The European stocks went down for a second day and commodities declined after the region’s services and manufacturing output suddenly shrank. U.S. equity-index futures declined, while German bonds increased.

The Stoxx Europe 600 Index lost 0.8 percent at 6:15 a.m. in New York. Futures on the Standard & Poor’s 500 Index slipped 0.2 percent. Copper retreated 0.6 percent. The German 10-year bund yield decreased four basis points to 1.94 percent, breaking a four-day climb. The dollar appreciated 0.6 percent to 80.18 yen, while the pound declined against 15 of its 16 main peers.

A measure of euro-area services and manufacturing production dropped to 49.7, London-based Markit Economics said, below the 50.5 forecast by economists in a Bloomberg survey. China’s manufacturing may shrink for a fourth month, according to data from HSBC Holdings Plc and Market. U.S. sales of previously owned homes probably rose last month to the highest level since May 2010.

FedEx Corp. (FDX) may try to leap into the bidding for TNT Express NV (TNTE) after the board of Europe’s second- largest package-delivery company discarded a $6.43 billion offer from United Parcel Service Inc. (UPS), investors and analysts said.

FedEx is the most understandable potential TNT suitor besides UPS, said Katrina Dudley, a portfolio manager at Mutual Series, a Franklin Templeton Investments unit whose funds own TNT stock. “It is a once-in-a lifetime chance for one of the players to create what I see as a strong global parcel franchise.”

TNT (TNTE) turned down UPS’s initial offer of 9 Euros a share while saying Feb. 17 that talks continue. That leaves an opening for FedEx, operator of the world’s biggest cargo airline, to swoop in to keep Hoofddorp, Netherlands-based TNT out of UPS’s hands, said Kevin Sterling, an analyst at BB&T Capital Markets. The prize would be expansion in Europe, where Deutsche Post AG (DPW)’s DHL leads in express deliveries.

The euro rise for a fourth day, copper advanced and Asian stocks pared victims after a European Union official said finance ministers have reached an agreement on a second bailout package for Greece.

The euro climbed 0.3 percent to $1.3276 as of 12:31 p.m. in Tokyo, reversing an earlier drop. Copper climbed 1.5 percent and oil traded near a nine-month high. The MSCI Asia Pacific Index (MXAP) declined 0.2 percent as airlines retreated on concern higher energy prices will reduce profits. Standard & Poor’s 500 Index futures advanced 0.5 percent. Ten-year Treasury yields rose three basis points to 2.03 percent.

European finance ministers had haggled into the night in Brussels over the terms of new loans to Greece and a possible contribution by central banks. They also bartered with bank representatives over a bond exchange meant to stave off the threat of a Greek default next month. Chinese Vice President Xi Jinping said yesterday that the global economy faces a mounting fight back as it seeks to make progress from a monetary crisis.

The European economy shrank less than economists estimate in the fourth quarter as a better-than- predicted performance in Germany and France helped mitigate the region’s first reduction since 2009.

Gross domestic product in the 17-nation euro area fell 0.3 percent from the prior three months, the first drop since the second quarter of 2009, the European Union’s statistics office in Luxembourg said today. Economists had forecast a drop of 0.4 percent, the median of 42 estimates in a Bloomberg News survey shows. In Germany, Europe’s largest economy, GDP dropped less than economists anticipated in the fourth quarter, while France’s economy surprisingly stretched in that period.

German companies have boosted output and spending over the past year to meet export demand, helping soften the impact of tougher budget cuts from Spain to Ireland. While Moody’s Investors Service cut the ratings of six of the region’s member states on Feb. 13, saying policy makers haven’t done enough to reinstate investor confidence, the economy is showing some signs of stabilization. Euro-region economic sentiment improved in January and services output expanded.

European (SXXP) stocks jumped, extending the Stoxx Europe 600 Index’s major rally in a week, as German investor confidence unexpectedly rose, offsetting downgrades of six euro-area countries by Moody’s Investors Service. U.S. index futures were little changed, while Asian shares retreated.

Royal Dutch Shell Plc (RDSA) gained 1.3 percent, dragging the Stoxx 600 higher. ThyssenKrupp AG (TKA), Germany’s biggest steelmaker, sank 2.7 percent after posting a first-quarter loss following project delays. TDC A/S (TDC), Denmark’s biggest phone company, dropped 4.6 percent after private-equity investors presented shares at a discount.

The Stoxx 600 gained 0.3 percent to 263.82 at 10:34 a.m. in London, extending yesterday’s 0.7 percent rally. The standard measure has advanced 7.9 percent this year amid optimism that the euro area will contain its crisis and as U.S. economic reports beat forecasts. S&P 500 futures expiring in March increased 0.1 percent today, while the MSCI Asia Pacific Index dropped 0.3 percent.

