The Stoxx Europe 600 Index retreated 1.9 percent at 6 a.m. in New York. Standard & Poor’s 500 Index futures gained 0.4 percent, after losing as much as 3.2 percent. Treasuries, the benchmarks for the $34 trillion U.S. debt market that is more than twice the value of American equities, fell with the 10-year note yield increasing five basis points to 2.37 percent. The Italian 10-year yield slid 19 basis points to 5.10 percent. The franc appreciated against all of its 16 major peers. Oil sank 2.9 percent in New York, while gold topped $1,770 an ounce.
Fed policy makers will meet today after the unprecedented downgrade of the U.S.’s top credit rating shook investor confidence in America’s economic recovery. Speculation is growing that Chairman Ben S. Bernanke may announce new steps to pump up growth, after the S&P 500 tumbled 6.7 percent yesterday, the most since December 2008. Harvard University economist Kenneth Rogoff said the central bank will embark on a third round of asset purchases.
“The recent stock market falls have highlighted that world growth is weakening, raising the prospect of a recessionary scenario, and governments need to do something about that type of scenario,” said Jason Teh, who helps manage about $3 billion at Investors Mutual Ltd. in Sydney. “The question is, when do you expect the government to provide some sort of intervention measure or stimulus?”
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