Aug. 24 (Bloomberg) --- U.S. equity-index futures fell and Treasury bonds rose for the first time in three days amid concern the global economy is stalling. The yen rose even as Japan took steps to help companies cope with the currency’s strength, while European shares swung between gains and losses. Standard & Poor’s 500 Index futures decreased 1 percent as of 9:03 a.m. in London after a 3.4 percent jump in the gauge yesterday. The Stoxx Europe 600 Index rose 0.1 percent and earlier lost 0.6 percent. Treasury 30-year yields slid five basis points. The yen erased an earlier drop against its U.S. counterpart and climbed 0.3 percent versus the euro. Gold added 0.8 percent. Crude oil halted two days of gains. Federal Reserve Chairman Ben S. Bernanke and other central bankers will meet this week in Jackson Hole, Wyoming amid signs of a faltering U.S. recovery. Data today showed German business confidence deteriorated to its lowest level in more than a year, while a report may show U.S. business-equipment demand fell. Moody’s Investors Service cut Japan’s credit rating by one step, saying “weak” prospects for growth will make it difficult for the government to rein in the world’s largest public debt burden. “No doubt the Fed will signal that it remains ready to do whatever it can to support growth,” said Stephen Halmarick, Sydney-based head of investment markets research at Colonial First State Global Asset Management, which oversees about $150 billion. “But stock markets will remain volatile because it remains clear that the pace of growth in the developed world is slowing significantly.” U.S Slowdown Futures expiring in September indicate the S&P 500 may snap yesterday’s 3.4 percent rally. Durable goods orders excluding transportation equipment fell 0.5 percent in July after a 0.4 percent gain in June, according to the median forecast of economists surveyed by Bloomberg News before a Commerce Department report today. Data from the same agency on Aug. 26 may show the economy grew 1.1 percent in the second quarter, compared with a previous estimate of 1.3 percent. Bernanke is scheduled to deliver an address on Aug. 26 at an annual conference sponsored by the Fed Bank of Kansas City. His hint of a second round of asset purchases, or quantitative easing, during the same event last year spurred an eight-month rally in the S&P 500. Yields on Treasury 10-year notes fell four basis points to 2.12 percent, while the rate on 30-year Treasuries dropped to 3.45 percent. Unresolved Uncertainties “The uncertainties that have gripped investors in recent weeks haven’t been resolved at all,” said Yoo Byung Ok, a Seoul-based fund manager at UBS Hana Asset Management Co., which manages about $17 billion. “Even if QE3 is announced, I don’t think investors will cheer that unless it’s very strong.” MSCI’s Asia Pacific Index dropped 1.3 percent after earlier gaining as much as 0.7 percent. The gauge, which jumped yesterday by the most since March 22, is down 13 percent this year. Valuations fell to as low as 11.8 times estimated profits this week, the lowest since November 2008, according to data compiled by Bloomberg. China Life Insurance Co. sank 12 percent in Hong Kong after the company said first-half profit declined 28 percent from a year earlier. Malaysian Airline System Bhd. dropped 3.7 percent in Kuala Lumpur after the carrier posted a second consecutive quarterly loss. About three shares climbed for every two that fell on the Stoxx 600. WPP Plc (WPP), the world’s biggest advertising agency, climbed 2.2 percent after reporting earnings that beat estimates. Heineken NV tumbled 13 percent after the world’s third-largest brewer by volume said full-year profit is unlikely to grow. Japan’s Rating The Markit iTraxx Japan index rose seven basis points to 153 basis points, Deutsche Bank AG prices show. That will be the highest since June 10, 2010, according to CMA. Five-year contracts on Japan’s sovereign debt climbed 2.5 basis points to 111.5, Deutsche Bank prices show. Moody’s cut the government’s sovereign-credit rating to Aa3, with a stable outlook. The company put the nation’s rating on review for a downgrade in May, calling on the government to step up its efforts to narrow the budget gap. The yen traded at 76.65 per dollar after earlier falling to as weak as 76.87, and compares with a post-World War II record of 75.95 reached on Aug. 19. The Japanese currency climbed 0.3 percent to 110.36 per euro even after the government unveiled a $100 billion effort to cope with persistent strength in the currency that threatens to thwart the nation’s recovery from three straight quarters of economic contraction. Officials will release $100 billion to fund loans by Japan Bank for International Cooperation, Finance Minister Yoshihiko Noda told reporters today in Tokyo. JBIC, as the lender is known, is a state-run export credit agency. ‘Another Whimper’ “This is just another whimper from the Japanese authorities and to say it’s unimpressive you just have to look at the price action in dollar-yen,” said Robert Rennie, chief currency strategist in Sydney at Westpac Banking Corp., Australia’s second-largest lender. “I’m not particularly impressed by the announcements and I don’t think the foreign- exchange market is particularly impressed.” The New Zealand dollar sank 1 percent to 82.77 U.S. cents, halting two days of gains. The euro slid to $1.4403, after touching $1.45 yesterday, its highest since Aug. 17. The Ifo institute in Munich’s business climate index, based on a survey of 7,000 executives, declined to 108.7 in August from 112.9 in July. Gold for immediate delivery climbed to $1,850.23 an ounce. Bullion yesterday reached a record $1,913.50 before retreating 3.7 percent. Oil for October fell 0.8 percent to $84.73 a barrel after a two-day rally on the New York Mercantile Exchange. The industry- funded American Petroleum Institute said supplies fell 3.34 million barrels to 347 million last week. An Energy Information Administration report today may show inventories climbed for a second week, according to a Bloomberg News survey. To contact the reporters on this story: Shiyin Chen in Singapore at schen37@bloomberg.net; Shani Raja in Sydney at sraja4@bloomberg.net To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net

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