Asia Stocks Fall on U.S. Budget Impasse, Weaker Economic Growth

Asian stocks fell for a fifth day, the longest streak in almost four months, amid concern economic growth in Asia is slowing and U.S. lawmakers may fail to agree on measures to cut the nation’s budget deficit.

Genting Singapore Plc (GENS) and CapitaLand Ltd. (CAPL) each fell more than 2.2 percent, leading declines in the Straits Times Index as Singapore’s trade ministry said economic growth may slow next year. Fanuc Corp., which makes industrial robots, lost 2.1 percent after Japanese exports fell for the first time in three months. Elpida Memory Inc. (6665), the world’s third-largest memory- chip maker, sank 7.3 percent after an industry report showed Japan’s chip-equipment orders fell 33 percent from a year ago.

The MSCI Asia Pacific Index retreated 1.5 percent to 112.49 at 8:34 p.m. in Tokyo. The gauge has lost more than 1 percent in three of the last five trading sessions. Singapore’s Straits Times Index (FSSTI) declined 1.2 percent, the lowest close in a month. Hong Kong’s Hang Seng Index sank 1.4 percent and Japan’s Nikkei 225 Stock Average slipped 0.3 percent.

“There’s likely to be a continuing impasse and people will focus on the stability of the U.S. politically,” said Tim Schroeders, who helps manage $1 billion in equities at Pengana Capital Ltd. in Melbourne. “People will probably sit on the sideline and wait for clarity.”

The deficit-cutting U.S. congressional supercommittee is expected to announce today that it has failed to reach agreement on at least $1.2 trillion in federal budget savings, a Democratic aide said. The aide, who wasn’t authorized to discuss internal matters publicly and requested anonymity, said in an e- mail that it was highly unlikely that the talks could be salvaged.

U.S. Stocks

Futures on the Standard & Poor’s 500 Index fell 1.7 percent to 1,193.90. The U.S. equity benchmark posted its biggest loss in two months last week as Fitch Ratings said Europe’s debt crisis poses a threat to American banks.

Deutsche Bank AG Chief Executive Officer Josef Ackermann said Europe needs a “firewall” to prevent its debt crisis from spreading and should increase the size of its rescue fund. In Spain, conservative Mariano Rajoy swept the Socialists out of power with the biggest parliamentary majority in an election in almost 30 years. He told Spaniards to brace themselves as the nation fights to avoid being overwhelmed by the debt crisis.

Longfor Properties Co., the developer controlled by China’s richest woman, Wu Yajun, tumbled 5.4 percent to HK$7.89. China State Construction International Holdings Ltd. (3311) sank 9 percent to HK$4.97.

China ‘Weakness’

“Weakness” in China’s stocks may last until the end of the year as the government is unlikely to introduce more “powerful” measures to fine-tune economic policies, according to Citic Securities Co. Sentiment will be negative as investors begin to worry about slumping property sales and the pace of new share sales, Liu Haobo, an analyst at the brokerage, wrote in a report today.

Genting Singapore, which operates casinos, slumped 2.6 percent to S$1.50. CapitaLand, a developer that gets about 36 percent of its revenue from the city-state, fell 2.3 percent to S$2.56.

Singapore Growth

Singapore’s economy will grow 1 percent to 3 percent in 2012, the trade ministry said in a statement. Non-oil domestic exports will probably rise 2 percent to 3 percent in 2011, lower than a previous forecast for shipments to grow 6 percent to 7 percent, the trade promotion agency said in a separate statement today.

Fanuc declined 2.1 percent to 12,180 yen. Japan’s export shipments dropped 3.7 percent in October from a year earlier, the Ministry of Finance said today in Tokyo. The median estimate of 29 economists surveyed by Bloomberg News was for a 0.3 percent decline.

Osaka Securities Exchange Co. climbed 1.8 percent to 421,000 yen. The company and the Tokyo Stock Exchange, the nation’s two largest bourses, agreed to merge and are set to announce the deal tomorrow, the Nikkei newspaper reported.

Olympus Corp. (7733) rose by its daily limit, gaining 16 percent to 725 yen. Nippon Life Insurance Co., Japan’s biggest life insurer and a shareholder in Olympus, will continue to support the optics maker after it admitted hiding losses, said Nippon Life President Yoshinobu Tsutsui.

Elpida tumbled 7.3 percent to 319 yen. Advantest Corp., the world’s biggest maker of memory-chip testers, lost 4.5 percent to 810 yen. Japan’s October chip-equipment orders declined 33 percent from a year ago to 81.2 billion yen ($1 billion), according to a Nov. 18 statement from the Semiconductor Equipment Association of Japan.

To contact the reporters on this story: Lynn Thomasson in Hong Kong at lthomasson@bloomberg.net; Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net

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