March 5 (Bloomberg) -- Stocks fell for a second day after China announced the lowest economic growth target since 2004 and European services and manufacturing output was less than earlier estimated. The yen strengthened and commodities dropped. The MSCI All-Country World Index dropped 0.3 percent at 8:35 a.m. in New York. Standard & Poor's 500 Index futures slipped 0.2 percent, after losing as much as 0.6 percent. The yen strengthened against all 16 of its most-traded peers, while China's yuan touched a four-week low. The cost of insuring against default on European government debt climbed to the highest in six weeks. Copper slid 0.9 percent and natural gas fell 4 percent. China cut the nation's economic growth target to 7.5 percent from an 8 percent goal in place since 2005, according to Premier Wen Jiabao's speech at the National People's Congress today. European services and manufacturing output shrank in February more than earlier estimated, Markit Economics said, before a report that may show U.S. factory orders fell for the first time in three months. Greece's private creditors decide this week whether to sign off on the country's debt restructuring. "It's a much more challenging market to be bullish in," said Andrew Pease, the Sydney-based chief investment strategist for the Asia-Pacific region at Russell Investment Group, which manages about $150 billion. "While the risk of financial Armageddon in Europe is gone, Europe is still going to have a large recession." Salzgitter Slides The Stoxx Europe 600 Index sank 0.3 percent. Salzgitter AG dropped 5.5 percent, the most since November, as the German steelmaker said it's "impossible" to give detailed earnings forecasts. BP Plc rose 1.4 percent after Europe's second-biggest oil company reached a $7.8 billion settlement with businesses and individuals over the 2010 Deepwater Horizon oil rig disaster. The retreat in S&P 500 futures indicated the U.S. gauge will fall for a second day. A report at 10 a.m. New York time may show orders to U.S. factories fell 1.5 percent in January, according to a Bloomberg survey of economists. The Markit iTraxx SovX Western Europe Index of credit- default swaps on 15 governments rose three basis points to 348, the highest since Jan. 18. The yen climbed 0.3 percent against the euro and advanced 0.5 percent versus the dollar. The euro strengthened 0.1 percent to $1.3217. The S&P GSCI gauge of 24 commodities dropped 0.1, led by declines in natural gas, lead and zinc. Cotton jumped the daily maximum allowed of 4 cents a pound, or 4.5 percent, after India halted exports. India is the second-biggest exporter after the U.S. Emerging Markets The MSCI Emerging Markets Index fell 1 percent after closing at a seven-month high last week. The yuan declined 0.1 percent to 6.3067 per dollar and earlier touched 6.3076, the weakest level since Feb. 7, according to the China Foreign Exchange Trade System. The Hang Seng China Enterprises Index slid 2.3 percent. The Taiex index retreated 1.4 percent after Taiwanese technology companies reported slumping sales. The BSE India Sensitive Index fell 1.6 percent before the results of state elections tomorrow that may be crucial in determining the future of the ruling Congress Party's economic agenda. The Micex Index gained 1.1 percent after Vladimir Putin won a presidential election. --With assistance from Claudia Carpenter, Andrew Rummer, Michael Shanahan, Daniel Tilles and Jason Webb in London. Editors: Stephen Kirkland, Stuart Wallace To contact the reporters on this story: Stephen Kirkland in London at skirkland@bloomberg.net; Lynn Thomasson in Hong Kong at lthomasson@bloomberg.net To contact the editor responsible for this story: Stuart Wallace at swallace6@bloomberg.net

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