European, Asian Shares Drop; Alcatel, Seven & I, Sekisui Fall

By Adria Cimino

Sept. 2 (Bloomberg) -- European stocks fell for a third straight day on speculation a six-month rally has outpaced the prospects for earnings growth after valuations for the Dow Jones Stoxx 600 Index climbed to the most expensive level in six years. Asian shares declined.

Alcatel-Lucent SA slumped 3.9 percent after the world’s largest supplier of fixed-line phone networks said it plans to sell as much as 862.5 million euros ($1.23 billion) of convertible bonds. Seven & I Holdings Co., the biggest convenience-store operator, and Sekisui House Ltd., Japan’s largest homebuilder, dropped more than 2 percent in Tokyo after cutting their profit forecasts.

Europe’s Stoxx 600 fell 0.8 percent at 8:11 a.m. in London, extending this week’s slump to 3.2 percent. The regional gauge is valued at 48.6 times profit, the highest level since June 2003, according to weekly data compiled by Bloomberg.

“Everyone seems to have talked themselves into the fact that there’s going to be a pullback in September and October, and it’s beginning to happen,” Ben Potter, a research analyst at IG Markets in Melbourne, wrote in a note.

The MSCI Asia Pacific Index lost 1.5 percent. Futures on the Standard & Poor’s 500 Index were little changed after the benchmark gauge for U.S. equities slid for a third straight day yesterday, the longest streak since June. Financial shares led the drop as concern banks will post more losses overshadowed manufacturing and housing data that topped estimates.

Alcatel, Maersk

Alcatel-Lucent slid 3.9 percent to 2.45 euros. The company will sell 750 million euros of convertible bonds to refinance debt. The sale can be increased to 862.5 million euros.

A.P. Moeller-Maersk A/S fell 5.4 percent to 34,900 kroner. The owner of the world’s largest container shipping line will raise up to 9.2 billion kroner ($1.76 billion) by selling treasury shares.

Seven & I declined 2.7 percent to 2,170 yen after cutting its full-year net income target by 11 percent. Aeon Co., Japan’s second-largest retailer, slumped 4.5 percent to 929 yen. Uny Co., which runs department stores, slid 5.1 percent to 752 yen.

Sekisui House dropped 4.9 percent to 848 yen. The Osaka- based company cut its profit forecast for the year ending Jan. 31 by 68 percent to 6 billion yen ($65 million), citing the slump in the housing market.

A report today may show orders placed with U.S. factories rose in July by the most in two years as companies tried to prevent stockpiles from dropping further.

Bookings increased 2.2 percent, the most since July 2007, according to the median projection of 63 economists surveyed by Bloomberg News. Other data may show worker productivity climbed and job losses slowed.

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