Stock market fixing:

Nikkei 225 -280.55 -2.1% 13,023.05
Topix -24.94 -2.0% 1,246.48
FTSE -85.90 -1.55% 5,448.60
DAX -163.68 -2.49% 6,422.19
CAC -115.51 -2.56% 4,402.97
Dow -109.51 -0.94% 11,532.96
NASDAQ -1.99 -0.08% 2,428.62
S&P -3.76 -0.29% 1,285.83
10yr Note +0.2900 +0.074% 3.947%
NYMEX Crude Oil +2.99 +2.65% 116.00
Gold +16.90 +2.07% 831.50

Japan Stocks Fall as GDP Drop Points to Dimmer Earnings Outlook
Japan's stocks fell after the nation's economy shrank for the first time in a year, pointing to dimmer earnings prospects for financial companies.
Orix Corp., which provides leasing and consumer loans, dropped to the lowest in more than four months, while Nomura Holdings Inc., Japan's biggest brokerage, sank the most in three weeks. T&D Holdings Inc. sent a gauge of insurers to the lowest in four months after first-quarter profit declined by two-thirds. Advertisers Dentsu Inc. and Asatsu-DK Inc. plummeted after reducing their forecasts as businesses cut back on marketing.
Japan's gross domestic product shrank an annualized 2.4 percent in the three months to June 30, the Cabinet Office reported today before markets opened, the first such decline in a year. Of 1,142 Japanese companies that have released first- quarter earnings so far, 59 percent posted a decline profit, Shinko Research Institute Co. said in a report dated today.
Meanwhile, U.S.-based JPMorgan Chase & Co. said yesterday that capital markets will ``remain under stress'' as it reported new asset writedowns, helping push global subprime-related losses to more than $500 billion.
Orix, the nation's largest non-bank financial company, tumbled 5.7 percent to 13,700 yen, the lowest since March 31. Nomura retreated 4.4 percent to 1,505 yen, while Sumitomo Trust & Banking Co. fell 5.7 percent to 673 yen. Gauges tracking financial companies were the four biggest losers among 33 industry groups on the Topix.
Urban fell by a record on Aug. 11 and declined to 62 yen today, 4.2 percent of its value at the beginning of this year. The builder declared bankruptcy after the close of trading today with about $2.35 billion in debt.
T&D, the nation's second-largest publicly traded insurer, plummeted 5.7 percent to 5,590 yen, the lowest since April 10. The company yesterday reported a 68 percent drop in first-quarter net income as interest and dividend income fell. Insurance companies, which were the fourth-biggest winner among Topix groups yesterday, posted the third-biggest drop today.
Goldman Sachs Group Inc. analyst Takehito Yamanaka downgraded T&D to ``neutral'' from ``buy'' and removed it from the brokerage's buy list.
Dentsu, Japan's biggest advertising company, sank 4.6 percent to 210,300 yen, the lowest since March 18. The company yesterday cut its annual profit target by 2.8 percent, saying customers are keeping a ``cautious stance'' toward advertising spending. Smaller rival Asatsu-DK Inc. lost 6.6 percent to 2,765 yen after slashing its profit target by a quarter.

