to protect stock investors. Both officials dissented from the Fed’s Aug. 9 statement.
A report at 8:30 a.m. in Washington may show the number of new U.S. job seekers applying for unemployment insurance rose by 5,000 to 400,000 in the week ending Aug. 13, according to a Bloomberg survey of economists.
Separate releases at 10 a.m. may show that sales of previously owned houses climbed to a 4.9 million annual pace in July from a seven-month low in June and the Conference Board’s index of leading U.S. indicators grew 0.2 percent last month after a 0.3 percent gain the prior period.
Banks May Move
European banks, which have underperformed the benchmark Stoxx 600 by 25 percentage points in the past year, may be active as the Wall Street Journal reported that U.S. regulators are stepping up scrutiny of local operations for Europe’s largest banks.
The Federal Reserve Bank of New York has been holding talks with the lenders and sought information about their access to funds to maintain operations in the U.S., the Journal said, citing people it didn’t identify. The regulator has also been asking some lenders to overhaul their structure, it said.
Swedish banks must do more to prepare for a deterioration in Europe’s debt crisis that could freeze interbank markets and cut off funding, said Lars Frisell, chief economist at the country’s financial regulator.
“It won’t take much for the interbank market to collapse,” Frisell said yesterday in an interview in Stockholm. “It’s not that serious at the moment but it feels like it could very easily become that way and that everything will freeze.”
SABMiller may move after the board of Australian brewer Foster’s rejected its takeover bid. The London-based brewer may have to raise its offer by 6 percent to A$5.20 a share to win over investors, according to the median estimate of 13 analysts surveyed by Bloomberg News.
Holcim may decline after reporting second-quarter net income of 347 million Swiss francs ($437 million), missing the 373.3 million-franc average estimate of seven analysts in a Bloomberg survey. Sales dropped 11 percent to 5.49 billion francs, compared with an estimate of 5.56 billion francs.
To contact the reporter on this story: Peter Levring in Copenhagen at Plevring1@bloomberg.net or
To contact the editor responsible for this story: Andrew Rummer in London at arummer@bloomberg.net;
