Bloomberg News

European Stocks Are Little Changed Before Italy, Spain Sell Debt

January 12, 2012

Jan. 12 (Bloomberg) -- European stocks were little changed as Italy and Spain prepared for their first debt auctions this year and after the Federal Reserve said America’s economy improved last month. U.S. index futures and Asian shares fell.

Royal Bank of Scotland Group Plc rose 1.7 percent after saying it will eliminate jobs. Sulzer AG, the world’s second- largest maker of pumps, added 2.1 percent after saying full-year orders rose 14 percent. Vestas Wind Systems A/S lost 5 percent after announcing job cuts. Delhaize Group SA, the owner of Food Lion supermarkets, tumbled 6.6 percent after saying it will eliminate about 5,000 positions and its revenue may drop.

The Stoxx Europe 600 Index dropped less than 0.1 percent to 249.77 at 8:04 a.m. in London. The March contract on the Standard & Poor’s 500 Index slipped 0.2 percent, while the MSCI Asia Pacific Index retreated 0.3 percent.

The U.S. economic expansion improved last month across most of the country, while hiring was limited and housing remained stagnant, the Federal Reserve said in the first edition of its Beige Book in 2012.

“The U.S. Beige Book from the Fed confirmed recent data,” Jonathan Sudaria, a trader at London Capital Group, wrote. “However, gains are to be limited ahead of a busy day for economic data which could see traders diving from headline to headline or stuck on the sidelines in analysis paralysis.”

Spain and Italy will sell as much as 17 billion euros ($21.5 billion) in debt today. Germany received more than double the maximum bid target in a sale of notes yesterday.

Economic Reports

The Stoxx 600 has advanced 2.2 percent since the beginning of this year as economic reports around the world added to optimism the global economy can withstand the euro area’s debt crisis.

Sales at U.S. retailers probably rose in December as Americans bought discounted holiday items, giving the economy a boost entering 2012, economists said before a report today. Initial jobless claims rose to 375,000 last week from 372,000 the previous period, data from the Labor Department may show.

The Bank of England will keep its benchmark interest rate at a record low today, according to all 53 economists in a Bloomberg survey. The bank may refrain from adding to emergency stimulus again as policy makers await new forecasts and the economy showed some resilience, the survey showed. It will announce the decisions at noon in London.

The European Central Bank will leave its key rate at 1 percent today, a separate survey shows, and ECB President Mario Draghi will speak at 2:30 p.m. in Frankfurt.

--Editor: Srinivasan Sivabalan

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

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net


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