By Sarah Jones - Aug 13, 2012 11:08 AM GMT+0400
European stocks declined, after a 10th week of gains for the Stoxx Europe 600 Index, as slowing growth in Japan added to signs of a deepening global economic slump. U.S. index futures and Asian shares also fell.
Solarworld AG (SWV) tumbled 10 percent after the company forecast lower revenue growth.Julius Baer Group Ltd. fell 1.2 percent after agreeing to buy Bank of America Corp’s Merrill Lynch wealth management business outside the U.S. Standard Chartered Plc rose 1.3 percent amid a report the bank has discussed a settlement with New York regulators over money laundering allegations.
Gross domestic product advanced an annualized 1.4 percent in the three months through June, less than the median economist estimate of 2.3 percent in a Bloomberg News survey and down from 5.5 percent the previous quarter, a Cabinet Office report showed in Tokyo today. Photographer: Tomohiro Ohsumi/Bloomberg
The Stoxx 600 lost 0.2 percent to 269.41 at 8:05 a.m. in London after rising to the highest level since March 19 last week. Standard & Poor’s 500 Index futures fell 0.3 percent, while the benchmark MSCI Asia Pacific Index fell 0.2 percent.
Data today showed a reconstruction-fueled rebound in Japan’s economy waned in the second quarter as consumer spendinggrowth almost stalled and export gains diminished.
Gross domestic product advanced an annualized 1.4 percent in the three months through June, less than the median economist estimate of 2.3 percent in a Bloomberg News survey and down from 5.5 percent the previous quarter, a Cabinet Office report showed in Tokyo today. Unadjusted for prices, GDP contracted at a 0.6 percent annual pace.
The Stoxx 600 (SXXP) fell on Aug. 10 after a collapse in Chinese export growth added to concern the world’s second-largest economy is also slowing. Europe’s benchmark gauge has still climbed for 10 weeks, the longest stretch of gains since January 2006, boosted by speculation policy makers will do more to stimulate growth.
Federal Reserve
Federal Reserve Bank of San Francisco President John Williams said the central bank should ease policy further, according to the San Francisco Chronicle.
Weakening employment, consumer spending and gross domestic product growth suggest the Fed should begin a third round of bond purchases, Williams said in an interview with the newspaper. Williams, a voting member of the Federal Open Market Committee this year, joins other Fed presidents including Eric Rosengren of Boston in calling for more efforts to support the U.S. economy.
Solarworld plummeted 10 percent to 1.19 euros after Germany’s biggest panel-maker said it sees lower full-year revenue in 2012 from a year earlier. The company reported a second-quarter net loss of 161 million euros ($197.7 million) and sales of 169.6 million euros for the period.
Julius Baer
Julius Baer dropped 1.2 percent to 35 Swiss francs after the Swiss money manager agreed to pay about 860 million francs ($880 million) for Bank of America’s Merrill Lynch non-U.S. wealth management business. The company said it plans to raise 750 million francs through a rights offering to help fund the deal.
Standard Chartered (STAN) rose 1.3 percent to 1,343.5 pence. The lender and New York regulators have discussed a settlement amount to resolve the inquiry into whether the bank’s records hid transactions tied to Iran, Reuters reported, citing people familiar with the situation. The amount was not disclosed.
Standard Chartered tumbled 15 percent in London last week after being accused of violating U.S. money laundering laws over its dealings with Iranian banks, raising concern the bank may lose its license to operate in New York.
To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net
To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net
