Europe, Asia Stocks Fall; Barclays, Royal Bank, Intel Decline

By Adria Cimino

Nov. 13 (Bloomberg) -- Stocks fell in Europe and Asia as Germany sank into recession, the OECD forecast a global slump and Intel Corp. cut its sales target. U.S. index futures were little changed.

Russia's Micex Index tumbled as much as 17 percent, and Kuwait suspended stock trading. Barclays Plc and Royal Bank of Scotland Group Plc led banks lower, sliding more than 4 percent, after the Organization for Economic Cooperation and Development reduced its outlook for global growth and predicted an ``extended period of financial headwinds.'' Intel sank 5.7 percent in Germany.

Europe's Dow Jones Stoxx 600 Index lost 1.1 percent to 202.90 at 1:20 p.m. in London, pushing this year's retreat to 44 percent. The OECD forecast comes after a report showed Germany entered its worst recession in at least 12 years.

``We'll see equities go lower,'' said Andrew Lynch, who manages about $3 billion at Schroder Investment Management Ltd. in London. ``People will have to revise down further their outlook for corporate earnings'' to reflect the slowdown.

Futures on the Standard & Poor's 500 Index added less than 0.1 percent, gyrating between gains and losses as speculation the Federal Reserve may cut interest rates to boost economic growth offset lower forecasts from Intel and Wal-Mart Stores Inc. The MSCI Asia Pacific Index sank 4.7 percent.

Earnings for the 1,493 companies in western Europe that reported results since Oct. 7 declined 17 percent on average, trailing expectations by 7.3 percent, Bloomberg data show.

National benchmarks fell in 11 of the 18 western European markets. The U.K.'s FTSE 100 lost 1.2 percent. Germany's DAX gained 0.1 percent, and France's CAC 40 increased 0.3 percent.

Trading Halted

Russia's Micex Index fell as much as 17 percent and was 7.5 percent lower at 3:05 p.m. in Moscow after it reopened following a 30-minute trading suspension. A court in Kuwait ordered a shutdown as traders lobbied for support after a sixth day of declines. The MSCI Emerging Markets Index slid 4.7 percent.

More than $30 trillion has been erased from the value of global equity markets this year as credit losses and writedowns totaled $950 billion in the worst financial crisis since the Great Depression.

Barclays sank 4.9 percent to 160 pence, and Royal Bank of Scotland lost 6.1 percent to 52.6 pence.

Gross domestic product in the countries sharing the euro currency will contract 0.5 percent next year and U.S. GDP growth will retreat 0.9 percent, according to the OECD. GDP in Japan will contract 0.1 percent in 2009, the Paris-based group said.

``Underlying the projections is an assumption that the extreme financial stress since mid-September is short-lived, but will be followed by an extended period of financial headwinds through late 2009,'' the group said.

Germany Recession

GDP in Germany, Europe's largest economy, dropped a seasonally adjusted 0.5 percent from the second quarter, when it fell a revised 0.4 percent, a report showed today. Economists expected a 0.2 percent decline in a Bloomberg survey.

Zurich Financial Services AG slid 3.6 percent to 208.1 francs. Switzerland's biggest insurer halted a share buyback program after third-quarter profit fell 90 percent on debt writedowns and losses from hurricanes in the U.S.

Intel sank 5.7 percent to $12.75. The world's largest semiconductor maker cut its fourth-quarter revenue estimate by about $1 billion. The company cited ``significantly weaker'' demand across its entire product line.

STMicroelectronics NV, Europe's largest maker of semiconductors, lost 4.3 percent to 5.89 euros. Infineon Technologies AG, the region's second-biggest, retreated 1.1 percent to 2.28 euros.

LG Display Co. tumbled 11 percent to 20,100 won in South Korea, while Sharp Corp. fell 8.4 percent to 667 yen in Japan.

BT Group

BT Group Plc surged 9.1 percent to 122.7 pence. The company aims to cut about 6 percent of its workforce in the year through March to improve profitability after reporting a slide in second-quarter earnings.

Reed Elsevier Plc said it's ``on track'' for good sales growth, margin improvement and growth in adjusted earnings per share. The stock rose 7.1 percent to 523.5 pence.

Hochtief AG, Germany's biggest construction company, jumped 7.7 percent to 27.24 euros. Deutsche Bank AG raised its recommendation on the shares to ``buy'' from ``hold.''

Bayerische Motoren Werke AG, the world's largest maker of luxury cars, climbed 4.5 percent to 21.59 euros. BMW Finance NV, a unit of BMW, plans to sell five-year bonds in euros, according to a banker involved in the transaction.

To contact the reporter on this story: Adria Cimino in Paris at acimino1@bloomberg.net.