BLBG: Europe Stocks Fall With S&P 500 Futures as Pound Falls
European stocks fell with U.S. equity-index futures after German business confidence declined to the lowest level this year. Dubai shares fell the most since 2008, Treasuries gained and the pound weakened.
The Stoxx Europe 600 Index slid 0.3 percent at 6:11 a.m. in New York. Standard & Poor’s 500 Index futures also lost 0.3 percent. Dubai benchmark gauge tumbled 7.7 percent after entering a bear market yesterday. Treasury 10-year yields fell three basis points to 2.60 percent. Gold climbed as much as 0.7 percent to $1,325.86 an ounce. The pound depreciated against 14 of its 16 major peers.
German business confidence dropped more than estimated in June amid signs of slower growth in Europe’s largest economy, the Ifo institute reported, before data on U.S. consumer confidence and housing. Sterling fell after Bank of England Governor Mark Carney said wage data had been softer than expected. The ruble extended gains as Russian President Vladimir Putin asked lawmakers to cancel the right to use force in Ukraine.
“The fall in the Ifo is a signal that the eurozone’s growth engine is slowing down,” said Witold Bahrke, who helps oversee $55 billion as a senior strategist at PFA Asset Management in Copenhagen. “German businesses as of now are quite unimpressed by measures taken by the European Central Bank.”
Two shares declined for every one that gained in the Stoxx 600, with all but four of the 19 industry groups dropping.
The Ifo institute’s business climate index, based on a survey of 7,000 executives, declined to 109.7 in June from 110.4 in May. Economists predicted a drop to 110.3, according to the median of 40 estimates in a Bloomberg News survey.
Croda International Plc (CRDA) lost 8.4 percent after the world’s second-largest supplier of cosmetic ingredients lowered its profit outlook. Altice SA fell 5.6 percent as cable billionaire Patrick Drahi’s investment company sold about $1.2 billion of new stock.
Syngenta Jumps
Syngenta AG jumped 6 percent after people familiar with the matter said Monsanto Co. recently explored a takeover of the Swiss crop-chemicals maker.
S&P 500 futures expiring in September were little changed today. The index slipped less than 0.1 percent yesterday, remaining near the all-time high reached last week.
Data at 10 a.m. New York time may show the Conference Board’s consumer confidence index increased to 83.5 this month from 83, according to another survey.
Separate reports may show that new-home sales in the U.S. increased in May, while the S&P/Case-Shiller index of property prices in 20 U.S. cities climbed 11.5 percent in April, projections show.
Dubai Tumbles
Dubai stocks tumbled as turmoil at the United Arab Emirates’ largest-listed builder, Arabtec Holding Co., prompted the biggest selloff in almost six years. Arabtec dropped 9.8 percent to the lowest since February after the company confirmed it cut staff.
The ruble strengthened 0.6 percent against the dollar and the Micex Index of stocks jumped 1.1 percent.
Putin asked the upper house of parliament to cancel approval granted March 1 to use force in Ukraine, Kremlin spokesman Dmitry Peskov said by phone, confirming an Interfax report. Pro-Russian forces in Ukraine called a cease-fire in fighting against government forces, matching a truce announcement made earlier by President Petro Poroshenko.
The yield on Ukraine’s 2023 Eurobond fell five basis points to 9.07 percent.
Treasuries gained before the release of reports this week that analysts said will show new-home sales slowed and gross domestic product contracted more than earlier estimated.
Two-year yields were little changed, with the yield at 0.46 percent. The Treasury plans to sell $30 billion of 2016 notes today and those securities yielded 0.51 percent in when-issued trading, which would be the highest for a sale of two-year debt since May 2011.
Portugal’s 10-year yield fell five basis points to 3.46 percent and Spain’s dropped four basis points to 2.65 percent.
To contact the reporters on this story: Nick Gentle in Hong Kong at ngentle2@bloomberg.net; Stephen Kirkland in London at skirkland@bloomberg.net
To contact the editors responsible for this story: Stuart Wallace at swallace6@bloomberg.net Stephen Kirkland
