BLBG:Stocks Decline With Metals On Japan Outlook As Euro Gains
European stocks fell for the first time in three days and metals dropped as Japan pared its assessment of the economy. The euro strengthened, Spain’s two- year notes rose and global bonds erased losses for the month.
The Stoxx Europe 600 Index declined 0.6 percent at 10:15 a.m. in London, while Standard & Poor’s 500 Index futures added 0.1 percent. The euro gained 0.4 percent to $1.2543. Spain’s two-year notes advanced after a debt sale. Fixed-income assets worldwide returned less than 0.1 percent in August, according to a Bank of America Corp. index. Copper retreated 0.3 percent and zinc slid 0.8 percent.
Japan’s government downgraded its assessment of the economy for the first time in 10 months on risks from a further slowdown in the global economy. A gauge of U.S. consumer confidence probably rose August, economists said before data from the Conference Board today. A report tomorrow on U.S. gross domestic product may show faster growth in the world’s largest economy before Federal Reserve Chairman Ben S. Bernanke’s speech on Aug. 31 at an annual meeting in Jackson Hole, Wyoming.
“The world economy in the second quarter was the worst in quite some time, and Japan is catching up now,” said Konstantin Giantiroglou, head of investment advisory at Neue Aargauer Bank in Brugg, Switzerland. “It’s a reaction to what’s going on and it was overdue that they correct the assessment.”
All 19 industry groups in the Stoxx 600 retreated. Vestas Wind Systems A/S, the world’s largest wind-turbine maker, jumped 18 percent after saying it’s in talks with Mitsubishi Heavy Industries Ltd. on possible “strategic cooperation.”
Consumer Confidence
Futures on the S&P 500 rose less than 0.1 percent before a report that may show confidence among U.S. consumers advanced for a second month in August. The Conference Board’s index increased to 66 this month from 65.9 in July, according to the median forecast in a Bloomberg survey of 77 economists.
The S&P/Case-Shiller index of house prices in 20 U.S. cities is projected to be almost unchanged in June from a year earlier, the first time since September 2010 that it hasn’t shown a drop.
Global bonds reversed losses from earlier in August, when they were on course for the worst performance since November 2010, according to the Bank of America Merrill Lynch Global Broad Market Index.
Benchmark U.S. 10-year yields were one basis point away from a two-week low, at 1.64 percent. German 10-year bonds were little changed, yielding 1.36 percent, after advancing on each of the past four days.
Spanish Auction
The yield on Spain’s two-year note fell five basis points as the government sold 3.6 billion euros ($4.5 billion) of bills, surpassing the 3.5 billion-euro maximum target.
The yen strengthened 0.2 percent versus the dollar. Norway’s krone climbed against 15 of its 16 major peers, reaching the strongest level against the dollar since May 8.
The MSCI Emerging Markets Index (MXEF) slipped 0.3 percent, declining for a third day. The Hang Seng China Enterprises Index of mainland companies declined 0.3 percent and Taiwan’s Taiex index slid 1.4 percent. Russia’s Micex Index rose 0.2 percent.
To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net; Glenys Sim in Singapore at gsim4@bloomberg.net
To contact the editor responsible for this story: Stuart Wallace at Swallace6@bloomberg.net
