Most Asia Stocks Fall on U.S. Housing Data, China Economic Policy Outlook

Most Asian stocks declined as sales of previously owned homes in the U.S. trailed estimates and on speculation China’s Premier Wen Jiabao will lower the target for economic growth this year.

Datang International Power Generation Co., a mainland utility, slid 1 percent in Hong Kong. Samsung Electronics Co. (005930) dropped 3.1 percent in Seoul, leading technology stocks lower after Hewlett-Packard Co. forecast profit that missed estimates. Mazda Motor Corp. sank 6.8 percent after Japan’s least profitable major carmaker said it plans to sell as much as 162.8 billion yen ($2 billion) in new shares.

The MSCI Asia Pacific Index (MXAP) fell 0.03 point, or less than 0.1 percent to 127.77 as of 7:27 p.m. in Tokyo, with five stocks sliding for every four that rose. The gauge has rallied the past nine weeks, extending its longest streak of advances since December 2005, on signs the U.S. economy is improving, bets China will ease monetary policy and optimism Europe will contain its debt crisis.

“We’re seeing a bit of profit-taking as investors are looking for the next catalysts,” said Angus Gluskie, who oversees about $350 million as managing director at White Funds Management in Sydney. “Investors are very skeptical about whether a recovery can proceed without another hurdle jumping up again. The austerity measures running through Europe are likely to take the edge off growth.”

Japan Small Caps

Today’s decline in the Asia-Pacific gauge, which is priced in dollars, was limited as the U.S. currency fell against most major peers during the afternoon. A weaker greenback increases the value of companies in the measure whose shares are priced in other currencies. Shares on the index trade at 14.7 times estimated earnings, up from 12.6 times on Dec. 16, when the rally began.

Japan’s Nikkei 225 Stock Average (NKY) rose 0.4 percent. A gauge of smaller companies on the Tokyo bourse’s second section rose for a 28th straight day, the longest stretch of gains since 1961. NIS Group Co., a consumer lender, rose the most in the measure, advancing 50 percent to 6 yen.

South Korea’s Kospi Index dropped 1 percent and Australia’s S&P/ASX 200 Index slipped 0.2 percent.

China’s Shanghai Composite Index rose 0.3 percent. Hong Kong’s Hang Seng Index slumped 0.8 percent as property and financial stocks declined.

Futures on the Standard & Poor’s 500 Index (SPXL1) were little changed today. The gauge dropped 0.3 percent in New York yesterday as purchases of previously owned U.S. homes rose less than forecast in January, a report from the National Association of Realtors showed.

Datang, Anhui

Chinese Premier Wen Jiabao is expected to target growth of less than 8 percent for the world’s second-biggest economy in his report to the National People’s Congress on March 5, according to 8 of 15 economists surveyed by Bloomberg News. The government had an 8 percent goal from 2005 to 2011.

Datang International Power slid 1 percent to HK$2.88 in Hong Kong, while Anhui Conch Cement Co. (914), China’s biggest producer of the material, slid 2.1 percent to HK$27.40.

Lonking Holdings Ltd. (3339) slumped 12 percent to HK$3 after the maker of construction equipment said earnings probably fell in 2011 due to rising operating costs.

Of 4,902 companies in the Asia-Pacific gauge that reported earnings since Jan. 9, more than half have missed analysts’ estimates. Profit has dropped 57 percent on average, compared with a 4.7 percent gain for the companies on the S&P 500 that have reported so far, according to data compiled by Bloomberg.

Samsung Electronics slumped 3.1 percent to 1,160,000 won in Seoul today. Technology stocks fell after Hewlett-Packard yesterday forecast second-quarter profit that fell short of estimates as consumers buy fewer personal computers.

Mazda, Neptune Orient

Mazda (7261) fell 6.8 percent to 137 yen in Tokyo. The company said it plans to raise shares and take out a loan after forecasting its biggest annual loss in 11 years.

Neptune Orient Lines Ltd. (NOL), a shipping company, slumped 5.6 percent to S$1.345 in Singapore after reporting a loss of $320.4 million for the quarter ended Dec. 30. It was expected to make a loss of $123.6 million in the period based on the average of eight analysts’ estimates compiled by Bloomberg.

Among stocks that rose, OneSteel Ltd. (OST), an Australian steelmaker, surged 21 percent to A$1.15 in Sydney, its steepest gain on record. The company surged 58 percent in three days after saying it’s switching focus to iron ore from its loss- making steel unit.

To contact the reporters on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net; Kana Nishizawa in Hong Kong at knishizawa5@bloomberg.net

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

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