European, U.S. Stock-Index Futures Drop; Asian Shares Decline

By Adam Haigh

Aug. 19 (Bloomberg) -- European and U.S. stock-index futures fell and Asian shares retreated as China’s Maanshan Iron & Steel Co. posted a second straight half-year loss and copper dropped. The Shanghai Composite Index entered a bear market.

Maanshan fell 7.7 percent after announcing a 795.4 million yuan ($116 million) net loss for the first half. BHP Billiton Ltd. slid 1.5 percent in Australia as lead, tin and nickel slipped on the London Metal Exchange. Telekom Austria AG will probably move as profit at the country’s biggest phone company trailed analysts’ estimates for the second quarter.

Futures on the Euro Stoxx 50 Index slid 0.7 percent at 7:52 a.m. in London. The U.K.’s FTSE 100 Index is set to open 24 points lower, according to inter-dealer broker BGC Partners. Standard & Poor’s 500 Index futures expiring in September slipped 1 percent, while the MSCI Asia Pacific Index decreased 0.7 percent.

China’s Shanghai Composite Index fell as much as 5.1 percent, a 20.5 percent retreat from this year’s high on Aug. 4. Maanshan dropped 7.7 percent to 4.80 yuan. A slump of at least 20 percent on an index is commonly defined as a bear market.

Europe’s Stoxx 600 has rallied 44 percent since March 9 as companies from GlaxoSmithKline Plc to Intel Corp. reported better-than-estimated results and Germany and France unexpectedly returned to economic growth. The increase left the measure valued at 40.2 times the profits of its companies, near the most expensive level since 2003, weekly data compiled by Bloomberg show.

Worst Drop

U.S. and European stocks rose yesterday, helping global equities rebound from the worst drop since April, following better-than-estimated earnings at Home Depot Inc. and Target Corp. and an increase in German investor confidence.

BHP slid 1.5 percent to A$36.71. Copper retreated 2.3 percent on the LME.

Telekom Austria may move. Net income dropped to 82.3 million euros ($116.5 million), missing the 84.1 million euros estimated by analysts surveyed by Bloomberg.

SBM Offshore NV, the world’s largest supplier of floating oil production platforms, will probably be active as it reported first-half profit of $95.5 million.

Earnings in Europe slumped 38 percent in the second quarter, while less than half of profits have topped analysts’ projections, according to data compiled by Bloomberg.

Dexia SA may move after Deutsche Bank AG downgraded shares of the world’s largest lender to local governments to “hold” from “buy.”

To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net