European Stocks Drop, Led by Banks; Hypo Real Estate, UBS Fall
European stocks declined the most in a month as concern deepened that banks will report more losses and the economic slowdown will drag down earnings.
Hypo Real Estate Holding AG, Germany's second-biggest commercial-property lender, fell 4.9 percent after reporting a 95 percent slump in profit because of writedowns on debt-related investments. UBS AG and Barclays Plc both sank more than 7 percent as Merrill Lynch & Co. strategist Richard Bernstein said the credit crisis is ``far from over.'' DSG International Plc tumbled 11 percent after JPMorgan Chase & Co. recommended selling the retailer's shares on the outlook for earnings growth.
Stocks extended losses after a bigger-than-forecast drop in gasoline inventories sent crude oil up more than $2 a barrel. A government report showed today sales at U.S. retailers dropped in July for the first time in five months as record gasoline prices and tighter credit reduced automobile purchases.
National benchmark indexes sank in all 18 western European markets. The U.K.'s FTSE 100 slipped 1.6 percent. France's CAC 40 slumped 2.6 percent and Germany's DAX fell 2.5 percent.
A report today showed U.K. unemployment rose the most in almost 16 years in July as the deepening slowdown pushed companies to cut jobs. The Bank of England lowered its growth forecast for the economy to about 0.1 percent on a year-on-year basis in the first quarter of 2009, down from 1 percent earlier.
Hypo Real Estate fell 4.9 percent to 17.74 euros, the steepest drop since June 26. The lender said second-quarter pretax profit plunged 95 percent and that market conditions are ``still uncertain.'' It reported an investment loss of 135 million euros ($202 million) in the quarter, higher than the 46 million euros in a Bloomberg survey of analysts.
UBS tumbled 7.3 percent to 20.98 francs. Analysts at Lehman Brothers Holdings Inc. and Deutsche Bank AG cut their share-price estimates for UBS after Switzerland's largest bank reported its fourth straight quarterly loss yesterday.
Barclays, Britain's third-biggest lender, sank 7.1 percent to 351.5 pence today.
More than $12 trillion has been erased from global equity markets this year as credit-related losses topping $500 billion and accelerating inflation threaten economic and profit growth.
Writedowns and losses have made banks the worst performers worldwide this year and led analysts to cut profit estimates. Earnings for financial firms in the Stoxx 600 will drop 25 percent this year, more than 10-fold the projected decline for all companies in the measure, according to analysts' estimates compiled by Bloomberg. Analysts predicted profit for the group to fall 3.9 percent at the start of the year.
DSG, the largest consumer-electronics retailer in the U.K., tumbled 11 percent to 54.5 pence, after subtracting for the effect of its dividend payout.
The ability for the company to improve its finances with asset sales is ``misplaced'' and the economic environment in all of the company's main markets continues to deteriorate, JPMorgan said today, downgrading the stock to ``underweight'' from ``neutral.''
Arcandor AG sank 13 percent to 6.94 euros. Germany's biggest department-store operator cut its earnings forecast after sales at the company's Karstadt chain declined.
OC Oerlikon Corp. fell 6 percent to 261.75 francs after the world's biggest maker of spinning machines for textiles reduced its profit forecast for 2008. Oerlikon predicted a 33 percent drop in operating profit, and will book 350 million francs ($322 million) in writedowns from three units.
Barratt Developments Plc, Britain's second-biggest homebuilder, sank 15 percent to 135.5 pence. Larger rival Taylor Wimpey Plc declined 8.1 percent to 53.75 pence.
Rising unemployment may exacerbate the housing slump and replace the credit squeeze as the main driver of weakness, Panmure Gordon & Co. analyst Rachael Waring said.
CSM NV, the world's largest supplier of ingredients to bakeries, tumbled 17 percent to 19.92 euros after saying price increases will hurt sales in the U.S. and delaying a profitability goal.

Wall Street retreat amid concerns about a consumer spending slowdown in an already strapped economy
Stocks slumped Wednesday morning, extending the previous session's slide, as investors eyed a weak retail sales report, higher oil prices and the latest financial market woes.
Those concerns spread into Wednesday's market and were compounded by the retail sales report. A positive reaction to a few tech earnings reports helped limit losses for theNasdaq.
July retail sales fell 0.1% from the previous month, in line with estimates and reflecting the end of the impact from the government stimulus checks. Sales excluding autos rose 0.4%, the government said, with results falling short of the expected rise of 0.5%.
Applied Materials reported sales and earnings late Tuesday that tumbled from a year ago due to the tough industry environment. Nonetheless, results edged out analysts' estimates.
Deere & Co. reported higher third-quarter sales and earnings that topped sales forecasts and missed earnings expectations. The tractor maker also warned that higher raw material costs would crimp fourth-quarter profit margins.
Toll Brothers warned that home-building revenue fell about 34% in the fiscal third quarter because of the housing market collapse. The luxury homebuilder also reported a big drop in net contracts signed, and said that it is not comfortable providing an earnings outlook due to the state of the market.
However, analysts were expecting a bigger drop in home-building revenue, and Toll stock managed to inch higher.
U.S. light crude oil for September delivery rose $2,37 to $115.38 a barrel on the New York Mercantile Exchange Tuesday.
Oil prices rose ahead of the weekly oil inventories report, due out at 10:35 a.m. ET. Also, investors were monitoring fighting between Russia and Georgia, which has continued despite an announced cease-fire Tuesday. Georgia serves as an important hub for transporting fuel between Asia and Europe.
In the bond market, Treasury prices tiptoed higher, lowering the yield on the benchmark 10-year note to 3.90% from 3.99% late Monday.
COMEX gold for October delivery rose $11.20 to $822 an ounce.