The Standard & Poor’s 500 Index’s biggest rally to start a year since 1991 is coinciding with a 15 percent increase in President Barack Obama’s re-election odds, viewing growing investor confidence in the U.S. financial system.

The benchmark gauge for American shares has climbed as much as 7.5 percent in 2012, the most in 21 years, as unemployment fell and Federal Reserve Chairman Ben S. Bernanke vowed to keep interest rates near zero through 2014, according to data compiled by Bloomberg. The price of a bet paying $10 should Obama win another term rose to $6 on Feb. 10 from $5.20 on Jan. 1 and below even money in November at Dublin-based bookmaker in trade.

An improved market clearly improves the president’s re- election chances,” David Kelly, who helps oversee $394 billion as chief market strategist for JPMorgan Funds in New York, said in a Feb. 8 interview. “The markets are pretty good at figuring this out.

Greek Prime Minister Lucas Papademos obtained approval from his Cabinet for deeper budget cuts needed to secure a second package of international aid, clearing the latest hurdle in his race to prevent financial collapse.  The Greek Cabinet approved the 287-page document unanimously, said a government official, who declined to be named. The sanction means the 300-seat Parliament will vote, most likely tomorrow, on budget measures totaling to 7 percent of gross domestic product over the next three years and a debt swap to slice 100 billion Euros off more than 200 billion Euros of privately-held debt.

The community cost this program involves will be incomplete compared to the financial and social disaster that would follow if we don’t adopt it, Papademos told his ministers previously, according to an e-mailed transcription of his comments. The success of the program and monetary support will strengthen our country’s future in the euro area. The sanction capped a week of worry in Athens as European Union and International Monetary Fund officials argued with Greek government officials over the conditions required to secure the 130 billion-euro rescue package.

Credit Suisse Group AG (CSGN), the second- biggest Swiss bank, said it had a loss in the fourth quarter for the opening time since 2008, hurt by “unfavorable” markets and costs to rearrange the investment bank.  Credit Suisse came down the most in five weeks in Zurich trading after posting a net loss of 637 million Swiss francs ($698 million), compared with an 841 million-franc profit in the year- earlier period. That missed the 446 million-franc average profit estimate of nine analysts surveyed by Bloomberg.

Credit Suisse Chief Executive Officer Brady Dougan said actions taken to speed up a revamp of the investment bank hurt earnings in the quarter. Dougan, who lowered the company’s profit target and announced two rounds of job cuts last year, is scaling down the securities division as the European sovereign debt emergency and stricter capital necessities crimp earnings. Pretax profit at the private bank dropped 43 percent with “passive” client activity in the fourth quarter.

Germany’s push to treat Europe’s financial crisis with austerity may fail by stifling its exports to the euro area, says Jerome Cahuzac, economic adviser to France’s Socialist presidential candidate. No state in Europe will acquire balanced budgets without development, Cahuzac, a lawmaker who also heads the Finance Committee at the lower chamber of Parliament, said in an interview in Paris Feb. 1. “It is also in the interest of Germany that growth stays everywhere and not just in Germany.”

His comments underscore the schism between Francois Hollande, the Socialist candidate who leads President Nicolas Sarkozy in polls, and policy makers in Berlin. Hollande has vowed to renegotiate the German-inspired treaty tightening budget rules endorsed by 25 European Union leaders last month, saying it is prejudiced against financial growth.

“A Hollande government might be on a collision course with Germany,” George Magnus, senior economic adviser at UBS AG, said in an e-mailed note Feb. 6 that pointed to the rising chance of a Hollande victory in the voting that concludes with a excess on May 6.

The American stock-index futures declined as China said industrial output growth will probably slow and investors waited for Greece’s politicians to accept spending cuts needed to secure financial aid.                   Anadarko Petroleum Corp. (APC), the major independent U.S. oil and natural-gas producer, grew 1 percent in German trading after reporting fourth-quarter earnings that beat estimates. Yum! Brands Inc. (YUM), the owner of the KFC and Taco Bell fast-food chains, gained 1.8 percent in early New York trading after posting periodical gross income that gained 30 percent.

Futures on the Standard & Poor’s 500 Index expiring in March fell 0.3 percent to 1,335.7 at 6:47 a.m. in New York. Dow Jones Industrial Average futures expiring the same month slid 19 points, or 0.2 percent, to 12,757 today. A Greek default will cause a correction of 5 to 10 percent in equities in Europe and perhaps less than half of that in the U.S., but it won’t be more.