Asian Stocks Drop for Second Day as Japan Exporters Fall

Photographer: Kiyoshi Ota/Bloomberg

Pedestrians walk past the Tokyo Stock Exchange in Tokyo, Japan. Close

Pedestrians walk past the Tokyo Stock Exchange in Tokyo, Japan.

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Photographer: Kiyoshi Ota/Bloomberg

Pedestrians walk past the Tokyo Stock Exchange in Tokyo, Japan.

Asian stocks fell, sending the regional benchmark index lower for a second day, as earnings results from HTC Corp. missed estimates and Japanese exporters declined after the yen strengthened.

HTC, Asia’s second-largest smartphone maker, slipped 4 percent in Taipei. Samsung Electronics Co. the world’s largest maker of mobile phones and televisions, lost 1.3 percent in Seoul after reporting earnings. Mazda Motor Corp. (7261), which gets about 72 percent of its sales outside of Japan, sank 5 percent as the yen’s advance dimmed the outlook for overseas earnings.

The MSCI Asia Pacific Index (MXAP) slipped 0.6 percent to 130.69 as of 7:18 p.m. Tokyo time, erasing gains of as much as 0.3 percent. The regional benchmark gauge posted its seventh weekly advance last week, the longest winning streak since March last year, after the U.S. Congress approved a budget deal and manufacturing reports from China and the U.S. added to signs of a global recovery.

“We don’t expect a no-brainer, one-way climb for stocks,” said Michael Kurtz, chief global equity strategist at Nomura Holdings Inc. in Hong Kong. “Japan for its part has delivered a key step toward expectations of a major pro-reflation policy shift.”

Japan’s Nikkei 225 (NKY) Stock Average climbed 22 percent through yesterday from Nov. 14 when elections were announced, driving the gauge into a bull market as the yen fell on expectations a new government would call for more stimulus. Prime Minister Shinzo Abe, a proponent for more monetary policy easing, will have a chance to reshape the Bank of Japan early this year, when the terms of Governor Masaaki Shirakawa and his two deputies expire.

Nikkei, Kospi

The Nikkei 225 fell 0.9 percent, a second day of declines. South Korea’s Kospi Index dropped 0.7 percent, while Taiwan’s Taiex Index decreased 0.4 percent. Australia’s S&P/ASX 200 Index slid 0.6 percent. Hong Kong’s Hang Seng Index slid 0.9 percent and China’s Shanghai Composite Index retreated 0.4 percent.

The MSCI Asia Pacific Index surged 14 percent in 2012 as central banks from the U.S., Europe, Japan and China took action to spur economic growth. The Asia Pacific gauge traded at 14.1 times average estimated earnings, compared with about 13.2 times for the Standard & Poor’s 500 Index and about 11.9 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

Futures on the S&P 500 Index slipped 0.2 percent today. The benchmark U.S. equities gauge fell 0.3 percent yesterday as investors awaited the start of the corporate earnings season.

Samsung Profit

HTC declined 4 percent to NT$276.5 in Taipei. Operating income was NT$600 million ($21 million) in the fourth quarter, compared with the NT$1.11 billion average of 20 analyst estimates compiled by Bloomberg. Net income was NT$1 billion, the Taoyuan, Taiwan-based company said in a statement yesterday. That’s the lowest since 2004 and less than the NT$10.9 billion it posted a year earlier.

Samsung dropped 1.3 percent to 1.5 million won, after climbing to a record last week. The company today reported an 89 percent increase in operating profit to 8.8 trillion won ($8.3 billion) in the three months ended December, according to a preliminary earnings statement.

“Samsung has been posting profits that beat analysts’ estimates throughout last year,” Lee Jin Woo, a fund manager at Seoul-based KTB Asset Management Co., which manages about $6.6 billion, said by telephone today. “Optimism about its earnings has largely been factored in, in advance, with the stock enjoying a nice rally late last year.”

Stronger Yen

Japanese exporters declined as the yen headed for its biggest two-day advance since November. A stronger currency reduces overseas earnings of Japanese carmakers and electronics manufacturers when repatriated.

Mazda dropped 5 percent to 171 yen in Tokyo. Toyota Motor Corp. (7203), the world’s biggest carmaker, slid 2 percent to 4,100 yen. Nintendo Co., the maker of wii game consoles, fell 3.1 percent to 8,700 yen.

Aozora Bank Ltd. (8304) decreased 4 percent to 240 yen, extending yesterday’s 10 percent selloff after the Japanese lender confirmed Cerberus Capital Management LP will sell most of its holdings.

China Pacific Insurance Group Co. declined 2.6 percent to HK$30.20. Carlyle Group LP, sold its remaining stake in the insurer, raising about $796 million, according to a document obtained by Bloomberg News.

Indecent Assault

Agile Property Holdings Ltd., the Chinese developer in which JPMorgan Chase & Co. owns a stake, slumped 6.5 percent to HK$11.86, the most since February 2012. Chairman Chen Zhuo Lin was formally charged with indecent assault, the company said in statement today. His arrest is unrelated to the business of the group and will not affect operations, Agile said.

Among stocks that rose, Sharp Corp., Japan’s largest maker of liquid crystal displays, advanced 3.9 percent to 293 yen. Sales increased in each of the last four months from a year earlier, helped by recovering demand for LCD televisions, President Takashi Okuda told reporters in Osaka yesterday.

Hermes Microvision, Inc., a Taiwanese supplier of semiconductor inspection equipment, jumped 6.9 percent to 541 yen in Taipei after reporting unconsolidated sales in December increased 62.5 percent from a year earlier.

To contact the reporters on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net; Adam Haigh in Sydney at ahaigh1@bloomberg.net

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

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