Dow Industrials Stocks Fall in Europe; GM Shares Drop (Correct)

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Dec. 2 (Bloomberg) -- Dow Jones Industrial Average stocks fell in Europe as the dollar dropped to a record against the euro. Shares of General Motors Corp. and Hewlett-Packard Co. paced the decline.

``If it stays weak for too long, it's an indication that foreign investors do not have faith in investing in the U.S. and that could end up being dangerous for the stock market,'' said John Forelli, at Independence Investments in Boston, which oversees $10 billion in assets.

Intel Corp. declined before the world's largest computer chipmaker gives investors an update on fourth-quarter results.

Standard & Poor's 500 Index futures expiring in December fell 0.5 to 1189.50 as of 9:27 a.m. in London. Dow average futures lost 11 to 10,562 and Nasdaq-100 Index futures gained 0.5 to 1603. All but 2 of the 25 Dow stocks trading in Europe fell.

The S&P 500 closed at its highest since Aug. 7, 2001, after crude-oil prices plummeted more than $3 a barrel.

The U.S. currency fell to a record against the euro and below 102 yen for the first time since 2000 as Japanese Finance Minister Sadakazu Tanigaki said Europe and Japan aren't yet ready for joint action to stem the currency's slide.

The dollar weakened to $1.3385 per euro, and traded at $1.3367 at 8:14 a.m. in London from $1.3345 late in New York yesterday, according to electronic currency-dealing system EBS.

General Motors, the world's biggest carmaker, dropped 15 cents to $38.59 in Germany. Hewlett-Packard, the No. 2 maker of personal computers, lost 17 cents to $20.35.

Sales Forecast

Intel fell 6 cents to $23.06, also in Germany. The company may say fourth-quarter sales will reach the high end of its projections as demand for laptops grows during the holiday shopping season.

Analysts including Lehman Brothers Inc.'s Timothy Luke and Prudential Equity Group's Mark Lipacis raised their estimates in the past two weeks, and at least eight expect revenue of $9 billion or more in the year's final three months.

Shares of Microsoft Corp. lost 4 cents to $27.21 in Germany. Chief Financial Officer John Connors said he plans to increase purchases of stocks and higher-yielding debt after paying a record $32.6 billion special dividend today to shareholders.

NTL Inc. shares may be active. A fund managed by Macquarie Bank Ltd., Australia's largest investment bank, agreed to buy the cable TV operator's U.K. transmission towers for 1.27 billion pounds ($2.47 billion). New York-based NTL's towers are also used by mobile-phone companies. The stock doesn't trade in Europe.

The number of U.S. workers filing initial applications for unemployment benefits may have risen last week after reaching the lowest level in two months, economists said before today's Labor Department's report.

Jobless Claims

Jobless claims may have totaled 330,000, up from 323,000 the week before, according to the median forecast of 37 economists in a Bloomberg News survey. First-time claims have ranged from 323,000 to 355,000 since the beginning of October to average 337,630 a week, and payrolls are expanding. The report is due at 8.30 a.m. in Washington.

Factory orders may have increased in October after falling for two months in a row, economists said in advance of a report from the Commerce Department. Orders probably rose 0.2 percent for the month after declining 0.4 percent in September, according to the median of forecasts. The manufacturing report is scheduled for release at 10 a.m. in Washington.

The government may report tomorrow that U.S. companies added 190,000 workers last month, based on the median forecast of 72 economists surveyed by Bloomberg. That would bring the number of people hired in the past six months to more than 1 million. The U.S. created 337,000 jobs in October.

Morgan Stanley Capital International Inc.'s Asia-Pacific Index, which tracks more than 900 companies, rose 2.1 percent as of 4:32 p.m. in Tokyo. Japan's Nikkei 225 Stock Average lost 0.6 percent.

The S&P 500 rose 17.55, or 1.5 percent, to 1191.37 and the Dow average gained 162.20, or 1.6 percent, to 10,590.22. The Nasdaq Composite Index climbed 41.42, or 2 percent, to 2138.23, the highest since Jan. 26.

To contact the reporter on this story: Margo Towie in Brussels at mtowie@bloomberg.net.

Last Updated: December 2, 2004 04:33 EST