The yen rose to a 12-week high against the euro and its strongest level in two months versus the pound as investors in Japan reduced bets on higher-yielding assets abroad.
Japan's currency climbed to a two-year high against New Zealand's dollar and a four-month high versus Australia's dollar on speculation central banks will lower interest rates.

The pound fell to a 22-month low against the dollar after the Bank of England cut its growth forecast and unemployment increased the most in almost 16 years. The Bank of England forecast that if rates are left on hold, inflation will be below target in two years time, undermining the case for a rate hike and leaving the door open to slight monetary easing. Based on constant 5% Bank Rate, theBOE's August Inflation Report showed CPI clearly falling below 2% in two years' time. On market rate assumptions inflation also falls back to around 1.8% in two years time and continues to fall further in the third year. TheBOE's implied rate assumptions showed rates broadly on hold through 2009 before rising by almost 25 basis points from the second half of 2010. Overall, the report is less hawkish than many analysts' had expected. ``The global economy is definitely slowing down, and people are trying to avoid risks,'' said Hidetoshi Yanagihara, senior currency trader at Mizuho Corporate Bank in New York. ``They're buying back the yen because the interest-rate differential between Japan and the rest of the world is going to shrink.''
``The euro zone is quickly plunging into a negative GDP environment right now,'' said Greg Salvaggio, a vice president of capital markets in Washington at Tempus Consulting, a currency-trading company. ``That's the backdrop that's leading investors to run to the exits on the euro.''
Europe's economy shrank 0.2 percent in the second quarter, following 0.7 percent growth in the previous three months, according to the median forecast of 40 economists.
``We are starting to see the beginning of the cyclical recovery of the dollar,'' said Vassili Serebriakov, a currency strategist at Wells Fargo & Co. in New York. ``It's mainly because global growth is slowing.''
The U.S. Dollar Index, which tracks the currency against six trading partners, yesterday touched 76.616, the highest level since Feb. 12. The index has advanced 3.9 percent since July 31. Last week's 3.3 percent gain was the biggest since January 2005.

Thursday European data starts at 0600GMT with the first of the slew of flash GDP and final HICP releases. German Q2 flash GDP and July final HICP, CPI data are due at 0600GMT and are expected to show flash GDP at -0.8% SA q/q. The final CPI is expected to edge higher, to 0.6 % m/m, 3.3% y/y, while final HICP is also seen edging higher to 0.6% m/m, 3.4% y/y. France data at 0645GMT is expected to show the Q2 GDP at +0.2% q/q, while Q2 non-farm payrolls are forecast to come in at 0.2% m/m, 1.4% y/y with monthly salaries at 0.7% m/m, 2.9% y/y. Eurozone Q2 flash GDP and July final HICP are due at 0900GMT when the flash GDP is forecast to come in at -0.2% q/q, +1.5% y/y. Final HICP is expected at -0.1% m/m, 4.1% y/y.
US data starts at 1230GMT with the weekly jobless claims and CPI data for July. Jobless claims are expected to slide 23,000 to 432,000 in the Aug. 9 week on the continued impact of the emergency benefit extension program. The CPI is expected to rise 0.4% in July on a further jump in energy prices. Core CPI is forecast to increase 0.2%.
August 4 week.