Asian Stocks Swing Between Gains, Losses on BOJ, China

Asian stocks slipped, with the region’s benchmark falling for a fifth day as markets opened from a holiday, after the Bank of Japan didn’t add to monetary stimulus and China reported an unexpected trade surplus.

Sony Corp. (6758), which yesterday said it will cut 10,000 jobs, extended declines as the yen rose after the Bank of Japan’s decision to leave its stimulus measures unchanged. China Resources Land Ltd. and other mainland developers dropped after better-than-expected Chinese exports and a report yesterday that inflation accelerated gave policy makers less room to ease monetary policy. BHP Billiton Ltd. (BHP), Australia’s biggest oil producer, dropped 0.6 percent after crude prices fell.

The MSCI Asia Pacific Index fell 0.2 percent to 123.85 as of 7:45 p.m. in Tokyo on the first day this month that all Asian markets have been open. The MSCI Asia Pacific excluding Japan Index stocks slipped 0.6 percent as shares in Hong Kong and Australia fell following a four-day holiday during which the U.S. reported slower jobs growth and China’s inflation accelerated.

“Investors are still fearful that growth isn’t strong enough and if there isn’t going to be more stimulus then that’s negative,” said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., which has almost $100 billion under management. “There’s also a less healthy element and that is that markets have become hooked on stimulus.”

Slowing Rally

The regional gauge has retreated 4 percent since the start of March as China cut its economic growth target and on speculation stocks had risen too fast after the index advanced 15 percent in the first two months of the year. Stocks on the MSCI Asia Pacific Index are valued at an average of 1.4 times book value, compared with 2.3 times on the Standard & Poor’s 500 Index (SPXL1) and 1.4 for the Stoxx Europe 600 Index.

Futures on the S&P 500 added 0.3 percent today. The gauge slid 1.1 percent in New York yesterday after a report last week showed U.S. employers in March added the fewest jobs in five months.

Japan’s Nikkei 225 Stock Average (NKY) dropped 0.1 percent, reversing gains after the Bank of Japan meeting. Governor Masaaki Shirakawa and his colleagues left the central bank’s 30 trillion yen ($370 billion) asset-purchase fund and 35 trillion yen credit-lending program unchanged, in line with the forecasts of 12 of 13 economists surveyed by Bloomberg News.

‘Calling for Action’

“The market is calling for action from the BOJ,” said Hiroaki Muto, a senior economist at Sumitomo Mitsui Asset Management Co. in Tokyo, which manages about $123 billion. “The bank’s policy makers might have reached a consensus to do something at the next meeting. Political pressure is backing them into a corner and will force them to act.”

Hong Kong’s Hang Seng Index (HSI) dropped 1.2 percent, extending declines after China reported an unexpected trade surplus for March, damping speculation policy makers will cut lending curbs to spur growth. Exports rose 8.9 percent from a year earlier, more than the 7 percent gain predicted by economists.

Australia’s S&P/ASX 200 (AS51) dropped 0.6 percent, led lower by commodity producers and energy shares. South Korea’s Kospi Index slipped 0.1 percent.

Sony plunged 3.5 percent to 1,586 yen, with declines accelerating after the yen appreciated against the dollar, crimping the earnings outlook for Japanese exporters. The electronics maker’s full-year loss will widen to 520 billion yen from the 220 billion yen projected two months ago, Sony said in a statement after markets closed.

China Developers Drop

China Resources Land, a state-controlled property company, dropped 2.1 percent to HK$14, extending declines after the Chinese trade data was released. Shimao Property Holdings Ltd. (813) fell 2.7 percent to HK$9.07. Country Garden Holdings Co., which builds villas and apartments in the mainland, slipped 1.5 percent to HK$3.23.

BHP Billiton dropped 0.6 percent to A$34.25 in Sydney as oil traded near the lowest price in almost a week in New York on speculation U.S. crude stockpiles rose to the highest level for this time of year since 1990.

Woodside Petroleum Ltd. (WPL), Australia’s second-biggest oil and gas producer, dropped 1.4 percent to A$34.69. Cnooc Ltd., China’s biggest offshore oil producer by market value, slid 1.8 to HK$15.60.

“Asia markets have been soft since the end of February, not breaking down but drifting lower,” said AMP’s Oliver. “We could be in for a rougher patch.”

To contact the reporters on this story: Jason Clenfield in Tokyo at jclenfield@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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