Stocks in Europe, Asia Decline, Led by Banks; U.S. Futures Drop

Stocks in Europe, Asia Decline, Led by Banks; U.S. Futures Drop

By Adria Cimino

Nov. 19 (Bloomberg) — Stocks fell in Europe and Asia, led by financial firms and commodity producers, on concern the economic slowdown will cut profits. U.S. futures dropped before a report that may show consumer prices slid the most since 1949.

BNP Paribas SA, France’s biggest bank, ING Groep NV and Hannover Re retreated more than 5 percent. BHP Billiton Ltd. the world’s largest mining company, followed metal prices lower, decreasing 3.1 percent in London.

The MSCI World Index lost 0.5 percent to 857.18 at 8:55 a.m. in London as eight of 10 industry groups declined. More than $31 trillion has been erased from the value of global equities as writedowns and credit losses topped $966 billion in the worst financial crisis since the Great Depression.

“We’re in an uncertain environment,” said Julien Quistrebert, an equity analyst at KBL Richelieu Gestion in Paris, which oversees $5.1 billion. “The question is how long will the recession last and what will be the impact on companies.”

Europe’s Dow Jones Stoxx 600 Index declined 1.5 percent. Standard & Poor’s 500 Index futures lost 1.8 percent. The MSCI Asia Pacific Index slid 0.8 percent, retreating for a third day.

The cost of living in the U.S. probably slid in October by the most in almost six decades as fuel costs plummeted and retailers discounted merchandise to entice shell-shocked customers, economists said before a government report. Treasuries rose, and yields showed inflation expectations are the lowest in at least a decade.

A recession that may become the worst in decades raises the risk that deflation, or a prolonged decline in prices, will be another hazard facing Federal Reserve Chairman Ben S. Bernanke and President-elect Barack Obama. more

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