Stocks fell and metals declined as a split emerged among European leaders on a rescue plan and the Federal Reserve said companies grew more pessimistic about the U.S. economy. Standard & Poor’s 500 Index futures rose, while Spanish bond retreated. The MSCI All-Country World Index slipped 0.6 percent at 10:40 a.m. in London. The Stoxx Europe 600 Index retreated 0.6 percent, after declining 1.5 percent. Standard & Poor’s 500 Index futures advanced 0.6 percent. The euro strengthened 0.3 percent, reversing earlier losses. The Spanish two-year note yield jumped six basis points, while the extra yield investors demand to hold French 10-year bonds instead of benchmark German bunds rose to a euro-era record. Copper, zinc and tin slid more than 2 percent. Luxembourg Prime Minister Jean-Claude Juncker, who chairs the group of euro-area finance ministers, indicated an impromptu meeting of European leaders in Frankfurt yesterday failed to resolve differences ahead of a summit scheduled for this weekend. The Fed’s Beige Book survey released yesterday showed companies reported more doubt about the recovery even as the economy maintained its expansion last month. “Time is running out,” Gary Jenkins, head of fixed income at Evolution Securities in London, said in a report. “I hate to think what the market will be like next week if there is a complete lack of clarity or agreement from the European Union this weekend.” Stocks pared losses and the euro rebounded after European Commission President Jose Barroso expressed optimism that euro- area leaders will reach agreement this weekend. Trimming Forecast Two shares declined for every one that gained on the Stoxx 600. Schneider Electric SA (SU), the world’s biggest maker of low-and medium-voltage equipment, plunged 7.1 percent after trimming its 2011 profit target for the second time in four months. Actelion Ltd. (ATLN) sank 13 percent as Europe’s largest biotechnology company said it expects drug sales to decrease next year. The gain in S&P 500 futures indicated the U.S. gauge may pare yesterday’s drop. EBay Inc. fell 3.4 percent in German trading after the largest online marketplace forecast sales and profit that missed some analysts’ estimates. Seventy percent of the 66 companies in the index that have reported earnings since Oct. 11 have beaten analysts’ profit estimates, Bloomberg data show. Microsoft Corp., the world’s largest software maker, and AT&T Inc. are among 32 members of the S&P 500 due to release results today. The Beige Book said many Fed districts described the pace of growth as “modest” or “slight” in September, even though overall economic activity continued to expand. Data today may show initial jobless claims eased to 400,000 in the week ended Oct. 15 from 404,000 previously, while a gauge of leading indicators grew at a slower pace. Debt Sales The yield on the Spanish 10-year bond rose seven basis points as Spain sold 3.91 billion euros ($5.37 billion) of 10- year bonds and notes maturing in 2017 and 2019, compared with the Treasury’s maximum target for the sale of 4.25 billion euros, data from the Bank of Spain showed. The French two-year yield rose three basis points as the government auctions nominal debt maturing in 2013, 2014, 2015 and 2016. It also sells inflation-protected securities due in 2016, 2022 and 2027. The yield on the German 10-year bund declined two basis points, while the yield on the Greek 6.25 percent bond maturing in June 2020 advanced 10 basis points. New Zealand’s dollar rose against all 16 major peers, advancing 0.3 percent versus the U.S. currency and 0.3 percent against the yen. Copper fell 3.3 percent, after sinking 4.4 percent in the previous three days. Zinc declined 3.1 percent and tin slipped 3.3 percent. Oil rose 0.1 percent to $86.18 a barrel. Emerging Markets The MSCI Emerging Markets Index retreated 2.1 percent, the biggest decline on a closing basis in more than two weeks. The Shanghai Composite Index slumped 1.9 percent to a 31-month low on concern China may persist with policies to rein in lending. Risks stemming from private lending must be “strictly controlled,” China’s banking regulator said. China Southern Airlines Co. led losses for carriers after China Business News said the aviation regulator reduced its estimates for passenger volume growth. The BSE India Sensitive Index fell 1.4 percent and South Korea’s Kospi Index (KOSPI) declined 2.7 percent. Russia’s Micex Index retreated 1.3 percent and benchmark indexes fell at least 1 percent in Poland, Turkey and South Africa. To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net; Shiyin Chen in Singapore at schen37@bloomberg.net To contact the editor responsible for this story: Stuart Wallace at swallace6@bloomberg.net

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