Feb. 5 (Bloomberg) -- Asian stocks fell from a nine-month high, led by Toyota Motor Corp. on speculation the Group of Seven nations will press for a stronger yen, eroding the value of sales at exporters. China's shares extended a week-long slump.

``The market is worried that G-7 ministers will demand that the Bank of Japan raise interest rates and bring an end to the weak yen,'' said Tomokatsu Mori, who helps oversee $7.4 billion at Fukoku Capital Management Inc. in Tokyo.

China's shares dropped after official media said the state will crack down on banks that approve loans used to trade equities. Nissan Motor Co. slid the most in more than five years after cutting its profit forecast by 12 percent. BHP Billiton led mining stocks lower after copper and zinc prices tumbled.

The Morgan Stanley Capital International Asia-Pacific Index fell 0.6 percent to 141.83 as of 6:01 p.m. in Tokyo. Woodside Petroleum Ltd. led a measure of energy-related shares up 0.8 percent after oil prices climbed to the highest in a month.

In Japan, the region's biggest market by value, the Nikkei 225 Stock Average lost 1.2 percent to 17,344.80, while the broader Topix index declined 1.5 percent. Australian stocks slid from a record, while benchmarks also fell in China, Hong Kong and Indonesia. Singapore's Straits Times Index set a new high.

Toyota, which reports its third-quarter earnings tomorrow, dropped 1.6 percent to 7,820 yen. Honda Motor Co., Japan's No. 2 carmaker by sales, fell 3.6 percent to 4,530 yen.

Yen, G-7

The yen has gained against 13 of the 16 most-active currencies over the past five days after officials from France and Germany last week said its value doesn't reflect economic fundamentals.

Luxembourg Finance Minister Jean-Claude Juncker, who chairs a group of counterparts from the euro nations, said he wants to say ``more forcefully'' that the yen should reflect Japan's economic recovery. The G-7 meeting, which Junker will be attending, will take place on Feb. 9-10 in Essen, Germany.

The yen advanced to 120.65 recently against the dollar from 121.11 late in New York on Feb. 2. It climbed to 156.34 to the euro from 156.92. Yen gains erode the value of Japanese companies' overseas sales when converted into local currency.

China Minsheng Banking Corp., the country's first privately controlled lender, dropped 5.8 percent to 10.84 yuan. Shanghai Pudong Development Bank Co., part-owned by Citigroup Inc., lost 5.7 percent to 21.70 yuan.

Banking Watchdog

The China Banking Regulatory Commission said it will punish banks that approve loans used to trade stocks, state-run Xinhua News Agency said yesterday. The banking watchdog said the clampdown is scheduled to start Feb. 26, when trading resumes after the week-long Lunar New Year holiday.

The Shanghai and Shenzhen Composite Index has tumbled 12 percent in the past week after lawmaker Cheng Siwei, vice chairman of the National People's Congress, said mainland-listed stocks are overvalued.

``That's an alarm sounded by the regulators that stocks are already overvalued and now the government wants to cool it down,'' said Zhao Zifeng, who oversees about $1.1 billion at China International Fund Management Co. in Shanghai.

Nissan slumped 8.4 percent to 1,383 yen, its biggest decline since Sept. 21, 2001.

`Worse Again'

On Feb. 2, Japan's third-largest automaker cut its annual profit forecast 12 percent to 460 billion yen ($3.79 billion), citing higher raw-material costs and a lack of new models. Chief Executive Officer Carlos Ghosn said the automaker is developing an emergency plan to improve performance, including management changes, to be announced in April.

``When Ghosn took over, things were getting worse, and now they are getting worse again,'' said Edwin Merner, who oversees $1 billion as president of Atlantis Investment Research Corp. in Tokyo. ``Monthly sales figures have been bad for a long time.''

Nippon Telegraph & Telephone Corp. dropped 2.4 percent to 610,000 yen. Japan's former telephone monopoly last week lowered its forecast for operating profit, or sales minus the cost of goods sold and administrative expenses, by 7.7 percent to 60 billion yen at NTT East and 14 percent to 19 billion yen at NTT West.

BHP, the world's biggest mining company by market value and production, dropped 0.7 percent to A$26.41. Rio Tinto Group, the second-biggest by market value and third by production, declined 2.3 percent to A$75.49.

`Under The Gun'

Korea Zinc Co., the world's biggest smelter of the metal, dropped 3 percent to 83,900 won. Zinifex Ltd., the world's second-biggest zinc producer, lost 4.8 percent to A$15.99.

A measure of six metals traded on the London Metal Exchange, including copper and zinc, slumped 2.9 percent. Zinc plummeted 9.1 percent, the biggest drop since July 1997. Copper tumbled 4.6 percent, earlier reaching the lowest since March 27. In New York, copper fell 4.3 percent.

``The miners have been under the gun ever since metals started to come off their highs last year,'' said Karl Siegling, who helps manage the equivalent of about $50 million at Cadence Capital in Sydney. ``They're a big part of the market so it's usually a bad day when you get big slumps in metals.''

Industrial Bank Co., part-owned by a unit of HSBC Holdings Plc, surged 39 percent to 22.18 yuan on its debut in Shanghai after the $2 billion share offer attracted record bids from investors in China.

Chinese banks including Industrial & Commercial Bank of China Ltd. and Bank of China Ltd. saw their domestic shares climb after selling stock in 2006, enticing smaller competitors to follow suit.

Energy

Woodside Petroleum Ltd., Australia's second-biggest oil producer, rose 1.4 percent to A$38. PetroChina Co., the nation's largest oil company, gained 0.3 percent to HK$9.66 in Hong Kong. Nippon Oil Corp., Japan's biggest petroleum refiner, added 1.7 percent to 834 yen.

Crude oil rose as much as 0.6 percent to $59.36 a barrel in after-hours trading in New York. On Feb. 2, oil jumped 3 percent to $59.02, the highest close since Dec. 29. It was recently trading at $58.92.

Multiplex Group, the Australian builder struggling to complete London's Wembley stadium, jumped 5.5 percent to A$4.80. The company said Chief Executive Officer Andrew Roberts and his family may make a takeover bid with Canada's Brookfield Asset Management Inc. Roberts' father John founded Multiplex in 1962.

A takeover would come after Multiplex's three years as a public company were marred by lawsuits and regulatory probes over Wembley, which is more than a year overdue.

``It hasn't been a great number of years for the stock,'' said John Snowden, who oversees about $5.4 billion in property securities at Colonial First State in Sydney. After Multiplex's ``annus horribilus'' of Wembley losses and regulatory problems in 2006, ``if I were Andrew Roberts, I'd ask myself the question why did I ever take this company public?''

BHP Billiton (BHP AU)
China Minsheng Banking Corp. (600016 CH)
Honda Motor Co. (7267 JT)
Industrial Bank Co. (601166 CH)
Korea Zinc Co. (010130 KS)
Multiplex Group (MXG AU)
Nippon Oil Corp. (5001 JT)
Nippon Telegraph & Telephone Corp. (9432 JT)
Nissan Motor Co. (7201 JT)
PetroChina Co. (857 HK)
Rio Tinto Group (RIO AU)
Shanghai Pudong Development Bank Co. (600000 CH)
Toyota Motor Corp. (7203 JT)
Woodside Petroleum Ltd. (WPL AU)
Zinifex Ltd. (ZFX AU)

To contact the reporter for this story: Stuart Kelly in Sydney skelly22@bloomberg.net

Last Updated: February 5, 2007 04:14 EST