Asian Stocks Drop as China GDP Grows Less Than Estimated

Photographer: Junko Kimura/Bloomberg

A pedestrian looks at an electronic stock board outside a securities firm in Tokyo. Close

A pedestrian looks at an electronic stock board outside a securities firm in Tokyo.

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Photographer: Junko Kimura/Bloomberg

A pedestrian looks at an electronic stock board outside a securities firm in Tokyo.

Asian stocks dropped, with the regional benchmark index retreating from the highest level in 20 months, after Chinese economic growth and industrial production expanded less than economists’ estimated.

Jiangxi Copper Co., China’s largest copper producer, slid 4.9 percent in Hong Kong. Nissan Motor Co. (7201), a Japanese carmaker that gets 32 percent of sales from North America, slid 3.9 percent, pacing declines among exporters after U.S. retail sales unexpectedly fell. Mando Corp. tumbled 15 percent in Seoul as Midas International Asset Management Ltd. said it will sell its holdings after the auto-parts maker said it will bail out an unprofitable construction affiliate.

The MSCI Asia Pacific Index fell 0.7 percent to 137.22 as of 8:25 p.m. in Tokyo, with about three shares sliding for each that rose. Chinese gross domestic product expanded 7.7 percent in the first quarter, missing economists estimates, data released today showed.

“While the medium-term outlook is OK, people are having to digest the fact that some of this short-term news flow isn’t quite as good,” Angus Gluskie, managing director at Sydney- based White Funds Management, which oversees more than $350 million, said before the release of the Chinese data. “There’s no doubt China’s growth over the next five or six years is going to be at a more mature pace than it was over the last decade. We should be expecting lesser rates of growth.”

The Asia-Pacific gauge jumped 3.5 percent last week, the biggest weekly gain since September, as the yen traded near 100 per dollar and slower-than-estimated inflation in China eased concern about monetary-policy tightening. Shares on the gauge traded at 13.9 times estimated earnings compared with 14.4 for the Standard & Poor’s 500 Index and 12.6 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

China Slowdown

China’s Shanghai Composite Index (SHCOMP) dropped 1.1 percent. The nation’s first-quarter economic growth was slower than the 8 percent median growth estimate of 41 economists surveyed by Bloomberg and the 7.9 percent expansion in the previous three months, a report by the National Bureau Statistics showed.

Industrial production rose 8.9 percent in March from a year earlier, the report showed. That compared with the 10.1 percent median forecast of 37 economists and a 9.9 percent gain in the first two months of the year.

Hong Kong’s Hang Seng Index (HSI) slipped 1.4 percent, dragged lower by banks and raw-material producers. South Korea’s Kospi index slid 0.2 percent and Taiwan’s Taiex Index fell 0.7 percent. Australia’s S&P/ASX 200 Index dropped 0.9 percent and New Zealand’s NZX 50 Index added 0.4 percent, the only benchmark measure in the Asia Pacific to rise outside India.

Japan’s Nikkei 225 Stock Average fell 1.6 percent after China’s data and as the U.S. Treasury department said it would urge Japan to refrain from pursuing policies to devalue its currency. The nation’s economy has shown signs of picking up, Bank of Japan Governor Haruhiko Kuroda said today in Tokyo.

Commodities Slide

S&P 500 futures fell 0.5 percent. The gauge lost 0.3 percent on April 12 after the U.S. retail sales report and as commodities plunged and a gauge of consumer sentiment slipped.

Raw material producers and energy companies posted the biggest decline among the 10 industries in the MSCI Asia Pacific Index. (MXAP) Copper and crude oil futures retreated amid concern that demand will slide after the unexpected slowdown in China’s GDP growth.

Jiangxi Copper sank 4.9 percent to HK$15.66 in Hong Kong. BHP Billiton Ltd. (BHP), the world’s biggest mining company that gets, dropped 3.1 percent to A$32.31 in Sydney. Cnooc Ltd., China’s largest offshore oil producer, declined 3.1 percent to HK$13.74.

Gold producers tumbled as bullion extended losses after plunging into a bear market last week. Newcrest Mining Ltd., Australia’s largest gold producer, slumped 8.2 percent to A$17.92. Zijin Mining Group Co. sank 7.2 percent to HK$2.33 in Hong Kong.

Nissan, Toyota

Exporters dropped after U.S. retail sales and a gauge of consumer sentiment missed forecasts. Nissan slid 3.9 percent to 1,011 yen in Tokyo. Toyota Motor Corp., the world’s largest carmaker, fell 2.1 percent to 5,540 yen. Li & Fung Ltd. (494), a supplier of toys and clothes to retailers including Wal-Mart Stores Inc. dropped 2.3 percent to HK$10.28 in Hong Kong.

Zoomlion Heavy Industry Science and Technology Co., China’s second-biggest maker of construction equipment, slumped 8.3 percent to HK$7.61. The cranemaker is heading for the lowest close since September 2011, after forecasting first-quarter profit will fall between 60 percent and 80 percent.

Singapore Press Holdings Ltd. (SPH), the city’s biggest newspaper publisher, slipped 5.7 percent to S$4.34, heading for its biggest decline since December 2011, after second-quarter profit dropped 15 percent from a year earlier to S$71.5 million ($58 million).

Mando tumbled 15 percent to 84,600 won in Seoul, the most on the MSCI Asia Pacific Index, after saying it will bail out Halla (014790) Engineering & Construction Corp. Both companies are headed by Chairman Chung Mong Won and Halla Engineering is the biggest shareholder of Mando. Halla dropped 3.2 percent.

“We will sell off all of the company’s shares,” said Heo Pil Seok, Chief Executive Officer of Midas International Asset, which according to Bloomberg data holds more than 20,000 Mando shares. “This issue clearly invades shareholders’ profits.”

To contact the reporter on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net

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

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