BY ROSS KELLY

SYDNEY—Macquarie Group Ltd. forecast a worse-than-expected 25% fall in annual profit and said it shut derivatives businesses in Europe, the U.S. and Asia as tough market conditions continue to plague the world's investment banks.

Global economic uncertainty has deepened since October 2011, with substantially lower levels of client activity in many markets, Chief Executive Nicholas Moore told an investor briefing.

Mr. Moore indicated that Australia's biggest investment bank would rather invest surplus capital in its own beaten-down shares than any large acquisitions but added that opportunities could arise in Europe. Macquarie said Tuesday that it will carry out ...