Nov. 5 (Bloomberg) -- Stocks and commodities fell while the yen and government bonds rose as investors weighed when central banks will withdraw stimulus measures after the Federal Reserve signaled no change in its monetary policy.

The MSCI World Index of 23 developed markets declined 0.3 percent at 12:09 p.m. in London before announcements from the European Central Bank and the Bank of England. Futures on the Standard & Poor’s 500 Index fluctuated. Oil dropped below $80 a a barrel in New York. The yen strengthened against all 16 of the most-traded currencies and the dollar gained versus 13.

“It’s hard to predict when central banks will turn the corner and what this will mean for the market,” said Christoph Kind, head of asset allocation in Frankfurt at Frankfurt-Trust Investment GmbH, which manages about $20 billion. “It’s not as easy as last year, when every central bank was in a cutting mode.”

The Fed yesterday pledged to keep interest rates “exceptionally low” for an “extended period.” The Bank of England today increased its bond purchase plan by 25 billion pounds ($41 billion) to 200 billion pounds, less than economists had predicted. The ECB may chart a path to curbing stimulus measures when it meets today.

Central banks are debating whether the recovery can survive a withdrawal of emergency measures that have helped ease the worst global recession since World War II. U.S. initial claims for jobless benefits probably fell by 8,000 last week to 522,000, according to the median forecast of economists surveyed by Bloomberg News. Productivity probably surged in the July- September period, the survey showed, helping to drive down U.S. labor costs for a third consecutive quarter.

Asian Declines

The MSCI Asia Pacific Index retreated 0.5 percent after South Korea said it’s “unclear” whether the economic rebound will be sustained and New Zealand’s unemployment rate rose.

Samsung Electronics Co., Asia’s biggest maker of chips and mobile phones, lost 2.9 percent in Seoul. South Korea still faces a number of external risks, the Finance Ministry said in a monthly report.

Europe’s Dow Jones Stoxx 600 Index dropped 0.8 percent as insurers and raw-material producers retreated. Zurich Financial Services AG, Switzerland’s biggest insurer, fell 5 percent in Zurich and Munich Re, the world’s largest reinsurer, decreased 1.4 percent in Frankfurt. The companies reported earnings that trailed analysts’ estimates.

Futures indicated the S&P 500 may fall for the first time this week. Declines were limited after Cisco Systems Inc. reported earnings that topped projections. Cisco, the largest maker of networking equipment, gained 2.6 percent in Germany.

Emerging Markets

The MSCI Emerging Markets Index fell for the fourth time in five days, losing 0.5 percent. Dubai’s DFM General Index slid 2.6 percent after Moody’s Investors Service downgraded five of the emirate’s state-run companies yesterday because of tougher government criteria for financial support. Poland’s zloty and Hungary’s forint weakened 0.5 percent against the euro.

Crude oil for December delivery snapped three days of gains, falling 0.5 percent to $79.97 a barrel on the New York Mercantile Exchange. Three-month copper fell 0.7 percent to $6,530 a metric ton on the London Metal Exchange.

The yen advanced most against the South African rand, rising 1.3 percent, as investors sold higher-yielding currencies. It increased 1.2 percent versus the so-called kiwi after a report showed New Zealand’s unemployment climbed to the highest level in more than nine years.

Government bonds rose, with the yield on the 10-year Treasury note falling 2 basis points to 3.50 percent.

‘No Rush’

“It remains unlikely that the Fed, ECB and BOE would rush back in to reverse policies that took the financial system away from the brink only a matter of months ago,” Padhraic Garvey, head of investment-grade debt strategy at ING Groep NV in Amsterdam, wrote in a note to clients.

Credit-default swaps tied to high-yield European corporate bonds rose, retracing yesterday’s decline and signaling a deterioration in perceptions of credit quality. Contracts on the Markit iTraxx Crossover Index climbed 16.5 basis points to 540, according to JPMorgan Chase & Co.

To contact the reporters on this story: Daniel Hauck in London at dhauck1@bloomberg.net; David Merritt in London at dmerritt1@bloomberg.net.

Last Updated: November 5, 2009 07:12 EST