BLBG:Stocks in Europe Fall on Delay in EFSF Bond Sale; Treasuries, Dollar Drop
European stocks fell as the euro-area rescue fund was said to delay a bond sale. U.S. index futures were little changed, while the dollar and Treasuries retreated before the Federal Reserve’s latest policy statement.
The Stoxx Europe 600 Index lost 0.5 percent at 10 a.m. in London. Standard & Poor’s 500 Index futures slipped less than 0.1 percent, following a 2.8 percent slump in the U.S. stocks gauge yesterday. The Dollar Index declined 0.3 percent to 77.008, snapping a three-day advance, and Treasury 10-year yields gained five basis points, the first increase in four days. Italian 10-year bonds rose, narrowing the yield difference with benchmark German bunds by eight basis points to 434.
The European Financial Stability Facility will delay its planned 3 billion-euro ($4.1 billion) bond sale because of market conditions, according to two people with knowledge of the deal. European leaders are due to hold emergency talks with Greek Prime Minister George Papandreou in Cannes, France, on the eve of a Group of 20 summit. The Fed is probably engineering a third round of asset purchases, even as a decision is unlikely to be announced today, economists surveyed by Bloomberg said.
The S&P 500 fell for a second day yesterday. Sixty-nine percent of economists surveyed by Bloomberg say Fed Chairman Ben S. Bernanke will start a third round of quantitative easing, or QE3, with 36 percent predicting the move in the first quarter of next year, according to a poll of 42 economists from Oct. 26-31.
Two shares declined for every one that gained in the Stoxx 600, which extended a three-day, 5.8 percent loss. Logica Plc sank 7.4 percent as the Anglo-Dutch computer services provider cut its sales-growth forecast.
German bund yields were three basis points higher after dropping 26 basis points yesterday, the biggest decline since Bloomberg began collecting the data in 1992. Greek two-year yields rose 141 basis points to 88.69 percent, after climbing to a record 88.81 percent yesterday.
The euro strengthened 0.5 percent to $1.3765, after gaining as much as 0.7 percent. The dollar weakened 0.3 percent to 78.05 yen.
Copper climbed 2.5 percent as inventories of the metal in warehouses monitored by the London Metal Exchange dropped for a 10th consecutive day, the longest decline since July 6. New York oil rose 0.3 percent to $92.49 a barrel, the first gain in four days.
The MSCI Emerging Markets Index rose 0.5 percent, following its worst two-day decline in a month. The Hang Seng China Enterprises Index climbed 2.6 percent in Hong Kong.
To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net
To contact the editor responsible for this story: Stuart Wallace at swallace6@bloomberg.net