European stocks declined, led by the food and beverage and mining shares after Nestle SA and BHP Billiton posted profit that lagged analysts' estimates. The Dow Jones Stoxx 50 Index dropped 0.6 percent to 2554 as of 9:41 a.m. in London. The Stoxx 600 fell 0.5 percent, led by the food and drinks makers group, which declined 1.6 percent. The Euro Stoxx 50, a benchmark for the 12 countries sharing the euro, shed 0.5 percent. ``Earnings are not going to be as good from now on,'' said Mike Bayer, who helps manage the equivalent of $310 million at Ceros Vermoegensverwaltung in Frankfurt. ``We have to be prepared for even more disappointments.''
Earnings for companies in the Stoxx 600 will probably rise an average of 10 percent next year, slowing from an average gain of 24 percent this year, according to JCF Group, a compiler of analyst surveys. Stocks extended declines after Google Inc., the world's most- used Internet search engine, said it reduced the price range on its initial public offering to between $85 and $95 a share. The previous price range was $108 to $135. BHP Billiton, the world's biggest mining company, slipped 2.4 percent to 511.25 pence after it said fiscal full-year net income rose 78 percent to $3.38 billion from a year-earlier. The median estimate of eight analysts surveyed by Bloomberg News was for profit of $3.43 billion. Nestle, the world's biggest food company, fell 3.7 percent to 302.5 Swiss francs. First-half net income rose 2.1 percent from a year earlier to 2.84 billion francs ($2.28 billion) as sales in Western Europe declined. The median forecast of eight analysts surveyed by Bloomberg News was for 2.95 billion francs.
Groupe Danone, the world's biggest yogurt maker, slid 0.8 percent to 65.45 euros. Rio Tinto Plc, the world's third-largest mining company, declined 1.1 percent to 1,374 pence. The basic resources group was the second-biggest decliner on the Stoxx 600, slipping 1 percent. All of the 17 benchmark indexes in Western European markets That were open fell, except for Austria and Luxemburg. France's CAC 40 Index shed 0.5 percent. Germany's DAX Index declined 0.3 percent and the U.K.'s FTSE 100 Index slipped 0.5 percent. September futures on the Euro Stoxx 50 fell 0.3 percent. Equant NV, the operator of the world's biggest data-communications network, slid 3.6 percent to 2.96 euros. The company is leaving Europe's Dow Jones Stoxx 600 Index on Sept. 20, Stoxx Ltd. said. Snecma SA, France's state-controlled maker of aircraft engines, which will join the Stoxx 600 Index, added 0.7 percent to 15.90 euros. Gestevision Telecinco SA, Spain's largest commercial television station, gained 0.7 percent to 12.80 euros. The company will also join the index. Joining or leaving an index can affect a company's share price because funds that track the benchmark need to buy the shares of its members.
Rentokil Initial Plc, the world's largest pest-control business, fell 3.8 percent to 151 pence, the biggest decline in three months. The company may say that following an internal review it won't sell its conferences and parcels delivery business, the Financial Times reported, without citing anyone. The shares shed as much as 20 percent on May 19, the most in at least 15 years, when the company said full-year profit will be ``substantially'' below forecasts following the loss of cleaning contracts. Stocks in the U.S., Europe's biggest export market, rose for a third straight day after an unexpected drop in consumer prices encouraged investors that the Federal Reserve may be able to slow the pace of interest-rate increases. The Standard & Poor's 500 Index rose 0.2 percent to 1081.71. The Dow Jones Industrial Average also gained 0.2 percent to 9972.83. The Nasdaq Composite Index added 0.7 percent to 1795.25. Benchmark indexes pared gains as oil prices reached records.
Crude-oil futures were unchanged at $46.75 a barrel in New York after yesterday gaining as much as 1.5 percent to a record of $46.95. The U.S. reported factory output and home building rose, adding to concern fuel inventories of the world's biggest energy user may drain faster than they are replenished. ///www.bloomberg.com