Asia Stocks Fall From Five-Year High as ICBC Declines

Photographer: Tomohiro Ohsumi/Bloomberg

Visitors look at an electronic board at the Tokyo Stock Exchange in Tokyo, Japan. Close

Visitors look at an electronic board at the Tokyo Stock Exchange in Tokyo, Japan.

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Photographer: Tomohiro Ohsumi/Bloomberg

Visitors look at an electronic board at the Tokyo Stock Exchange in Tokyo, Japan.

Asian stocks retreated from the highest level since June 2008 as Australian banks dropped and Industrial & Commercial Bank of China Ltd. fell after Goldman Sachs Group Inc. sold a $1.1 billion stake.

Westpac Banking Corp. (WBC) and Commonwealth Bank of Australia, the two biggest Australian lenders, each slid at least 1 percent as minutes from a central bank meeting highlighted concern about business conditions. ICBC, the world’s largest lender by market value, sank 2.1 percent in Hong Kong. Tokyo Electric Power Co. (9501) gained 12 percent, taking this month’s rise to 90 percent.

The MSCI Asia Pacific Index slid 0.3 percent to 143.91 as of 7:40 p.m. in Hong Kong after gaining as much as 0.1 percent. The equity gauge surged about 12 percent this year and closed yesterday at the highest level since June 2008 as U.S. economic data improved and Japanese Prime Minister Shinzo Abe took steps to counter deflation. The Bank of Japan started a two-day policy meeting today.

“Earnings, frankly, are still pretty lackluster,” Hugh Young, a money manager at Aberdeen Asset Management Asia Ltd., said on Bloomberg Television. The firm oversees $322 billion. “The economic climate is not great. Abenomics for us at the moment is a bit illusory and we are a bit skeptical of it.”

The MSCI Asia Pacific gauge traded at 14.6 times average estimated earnings compared with 15.1 for the Standard & Poor’s 500 Index and 13.5 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

South Korea’s Kospi Index (KOSPI) slid 0.1 percent. Singapore’s Straits Times Index fell 0.3 percent, and Taiwan’s Taiex Index advanced 0.1 percent.

RBA Minutes

Australia’s S&P/ASX 200 Index lost 0.6 percent. The Reserve Bank of Australia released minutes of a May 7 meeting in which it described a cut to record-low rates as “appropriate to encourage sustainable growth.” Business confidence was cited as remaining weak.

The nation’s lenders declined. Westpac fell 1 percent to A$31.48 and Commonwealth Bank sank 1.4 percent to A$72.48, retreating from a record high.

Japan’s Topix Index added 0.1 percent, closing at the highest level since August 2008. The gauge has gained the most this year among 24 developed markets tracked by Bloomberg.

Governor Haruhiko Kuroda said April 4 he would double central bank purchases of government bonds to more than 7 trillion yen ($68.4 billion) a month to achieve 2 percent inflation in two years.

Stimulus Drawdown?

Futures on the S&P 500 lost 0.1 percent after the U.S. equity gauge yesterday retreated 0.1 percent from a record high. Shares erased gains after Federal Reserve Bank of Chicago President Charles Evans said the economy has improved “quite a lot.” The question now is whether “improvements that have been made will continue and be sustained,” he said.

The Shanghai Composite added 0.2 percent and Hong Kong’s Hang Seng Index declined 0.5 percent, dragged lower by ICBC. The lender retreated 2.1 percent to HK$5.52 after Goldman Sachs sold shares at a discount, according to a person familiar with the transaction who asked not to be identified as the information is private.

Tepco, as Tokyo Electric Power is known, surged 12 percent to 815 yen. Electric Power Development Co. added 5.8 percent to 3,665 yen. The Topix Electric Power & Gas Index has surged 63 percent this year.

Solar Negotiations

GCL-Poly Energy Holdings Ltd. (3800), the world’s No. 1 maker of polysilicon used in solar panels, rose 9 percent to HK$1.93 on a report the U.S. is in talks with the European Union and China to settle a dispute over solar-energy equipment.

GS Yuasa Corp., the maker of batteries for Boeing Co.’s 787 Dreamliner, rose 17 percent to 558 yen, the biggest advance since November 2008. The shares gained after United Airlines, the only U.S. carrier that operates the aircraft, restarted flights of the plane yesterday. The 787 was grounded for more than three months after fires were linked to the batteries.

PICC Property & Casualty Co. sank 2.6 percent to HK$9.94 after China’s largest non-life insurer said it plans to raise 5.8 billion yuan ($944 million) in a share sale.

SoftBank Corp. fell 3.8 percent to 5,850 yen after takeover target Sprint Nextel Corp. said it will engage in talks with competing bidder Dish Network Corp.

To contact the reporter on this story: 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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