European Stocks Decline for Sixth Day; Pirelli, Daimler Drop
October 04, 2010, 5:20 AM EDT
By Adam Haigh
Oct. 4 (Bloomberg) -- European stocks retreated for a sixth day, the longest stretch of losses since January 2009, after last week falling the most in three months. U.S. index futures declined, while Asian shares gained.
Pirelli & C. SpA and Daimler AG led a retreat in auto shares. Gas Natural SDG SA lost 3.4 percent after saying a ruling related to a gas dispute with Algeria’s Sonatrach may reduce profit by as much as 450 million euros ($619 million). Inmarsat Plc slid 2.5 percent after the Sunday Times reported Harbinger Capital Partners is preparing to sell a third of its stake in the provider of satellite services.
The Stoxx Europe 600 Index sank 0.7 percent to 257.38 at 10:16 a.m. in London, as all 19 industry groups declined. The gauge fell 1.9 percent last week amid concern the European economy is slowing as the sovereign-debt crisis curbs growth, extending the decline from this year’s high in April to 4.8 percent. The index rallied 6.7 percent in the third quarter on speculation the Federal Reserve and other central banks will step in to provide more stimulus for the ailing recovery.
“There’s concern still about an overhang, about a double dip in the U.S.,” said Philip Poole, the London-based global head of macro and investment strategy at HSBC Global, which oversees more than $400 billion.
The MSCI Asia Pacific Index gained 0.1 percent today, while futures on the Standard & Poor’s 500 Index expiring in December fell 0.6 percent.
U.S. Economy
In the U.S., a report today may show the number of contracts to purchase previously owned homes increased in August for a second month, a sign the housing market is stabilizing.
The National Association of Realtors’ index of pending home resales rose 2.8 percent in August after a 5.2 percent gain the prior month, according to the median forecast of 30 economists surveyed by Bloomberg News. A separate report may show a transportation equipment-led decline in factory orders.
China’s non-manufacturing industries expanded at a faster pace in September. A purchasing managers’ index released yesterday by the China Federation of Logistics and Purchasing rose to 61.7 from 60.1 in August. The data follow a jump to a four-month high for the manufacturing PMI announced on Oct. 1.
China will address “structural problems” and stabilize its economy by increasing domestic demand, Premier Wen Jiabao said in an interview with CNN broadcast yesterday. Wen said he’d argued before the global recession that China’s economic development “lacks balance, coordination and sustainability.”
Pirelli, Daimler
Pirelli, Europe’s third-largest tiremaker, retreated 2.2 percent to 5.83 euros. Daimler, the second-biggest maker of luxury cars, lost 2.9 percent to 44.21 euros. A measure of auto shares dropped 2.3 percent, the biggest decline among 19 industry groups.
Gas Natural lost 3.5 percent to 10.37 euros after saying a ruling related to a gas dispute with Sonatrach may lead to a reduction in 2010 profit of as much as 450 million euros should its challenges fail. Gas Natural said the decision of the arbitration panel was “abusive” and the company is trying to challenge it.
Inmarsat slipped 3.6 percent to 644.5 pence. Harbinger Capital Partners is preparing to sell a third of its stake in the provider of satellite services as it seeks to raise money to invest in other companies, the Sunday Times reported, without saying where it got the information. Harbinger will sell about 300 million pounds ($474 million) of shares, reducing its stake from just under 30 percent to 20 percent, the newspaper said.
Wellstream Holdings Plc rose 2.2 percent to 790.5 pence after the Sunday Times said General Electric Co. made a bid worth more than 800 million pounds for the oilfield-services provider, citing unidentified people close to the matter. Wellstream hired Rothschild & Sons Ltd. and Credit Suisse Group AG as advisers, it said.
SEB AB, Sweden’s third-biggest bank by market value, advanced 1.1 percent to 50.1 kronor as JPMorgan Chase & Co. upgraded the shares to “overweight” from “neutral.”
--Editors: Andrew Rummer, David Merritt.
To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net
To contact the editor responsible for this story: David Merritt at dmerritt1@bloomberg.net.
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