European stocks fell from a five-year high as the European Union cut its growth outlook and Bayerische Motoren Werke AG retreated after reporting results. U.S. index futures dropped, while Asian shares were little changed.
BMW, the world’s largest maker of luxury vehicles, slid the most in four months as profit declined. RSA Insurance Group Plc tumbled 7.1 percent as the U.K.’s biggest non-life insurer by market value said it will miss its profitability target after last week’s windstorms. Beiersdorf AG jumped 4.9 percent after the maker of Nivea hand cream increased its sales forecast.
The Stoxx Europe 600 Index fell 0.2 percent to 321.88 at 10:35 a.m. in London. The benchmark gauge has still soared 15 percent in 2013 as the Federal Reserve maintained stimulus measures and the European Central Bank cut interest rates to a record low. The ECB will make its next announcement on monetary policy on Nov. 7.
“We are all waiting for the ECB on Thursday,” Ion-Marc Valahu, a co-founder and fund manager at Clairinvest in Geneva, wrote in an e-mail. “Most investors are expecting a rate cut or some sort of stimulus measure, so there is room for disappointment.”
Standard & Poor’s 500 Index futures declined 0.2 percent today, after the U.S. gauge closed at a record. The MSCI Asia Pacific Index rose less than 0.1 percent.
The EU cut its forecast for euro-area growth next year as the economy struggles to gain momentum with the debt crisis dragging into a fifth year and unemployment at a record. Gross domestic product in the 17-nation currency bloc will rise by 1.1 percent in 2014, less than the 1.2 percent forecast in May, the Brussels-based European Commission said today.
The commission forecast that France’s budget deficit will be 3.7 percent of GDP in 2015, which would mean it misses a deadline to reduce the shortfall to 3 percent by then.
In the U.S., the Institute for Supply Management is due to release its non-manufacturing index at 10 a.m. New York time. The gauge will drop to 54 for October from 54.4 the previous month, according to a Bloomberg survey of economists. Readings greater than 50 signal expansion.
A government release on Thursday is forecast to show the U.S. economy grew at a 2 percent annualized rate in the third quarter, compared with a 2.5 percent increase in the previous three months. Economists predict a report the next day will show payrolls climbed by 120,000 in October, according to a separate survey.
“The U.S. non-farm payrolls at the end of the week will bring economic matters back in focus, following interest rate decisions from the Bank of England and ECB where no changes are expected,” Richard Hunter, head of equities at Hargreaves Lansdown Plc in London, wrote in an e-mail.
BMW sank 4.3 percent to 80.05 euros, the biggest drop since June 20. The automaker reported a 3.7 percent decline in third-quarter earnings before interest and taxes as spending on expansion offset stronger demand for the 3-Series sedan.
RSA plunged 7.1 percent to 119.9 pence, the largest slide in eight months, after saying wind damage in Europe and adverse weather in Canada will push return on equity below 10 percent for the year. That compares with a previous target range in August of 10 percent to 12 percent.
Beiersdorf climbed 4.9 percent to 73.16 euros, the biggest gain since March, after saying sales will rise 6 percent to 7 percent this year. The Hamburg-based company had previously forecast revenue would increase 5 percent to 6 percent.
Marks & Spencer Group Plc (MKS), the U.K.’s largest clothing retailer, advanced 3.1 percent to 502 pence after reporting the smallest decline in general-merchandise sales in more than two years. Sales at stores open at least a year fell 1.3 percent in the quarter ended Sept. 28, M&S said. That beat the median estimate of 17 analysts for a 1.5 percent drop.