Japanese Stock Futures Fall on Europe Crisis, U.S. Home Sales

Japanese stock futures slid on concern Europe’s debt crisis is deepening and after pending U.S. home sales fell, damping earnings prospects for the Asian nation’s exporters. Australian equities were little changed.

American depositary receipts of Sony Corp. (6758), an electronics maker that gets 38 percent of its revenue in Europe and the U.S., fell 0.6 percent from the Tokyo close. Those of Sharp Corp. (6753), the Japanese TV maker forecasting a record loss, lost 6.6 percent after two people familiar with the matter said the company is seeking investments from private equity funds and considering selling shares to the public. Shares of Aluminum Corp. of China Ltd., the nation’s largest producer of the light metal, may be active after reporting a wider second-half loss.

Futures on Japan’s Nikkei 225 Stock Average (NKY) expiring in June closed at 12,490 in Chicago yesterday, compared with 12,520 in Osaka, Japan. They were bid in the pre-market at 12,480 in Osaka, at 8:05 a.m. local time. Australia’s S&P/ASX 200 Index was little changed today. New Zealand’s NZX 50 Index fell 0.1 percent in Wellington.

“The sentiment about Europe is bad,” said Stephen Halmarick, Sydney-based head of investment markets research at Colonial First State Global Asset Management, which oversees about $150 billion. “The uncertainty created by a bank bailout in Cyprus and the inability in Italy to form a government is weighing on the markets, reminding us of that Europe is going to be a negative influence for years to come.”

U.S. Housing

Futures on the Standard & Poor’s 500 Index (SPXL1) were little changed today. The index slid 0.1 percent in New York yesterday as fewer Americans signed contracts to purchase previously owned homes in February.

European governments and the International Monetary Fund agreed Monday to lend Cyprus 10 billion euros ($13 billion) as long as the country liquidated its second-largest bank and forced losses on bank bondholders and deposits of more than 100,000 euros.

Italian 10-year government bond yields surged 21 basis points yesterday, as the nation’s political parties remained at an impasse after last month’s elections.

The MSCI Asia Pacific Index (MXAP) rose 5.2 percent this year through yesterday on improving U.S. economic data and speculation that Japan will deploy more stimulus. The Asia benchmark traded at 15.1 times estimated earnings on average, compared with 14.1 times for the S&P 500 and 12.6 times for the Stoxx Europe 600 Index.

The Bloomberg China-US Equity Index (CH55BN) of the most-traded Chinese companies in the U.S. added 0.2 percent to a two-week high of 92.88.

To contact the reporter on this story: 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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