Most Asian Stocks Drop as Bank of Japan Disappoints

Most Asian stocks fell after the Bank of Japan’s expansion of its asset-purchase program failed to allay concern economic growth in the world’s third-largest economy is waning. Hurricane Sandy forced U.S. markets to shut for a second day.

Toyota Motor Corp. lost 0.5 percent, reversing earlier gains, after the central bank’s announcement. BYD Co., the Chinese automaker partially owned by Warren Buffett’s Berkshire Hathaway Inc., tumbled 4.1 percent after saying profit may fall as much as 98 percent this year. Sharp Corp. (6753) surged 6.2 percent in Tokyo on a report the maker of liquid-crystal displays is in partnership talks with Apple Inc. and Google Inc.

The MSCI Asia Pacific Index (MXAP) rose less than 0.1 percent to 121.22 as of 7:46 p.m. in Tokyo after earlier gaining as much as 0.4 percent and dropping 0.2 percent. The measure climbed 4.4 percent since Sept 6. after the European Central Bank started the latest wave of economic stimulus to boost growth, with the U.S. Federal Reserve and the Bank of Japan following suit.

“Most people had forecast and priced in further easing this time,” said Soichiro Monji, chief strategist at Tokyo- based Daiwa SB Investments Ltd., which manages the equivalent of about 5 trillion yen ($63 billion). “They are selling to lock in profit upon the announcement.”

Industrial companies led declines today among the MSCI Asia Pacific Index’s 10 industry groups. Shares on the region’s benchmark equity gauge trade for an average of 12.9 times estimated earnings, compared with 13.5 for the Standard & Poor’s 500 Index and 12 for the Stoxx Europe 600 Index.

‘Minimum Expansion’

Japan’s Nikkei 225 Stock Average (NKY) fell 1 percent after the central bank expanded its asset-purchase fund by 11 trillion yen to 66 trillion yen. All but one of 27 economists surveyed by Bloomberg News expected the central bank to add to its asset- purchase program.

“The 10 trillion-yen increase was seen as a minimum expansion, and the failure to reach 15 trillion yen is very disappointing for markets,” said Yunosuke Ikeda, head of Japan foreign-exchange research at Nomura Securities Co., the nation’s biggest brokerage.

Futures on the Standard & Poor’s 500 Index dropped 0.1 percent today. Equity markets in the U.S. were shut for a second day as Hurricane Sandy, the Atlantic’s Ocean’s biggest tropical storm on record, slammed into the East Coast and threatened economic damage of as much as $20 billion.

The BSE India Sensitive Index, known as the Sensex, fell 1.1 percent. The country’s central bank cut lenders’ reserve requirements, while leaving interest rates unchanged amid inflation of almost 8 percent.

South Korea’s Kospi Index (KOSPI) added 0.4 percent, while the Shanghai Composite Index increased 0.2 percent and Hong Kong’s Hang Seng Index dropped 0.4 percent. Australia’s S&P/ASX 200 Index gained 0.2 percent.

Exporters Suffer

Japanese exporters dropped after the yen strengthened against all of its major peers following the BOJ’s policy decision. Toyota Motor retreated 0.5 percent to 3,015 yen, while Sony Corp. slid 1.3 percent to 928 yen.

In Hong Kong, BYD slid 4.1 percent to HK$15.06 after the maker of cars and batteries said net income may drop to as little as 27.7 million yuan ($4.4 million) in the year through December. A slowing economy damped demand for its solar-energy products and customers, including Nokia Oyj, ordered fewer lithium-ion batteries to power mobile devices, the company said.

Sharp advanced 6.2 percent to 172 yen. Japan’s largest maker of LCDs is in talks with Apple, Google and Microsoft Corp. to jointly develop tablet computers and supply panels to the U.S. companies, Kyodo News reported yesterday, without saying where it got the information. The 100-year-old company is struggling for survival after a record loss last year.

To contact the reporters on this story: Adam Haigh in Sydney at ahaigh1@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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