By Stephen Kirkland and Lynn Thomasson - Mar 6, 2012 9:31 PM GMT+0700
Global stocks fell for a third day, the longest stretch in two months, and commodities slid while the yen strengthened as concern mounted the global economy is slowing. Spanish bonds declined and U.S. Treasuries gained.
The MSCI All-Country World Index (MXWD) lost 1.4 percent at 8:20 a.m. in New York and the Standard & Poor’s 500 Index slipped 0.7 percent. The yen appreciated against all 16 of its most-traded peers, climbing 0.6 percent versus the dollar. The yield on the Spanish 10-year bond rose 10 basis points, with the similar- maturity U.S. Treasury note yield falling six basis points. Copper declined 2.8 percent and oil slid 1.7 percent.
March 5 (Bloomberg) -- Ayman Asfari, chief executive officer of Petrofac Ltd., discusses the company's full-year profit, business outlook and global oil supplies. He speaks with Mark Barton on Bloomberg Television's "On the Move." (Source: Bloomberg)
March 6 (Bloomberg) -- Brian Rogers, chairman and chief investment officer of T. Rowe Price Group Inc., talks about the outlook for the stock market, investor sentiment and investment strategy. Rogers speaks with Sara Eisen and Erik Schatzker on Bloomberg Television's "InsideTrack." (Source: Bloomberg)
March 6 (Bloomberg) -- Michael Purves, chief market strategist at BGC Financial LP, talks about U.S. stocks. Purves speaks with Erik Schatzker and Stephanie Ruhle on Bloomberg Television's "InsideTrack." (Source: Bloomberg)
March 6 (Bloomberg) -- David Joy, the Boston-based chief market strategist at Ameriprise Financial Inc., talks about U.S. and emerging-market stocks. He speaks with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
March 6 (Bloomberg) -- Arnout Van Rijn, chief investment officer for Robeco Groep NV’s Hong Kong division, talks about Asia stocks and his investment strategy. He speaks with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
Europe’s economy shrank 0.3 percent last quarter, the European Union’s statistics office confirmed, and the central bank’s balance sheet surged to a record 3.02 trillion euros ($3.96 trillion) last week amid crisis-fighting efforts. Private investors that so far declared participation in Greece’s debt restructuring hold about 20 percent of the bonds involved in a swap deal that ends March 8.
“Recessionary forces are still in the ascendance,” Tim Price, chief investment director at PFP Group in London, said in a phone interview. “Greece is going to default. The way politicians and technocrats have the technical default dressed up as something less than a default is pure semantics.”
The S&P 500 slipped for a third day after last week closing at its highest level since 2008. The index has rallied 24 percent from last year’s low in October and started today’s session up 8.5 percent for the year.
The Stoxx 600 Europe Index (SXXP) slid 1.9 percent, its biggest loss of the year and extending yesterday’s 0.6 percent decline as automakers and producers of industrial goods retreated. PSA Peugeot Citroen dropped 3.9 percent as Europe’s second-biggest carmaker announced plans to sell 1 billion euros of shares. Cable & Wireless Worldwide Plc slid 5.1 percent as the Telegraph in London said Vodafone Group Plc may not make a takeover offer.
Spread Widens
The yield on the 10-year German bund fell four basis points to 1.79 percent, leaving the difference in yield between Europe’s benchmark government securities and Spanish debt 12 basis points wider, increasing for the third straight day. Italy’s 10-year yield rose seven basis points. The yield on the Portuguese two-year note jumped nine basis points.
Greece sold 1.137 billion euros of 26-week Treasury bills today with a uniform yield of 4.8 percent with investors bidding for 2.63 times the securities offered, the debt management agency said. The European Financial Stability Facility sold 3.44 billion euros of three-month debt at an average yield of 0.0516 percent.
The cost of insuring European sovereign bonds rose for a third day, with the Markit iTraxx SovX Western Europe Index of credit-default swaps on 15 governments climbing 5.4 basis points to 351.65.
Yen Strengthens
The yen climbed 1.5 percent against the euro and advanced 0.8 percent versus the dollar. The euro depreciated 0.8 percent to $1.3118. Australia’s dollar dropped 1.1 percent versus the greenback after the nation’s central bank kept interest rates unchanged and said it has scope to ease policy if needed. The New Zealand dollar weakened against all but three of its 16 major counterparts after a report showed the country’s budget deficit widened more than the government had estimated.
The MSCI Emerging Markets Index (MXEF) fell 2 percent, taking its two-day drop to 2.8 percent. Russia’s Micex Index (MICEX) slid 3.2 percent, the most this year, after more than 200 people were detained in protests against Vladimir Putin’s presidential election victory yesterday.
The Hang Seng China Enterprises Index (HSCEI) of mainland companies listed in Hong Kong sank 3.1 percent, the most in almost three months. The BSE India Sensitive Index (SENSEX) slipped 1.1 percent and the FTSE/JSE Africa All Share Index fell 1.9 percent in Johannesburg as industrial metals prices declined.
The S&P GSCI index of 24 commodities slipped 1.2 percent as zinc and lead sank more than 3 percent.
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: Nick Baker at nbaker7@bloomberg.net
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