BLBG:Stocks, Oil Decline On U.S. Data As Indian Rupee Slumps
European stocks fell for a second day and metals declined as a drop in German business confidence provided the latest evidence the global economy is slowing. U.S. equity index futures rose, signalling the Standard & Poor’s 500 Index will rebound from its second-biggest drop this year.
The Stoxx Europe 600 Index (SXXP) declined 0.5 percent at 6:10 a.m. in New York, while the MSCI Emerging Markets Index tumbled 1.6 percent. S&P 500 futures gained 0.4 percent, following a 2.2 percent slide on the gauge yesterday. India’s rupee weakened 1.6 percent to a record. The yield on the Italian 10-year bond rose six basis points to 5.81 percent. Copper dropped to the lowest price in six months.
German business confidence fell to a two-year low, the Munich-based Ifo institute said today after data yesterday showed that U.S. manufacturing shrank and home sales declined. Moody’s Investors Service cut ratings for Credit Suisse Group AG (CSGN) and 14 other banks, while the International Monetary Fund said Europe’s crisis has reached a “critical stage.”
“All indicators point to continued sliding prices,” a team led by Eugen Weinberg, head of commodities research at Commerzbank AG in Frankfurt, wrote today in a report. “Sentiment on the financial markets remains very gloomy, economic growth is set to slow even further.”
Credit Suisse
Three shares dropped for every one that rose on the Stoxx 600 as a gauge of chemical makers posted the biggest drop of the 19 industries in the equity benchmark. Solvay SA (SOLB) sank 5.4 percent after Citigroup Inc. recommended selling the shares, citing falling prices and demand for the Belgian company’s products. Clariant AG, the world’s largest maker of printing-ink chemicals, lost 3.1 percent. Lanxess AG slid 4.1 percent.
Credit Suisse retreated 1.8 percent after the credit rating of Switzerland’s second-biggest lender was cut three levels by Moody’s.
U.S. futures rose, indicating the S&P 500 Index will pare this week’s 1.3 percent drop. The best time to purchase equities when the Standard & Poor’s 500 Index drops more than 2 percent is noon the next day, according to Birinyi Associates Inc., which studied similar scenarios going back 18 months.
Morgan Stanley jumped 3.9 percent in pre-market trading after Moody’s downgraded the owner of the world’s largest brokerage two levels rather than the three that the rating’s company previously said was possible.
Italy Bonds
The increase in Italy’s 10-year yield widened the spread with equivalent-maturity German yields six basis points to 427 basis points, or 4.27 percentage point.
The yield on the 10-year Treasury rose two basis points to 1.63 percent.
Copper fell as much as 1.7 percent to $7,219.50 a metric ton, the lowest price since Dec. 19. Oil rose 0.7 percent to $78.72 a barrel in New York after falling to $77.56, the lowest since Oct. 5. Zinc and lead also slipped to the lowest prices since October.
The MSCI Emerging Markets Index (MXEF) retreated 1.6 percent, erasing this week’s gains. The Hang Seng China Enterprises Index (HSCEI) of Chinese companies listed in Hong Kong fell 1.7 percent and the BSE India Sensitive (SENSEX) Index slid 1.2 percent. Russia’s Micex Index sank 0.9 percent and the ruble slipped 0.9 percent.
To contact the reporters on this story: Stephen Kirkland in London at skirkland@bloomberg.net; Jason Clenfield in Tokyo at jclenfield@bloomberg.net
To contact the editor responsible for this story: Stuart Wallace at Swallace6@bloomberg.net
