July 8 (Bloomberg) -- Stocks fell, pushing the MSCI World Index lower for a fifth day, oil retreated and the yen gained on speculation Group of Eight officials meeting in Italy have little scope to combat the worst recession since World War II. The MSCI World Index of 23 developed countries slipped 0.6 percent at 12:20 p.m. in London, the longest stretch of declines since March. Oil slumped for a sixth day in New York, the worst losing streak since December, while the yen rose to a six-week high against the euro and the dollar. Russia’s ruble fell 0.5 percent versus the dollar to the lowest level in seven weeks. Leaders from the G-8 most-industrialized nations are meeting in L’Aquila, Italy today to tackle shrinking economies and rising unemployment even after the U.S. pledged $12.8 trillion to end the recession. Alcoa Inc.’s results today kick off a U.S. earnings season that will extend the stretch of profit declines for Standard & Poor’s 500 Index companies to a record eight quarters, according to analysts’ estimates compiled by Bloomberg. Japan’s machinery orders unexpectedly fell, a government report showed today. “People had been overly optimistic that the recovery will be fast and V-shaped,” said Nigel Rendell, a senior emerging- market strategist at RBC Capital Markets in London. “We’re not convinced that will be the case. A lot of the value has disappeared out of these markets.” European Stocks Fall The Dow Jones Stoxx 600 Index of European shares slid for a fifth day, losing 0.3 percent. France’s CAC 40 slipped 0.4 percent, extending its retreat since June 1 to 10 percent, the common definition of a “correction.” The MSCI Asia Pacific Index slumped for a sixth straight day, losing 1.3 percent. Holcim Ltd. slipped 3.9 percent in Zurich as the world’s second-biggest cement maker said it expects a “difficult” 2009. Amada Co. fell 4.1 percent in Tokyo as Japanese machinery orders unexpectedly dropped 3 percent in May. Futures on the S&P 500 fluctuated between gains and losses, adding as much as 0.4 percent and dropping 0.3 percent. The benchmark index for U.S. equities tumbled 2 percent yesterday to the lowest level since May 1. Alcoa, the first Dow Jones Industrial Average company to announce second-quarter earnings, added 1.3 percent to $9.53 in pre-market New York trading after sliding 8.9 percent this month. The largest U.S. aluminum producer may report its third consecutive quarterly loss as lower sales to automakers and the construction industry keep the metal at about half of last year’s prices. Aluminum, Oil Aluminum for three-month delivery on the London Metal Exchange slid 1.2 percent today, trimming this year’s gain to 3.8 percent. Nickel slipped 0.5 percent to $15,574 a metric ton for a fifth straight drop. Crude oil for August delivery fell 0.6 percent to $62.54 a barrel on the New York Mercantile Exchange. A government report today is expected to show U.S. gasoline inventories grew last week as the world’s largest energy consumer struggles with the economic slump. The ruble depreciated to 31.6943 per dollar. Russia’s Micex index dropped 1.6 percent as oil producers OAO Rosneft and OAO Lukoil retreated. Qatar’s DSM 20 Index sank 3.6 percent and the Dubai Financial Market General Index fell 3.4 percent. India’s Bombay Stock Exchange Sensitive Index lost 2.8 percent, entering a correction. Emerging Markets The MSCI Emerging Markets Index, a 22-country benchmark, dropped 1.4 percent to the lowest level in two weeks. Developing-nations’ bonds sank, sending the extra yield investors demand to own the debt over U.S. Treasuries 7 basis points higher to 4.41 percentage points, according to JPMorgan Chase & Co.’s EMBI+ Index. Treasury bonds rose, with the yield on the benchmark 10- year note falling as much as 3 basis points to 3.43 percent, the lowest level since May 26. The yield difference, or spread, between the two- and the 10-year securities stayed at 249 basis points, the narrowest in more than a week. The yen climbed against all 16 of the most-traded currencies for a second day, strengthening as much as 1.3 percent versus the euro. The dollar slid as much as 0.9 percent against the yen on speculation the G-8 leaders may question the greenback’s status as the world’s reserve currency. Medvedev, Dollar Russia and India said in the past week the world economy is too dependent on the dollar and called for revisions to how $6.5 trillion in currency reserves are managed. “The dollar system or the system based on the dollar and euro have shown that they are flawed,” Russian President Dmitry Medvedev said in an interview with the Italian newspaper Corriere della Sera, repeating his proposal for a new reserve currency. Staunching the recession, combating climate change, promoting trade and dealing with Iran top the agenda of the G-8, a grouping of 880 million people with combined GDP of $32 trillion that includes the U.S., Japan, Germany, Britain, France, Italy, Canada and Russia. Divisions persist over stimulus measures -- Germany says now is the time to begin curbing deficits -- and the scope of financial oversight. The U.S., Europe and Japan are grappling with their first simultaneous recessions since World War II after the collapse of subprime mortgages froze credit markets and spurred almost $1.5 trillion in losses and writedowns at financial firms. The World Bank said last month that the global economy will shrink 2.9 percent this year, a deeper slump than the 1.7 percent contraction forecast in March. A credit-market gauge favored by former Federal Reserve Chairman Alan Greenspan showed the freeze that has gripped banks for the past two years may be all but over by mid-2011. The Libor-OIS June 2011 forward rate agreement fell to 25 basis points today, a level Greenspan said a year ago he considered “normal.”

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