HSBC Holdings Plc tumbled 20 percent in London, the biggest drop since at least 1992, after saying it plans to raise 12.5 billion pounds ($17.7 billion) in a rights offer, increasing concern that financial firms need more capital. Mitsubishi UFJ Financial Group Inc., Japan’s biggest bank, retreated 6.8 percent as the nation’s wage declines accelerated. BHP Billiton Ltd., the world’s largest mining company, lost 5 percent as copper and nickel decreased and oil slid more than 5 percent in New York.
The MSCI World Index of 23 developed countries sank 2 percent to 735.62 at 12:27 p.m. in London, extending its 2009 decline to 20 percent, the worst start to a year since the gauge was created in 1970. The MSCI Emerging Markets Index slid 3.7 percent, while Hungary’s forint fell after European Union leaders spurned aid pleas for eastern Europe.
The MSCI Asia Pacific Index slid 3.4 percent as Mizuho Financial Group Inc. and Hynix Semiconductor Inc fell, while Europe’s Dow Jones Stoxx 600 Index slumped 3.8 percent, as the U.K.’s FTSE 100 Index sank 4.1 percent.
The Stoxx 600 has posted six straight monthly declines as the U.S. economy contracted at the fastest pace since 1982, forecasts at companies from Novartis AG to Deutsche Post AG disappointing investors, and the economic crisis in eastern Europe deepened.
The MSCI EM Eastern Europe Index slid 3.6 percent after European Union leaders spurned pleas for special aid for eastern Europe and a rescue package for automakers, bowing to German concerns over budget deficits as the economic crisis escalates.