Nov. 18 (Bloomberg) -- Emerging-market stocks fell to the lowest level this month and bonds retreated as concern deepened that the global economic slump will erode earnings at raw- material producers, technology companies and banks.

Brazil's Bovespa Index fell to the lowest this month, prompting a company created by U.S. and Brazilian funds to invest in energy to cancel plans to sell shares in the country. China's CSI 300 Index tumbled 7.4 percent as lower coal and metals dragged down China Shenhua Energy Co. and Zijin Mining Group Co. Russian exchanges halted trading for an hour after benchmark indexes lost more than 5 percent. ICICI Bank Ltd. led a 3.8 percent retreat in India's Sensitive Index.

The MSCI Emerging Markets Index declined 4 percent to 499.08 at 3:45 p.m. New York time, the lowest level since Oct. 28. The gauge of equities in 25 developing markets has retreated 60 percent this year, led by a 72 percent drop in Russia and a 66 percent decline in China.

``There are still serious concerns for the economic outlook,'' said Henk Potts, a London-based fund manager at Barclays Stockbrokers, which has about $45 billion in assets under management. ``In the short-term we may still see some pretty negative corporate news weighing on sentiment.''

All emerging-market benchmark equity indexes declined except Israel. South Korea's Kospi dropped 3.9 percent, pulled lower by Samsung Electronics Co. after Eastman Kodak Co. filed a U.S. trade complaint against the mobile phone maker. The Jakarta Composite index in Indonesia declined 3.8 percent as a slumping currency reduced the odds of lower interest rates.

Yields Rise

The extra yield investors demand to own developing nations' bonds instead of U.S. Treasuries jumped 32 basis points to 7.07 percentage points today, according to JPMorgan Chase & Co.'s EMBI+ Index.

``Emerging markets continue to slide amid severe uncertainty over the state of the global economy,'' said Tat Auyeung, a fund manager at Apex Capital Management in Hong Kong, which oversees about $800 million. ``Traders are cautious and simply don't want to incur further losses.''

Japan was the latest developed economy to fall into a recession. Gross domestic product of the world's second-largest economy, shrank an annualized 0.4 percent in the three months ended Sept. 30, the Japanese Cabinet Office said yesterday.

Global semiconductor sales will probably fall next year because of the deteriorating economy, WSTC Inc., the industry's largest association, said today on its Web site. Chip sales may decline 2.2 percent to $256.1 billion in 2009.

Slowing Demand

Taiwan's Taiex index fell 3 percent, the lowest since May 2003, as HSBC Holdings Plc said slowing demand for electronics will hurt Hon Hai Precision Industry Co.

Hon Hai, the world's largest contract electronics maker, declined 6.9 percent after HSBC downgraded the stock to ``neutral'' from ``overweight.''

ICICI slid 5.6 percent. India's second-largest bank cut its target for lending growth by half to 15 percent as high borrowing costs and a slowing economy curb demand.

Asian stock markets were ``dragged down by global recession concerns and a wave of pending job losses in the financial sector,'' Nick Chamie, head of emerging-markets research at RBC Capital Markets in Toronto, wrote in a note to clients today.

Zijin Mining, China's largest gold producer, dropped 9.9 percent as gold fell as much as 1.2 percent and copper declined as much as 2.8 percent.

Latin Slump

In Latin America, Brazil's Bovespa index fell 4.5 percent, bringing its 2008 decline to 47 percent. Cia. Vale do Rio Doce contributed the most to the decline. The world's biggest iron- ore producer sank 4.8 percent to 23.14 reais.

The slump in Brazil's stock market prompted Empresa de Investimentos em Energia Renovaveis to shelve plans to sell shares.

Mexico's Bolsa fell 3 percent, while Chile's Ipsa slipped 1.2 percent.

Peru's IGBVL retreated 1.1 percent after Morgan Stanley cut its rating on Southern Copper Corp. to ``underweight'' from ``equal-weight,'' citing reduced growth expectations, lower metal and bulk price forecasts and higher costs. The world's seventh-largest copper producer sank 7.3 percent to $11.40.

To contact the reporter on this story: Michael Patterson in London at mpatterson10@bloomberg.net; Fabio Alves in New York at falves3@bloomberg.net;

Last Updated: November 18, 2008 15:49 EST