Stocks in Europe, Asia Decline

Stocks in Europe and Asia retreated, extending the MSCI World Index worst start to a year, as the deepening recession eroded earnings and pushed German business confidence to a 26-year low., Bloomberg 2/24/2009 5:28:09 AM

Basilea Pharmaceutica AG tumbled 36 percent after the Swiss developer of anti-infection drugs reported a full-year loss and said a regulatory review of its Ceftobiprole treatment was delayed. Novartis AG, Switzerland’s second-biggest drugmaker, dropped 2.8 percent as Chief Executive Officer Daniel Vasella said pressure on drug prices and patents will grow this year. Nomura Holdings Inc., Japan’s largest brokerage, slumped 9.3 percent on its plan to sell shares after four quarterly losses.

The MSCI World slid 0.6 percent to 752.41 at 12:37 p.m. in London, falling for an 11th day, the longest stretch since 2005. The gauge of 23 developed countries retreated 18 percent in 2009 as companies from Anglo American Plc to Cie. de Saint-Gobain SA indicated the recession is worsening. This year’s drop is more than double the slump at the same point in 2008.

Europe’s Dow Jones Stoxx 600 Index lost 1.5 percent as Basilea Pharmaceutica AG tumbled and ING Groep NV led declines among insurance stocks. The MSCI Asia Pacific Index fell 1.8 percent to 74.92, the lowest since August 2003.

The MSCI World has retreated 53 percent since the start of last year as credit-related losses at financial firms worldwide climbed to $1.1 trillion and Europe, the U.S. and Japan fell into the first simultaneous recessions since World War II.

German business confidence declined to a 26-year low in February as the worst recession since World War II prompted companies to curb production and lay off workers. The Ifo institute in Munich said its business climate index, based on a survey of 7,000 executives, fell to 82.6 from 83 in January.

Japanese stocks fell for a third day as Nomura Holdings Inc.’s equity sale to rebuild capital raised concern shareholder value will be reduced. The Nikkei slid 107.60, or 1.5 percent, to close at 7,268.56 in Tokyo, recovering from a 3 percent drop that sent the gauge to the lowest since October 1982.