European (SXXP) stock futures advanced, indicating the Stoxx Europe 600 Index will rebound from yesterday’s drop, after European Union leaders called for Greece to stick with budget cuts to stay in the euro, while offering no relief for Spain. U.S. futures and Asian shares fell. Futures on the Euro Stoxx 50 Index, a benchmark for the euro region, rose 0.8 percent to 2,139 at 7:06 a.m. in London. Contracts on the U.K.’s FTSE 100 Index gained 0.7 percent. Standard & Poor’s 500 Index futures retreated 0.2 percent, while the MSCI Asia Pacific Index also lost 0.2 percent. European stocks slid the most in a month yesterday after a report cited Greece’s former Prime Minister Lucas Papademos as saying that while it is unlikely the nation will leave the euro, it’s still a risk. The euro was 0.3 percent from the lowest level since July 2010 after German Chancellor Angela Merkel said following a European Union meeting that her nation stands by its opposition to jointly issued common bonds. The 18th summit in more than two years of crisis fighting was marked by new French President Francois Hollande’s challenge to the German-dominated deficit-cutting orthodoxy that has failed to stabilize the euro area and led to speculation that Greece might be forced out. Stronger Co-operation Speaking to reporters in Brussels, Merkel said that “much stronger economic cooperation� in the region is needed before euro bonds can be issued. European Council President Herman Van Rompuy said leaders are not under any pressure to introduce the bonds. “We had a not unheated discussion on euro bonds,� Luxembourg Prime Minister Jean-Claude Juncker told reporters in Brussels early today after six hours of talks. Juncker, who heads a group of European finance ministers, also said he didn’t ask the 17 members of the currency bloc to prepare contingency plans for the possibility of Greece leaving the euro. An inconclusive May 6 ballot in Greece raised speculation it will scuttle austerity measures imposed upon the nation after two bailouts and have to leave the euro. New elections are scheduled for June 17. Leaders gave European Union President Herman Van Rompuy the job of sketching out “building blocks� for a more integrated euro region by the next summit on June 28-29. German Confidence In Germany, the Ifo institute’s business climate index, based on a survey of 7,000 executives, will drop to 109.4 from 109.9 in April, according to the median forecast of 37 economists in a Bloomberg News survey. China’s manufacturing may shrink for a seventh month in May, a private survey showed, reinforcing the need for stimulus as Premier Wen Jiabao accelerates a shift in policy to support growth. The 48.7 preliminary reading for a purchasing managers’ index released by HSBC Holdings Plc and Markit Economics today compares with a final 49.3 for April. The Chinese government yesterday signaled a commitment to boosting the economy, saying it must use policy tools for “stable and relatively fast economic growth.� The statement builds on Premier Wen Jiabao’s comments on May 20 pledging a bigger focus on bolstering growth. To contact the reporter on this story: Peter Levring in Copenhagen at plevring1@bloomberg.net To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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