By Stephen Kirkland and Lynn Thomasson - Feb 22, 2012 5:09 PM GMT+0700
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A man reacts as he looks at an electronic stock board outside a securities firm in Tokyo, Japan. Photographer: Kiyoshi Ota/Bloomberg
Feb. 22 (Bloomberg) -- Mikio Kumada, a global strategist at LGT Capital Management in Singapore, talks about Asia's economies and financial markets. Kumada also discusses Europe's sovereign debt crisis. He speaks with Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)
European stocks fell for a second day and commodities declined after the region’s services and manufacturing output unexpectedly shrank. German bonds gained, while the dollar strengthened against the yen.
The Stoxx Europe 600 Index lost 0.6 percent at 10:05 a.m. in London. Futures on the Standard & Poor’s 500 Index slipped less than 0.1 percent. Copper retreated 0.4 percent. The German 10-year bund yield decreased three basis points to 1.95 percent, snapping a four-day climb. The dollar appreciated 0.5 percent to 80.17 yen.
A gauge of euro-area services and manufacturing output dropped to 49.7, London-based Markit Economics said, below the 50.5 forecast by economists in a Bloomberg survey. China’s manufacturing may shrink for a fourth month, according to data from HSBC Holdings Plc and Markit. U.S. sales of previously owned homes probably rose last month to the highest level since May 2010, economists said before a National Association of Realtors report today.
The Stoxx 600 extended its decline from a six-month high. Straumann Holding AG (STMN), the biggest maker of dental implants, sank 10 percent in Zurich after 2011 profit missed analyst estimates. PSA Peugeot Citroen rallied 9.8 percent as French Labor Minister Xavier Bertrand said the automaker is in talks with General Motors Co. about a possible alliance.
S&P 500 futures expiring next month erased an earlier gain of as much as 0.3 percent. A report at 10 a.m. New York time may show sales of existing U.S. homes climbed 1.1 percent in January, a fourth straight month of gains, according to the median forecast of 74 economists surveyed by Bloomberg News.
Debt Sale
The German five-year yield fell three basis points. The government sells as much as 5 billion euros of two-year notes today. Portugal’s two-year note yield jumped 69 basis points, while the extra yield investors demand to hold Italian 10-year bonds instead of bunds, Europe’s benchmark government securities, climbed 8 basis points to 354 basis points.
The Dollar Index rose 0.2 percent, while the yen weakened versus all 16 most-traded peers monitored by Bloomberg, falling 0.5 percent against the euro.
Copper dropped for the first time in three days. Oil in New York declined 0.4 percent to $105.82 a barrel, the first drop in a week.
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: Mark Gilbert at magilbert@bloomberg.net
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