European stocks fell with government bonds and emerging-market currencies weakened as a gauge of Chinese manufacturing missed estimates and the Federal Reserve signaled stimulus may be reduced. The yen weakened to a four-month low against the dollar.
The Stoxx Europe 600 Index decreased 0.4 percent at 10 a.m. in London. Standard & Poor’s 500 Index (SPA) futures added 0.1 percent, signaling the gauge will snap a three-day slump. Chinese shares in Hong Kong dropped from an eight-month high and Indonesia’s rupiah sank to the weakest level since March 2009 against the dollar. Germany’s 10-year yield jumped five basis points to 1.76 percent. The yen depreciated to 100.88 per dollar, the weakest since July 10.
A private index of manufacturing in China, the world’s second-largest economy, decreased for the first time in four months, according to a report today. The Bank of Japan left policy unchanged after minutes of the Fed’s last meeting signaled yesterday that the central bank may taper asset purchases “in coming months” if the economy improves as anticipated.
“Concerns about Fed tapering are dragging on the market because of worries about the lack of liquidity if it did happen,” said Tang Yonggang, an analyst at Hongyuan Securities Co. in Beijing. “The flash PMI doesn’t help sentiment.”
Two shares declined for every one that advanced in the Stoxx 600, with trading volumes 15 percent less than the 30-day average, according to data compiled by Bloomberg.
Atos (ATO) declined 3.6 percent after an investor sold 8.9 million shares. Intermediate Capital Group Plc lost 3.3 percent after Numis Securities Ltd. cut its rating on the money manager. European Aeronautic, Defence & Space Co. slid 1.9 percent after UBS AG removed it from its recommended list of stocks.
Johnson Matthey Plc (JMAT) climbed 3.2 percent after reporting a profit increase in the first half of the year. Daily Mail & General Trust Plc rose 2.3 percent after saying full-year results beat analysts’ estimates.
S&P 500 futures were little changed after the index dropped 0.4 percent yesterday to 1,781.37.
The MSCI Emerging Markets Index fell for a third day, losing 1.1 percent. India’s Sensex slid 1.8 percent, the most since September. Benchmark gauges in South Korea, Taiwan, Thailand and Turkey declined at least 1.2 percent. The rupiah, Malaysia’s ringgit, India’s rupee and South Korea’s won retreated at least 0.4 percent versus the dollar.
The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong fell 0.9 percent. A preliminary Purchasing Managers’ Index of China’s factory activity in November from HSBC Holdings Plc and Markit Economics dropped to 50.4 from 50.9 the previous month. Analysts surveyed by Bloomberg had expected a reading of 50.8, with 50 the dividing line between growth and contraction.
The dollar strengthened against all but one of its 16 major counterparts, rising most versus the yen. The Japanese currency declined 0.8 percent to 135.47 per euro. The Bloomberg U.S. Dollar Index rose 0.2 percent, advancing for a second day. The euro was little changed at $1.3436.
Australia’s dollar dropped to a two-month low after central bank Governor Glenn Stevens said he remained “open-minded” on currency intervention, even as policy makers had been unconvinced that the benefit of lowering the Aussie would outweigh costs. It fell as much as 0.8 percent to 92.57 U.S. cents, the lowest level since Sept. 16.
Spain’s 10-year bonds retreated for a fifth day, pushing the yield five basis points higher to 4.14 percent. The rate on similar-maturity U.K. gilts jumped six basis points to 2.79 percent. U.S. Treasury 10-year note yields were little changed at 2.79 percent after rising nine basis points yesterday.
The cost of insuring the securities against losses rose from a six-year low. The Markit iTraxx Crossover index added 2.4 basis points to 333 basis points.
Gold climbed 0.3 percent to $1,248.29 an ounce. West Texas Intermediate oil declined less than 0.1 percent to $93.78 a barrel.
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