Stocks in Europe, Asia Decline

Stocks in Europe and Asia fell, sending the MSCI World Index lower for a third straight day, as concern deepened the global recession will erode profits. U.S. index futures advanced., Bloomberg 1/21/2009 5:08:54 AM

Barclays Plc and BNP Paribas SA tumbled at least 5 percent amid speculation banks may need more capital. ThyssenKrupp AG, Germany’s largest steelmaker, declined 2 percent as Morgan Stanley advised clients to sell shares, saying 2009 could be the worst year for the industry on record. China Life Insurance Co., the nation’s biggest insurer, sank 7.5 percent after saying 2008 profit may have fallen by at least 50 percent.

The MSCI World lost 6.12, or 0.7 percent, to 816.49 at 12:19 p.m. in London. The measure has dropped 11 percent this year as companies from Alcoa Inc. to Deutsche Bank AG fueled concern the global recession will wipe out profit growth.

Europe’s Dow Jones Stoxx 600 Index slipped 1.6 percent, while the MSCI Asia Pacific Index declined 2 percent. Futures on the Standard & Poor’s 500 Index rose 0.6 percent as International Business Machines Corp. forecast annual profit that beat analysts’ estimates.

The MSCI World has extended last year’s record tumble, erasing more than two thirds of a 23 percent rally since Nov. 20 as optimism that government measures and interest-rate cuts would revive the global economy evaporated.