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 gained and global bonds erased losses for the month.
The Stoxx Europe 600 Index declined 0.5 percent at 7:15 a.m. in New York. Standard & Poor’s 500 Index futures slipped less than 0.1 percent after advancing as much 0.3 percent. The euro appreciated 0.3 percent to $1.2541. Spain’s two-year notes rose 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 lost 0.4 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 but one of the 19 industry groups in the Stoxx 600 retreated. G4S Plc dropped 2.5 percent after the security company said that first-half profit slumped 73 percent. Vestas Wind Systems A/S, the world’s largest wind-turbine maker, jumped 17 percent after saying it’s in talks with Mitsubishi Heavy Industries Ltd. on possible “strategic cooperation.”
Consumer Confidence
U.S. index futures rose after the S&P 500 slipped less than 0.1 percent yesterday. The Conference Board’s index of consumer confidence 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. Germany's 10-year bond yield was little changed at 1.35 percent.
Spanish Auction
The yield on Spain’s two-year note fell nine basis points to 3.66 percent as the government sold 3.6 billion euros ($4.5 billion) of bills, surpassing the 3.5 billion-euro maximum target.
The yen strengthened 0.1 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.
Oil rose 0.5 percent to $95.90 a barrel, gaining for the first time in four days in New York as U.S. crude inventories were forecast to drop, a storm headed for Louisiana and a fire continued to burn at Venezuela’s biggest refinery.
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 0.2 percent and Taiwan’s Taiex index slid 1.4 percent. Russia’s Micex Index rose 0.3 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
