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Asian Stocks Fall for Second Week Before U.S. Jobs Report

Asia’s benchmark stock index fell for a second week, after swinging between gains and losses today, as data showed China’s trade surplus narrowed and investors awaited a report on U.S. payrolls.

Luk Fook Holdings (International) Ltd. (590), a jewelry retailer, slumped 11 percent in Hong Kong after its rating was cut at Credit Suisse Group AG on slowing sales momentum. Mitsubishi Materials Corp., which processes metals, dropped 1.6 percent in Tokyo as it said it will halt a plant’s operation after an explosion. Dainippon Sumitomo Pharma Co., which has the distribution rights in Japan and China for a liver-disease drug developed by Intercept Pharmaceuticals Inc., jumped 17 percent after a clinical trial proved successful.

The MSCI Asia Pacific Index slipped less than 0.1 percent to 138.95, posting a 1 percent drop for the week. A U.S. Labor Department report today is projected to show American employers added more jobs in 2013 than at any point in the past eight years. China’s export growth trailed estimates in December while import gains beat economists’ projections, government data showed today.

“A lot of weight now falls on the official non-farm payrolls reading, which is due out later today,” Stan Shamu, a Melbourne-based market strategist at IG Ltd., said by e-mail. “All this positive data continues to support the argument that perhaps the U.S. economy is ready for a rapid, measured winding back of stimulus.”

Regional Gauges

Japan’s Topix (TPX) index gained 0.1 percent. New Zealand’s NZX 50 Index rose 1 percent. Singapore’s Straits Times Index slid less than 0.1 percent and Taiwan’s Taiex index added 0.2 percent. Hong Kong’s Hang Seng Index advanced 0.3 percent and the Hang Seng China Enterprises Index of mainland shares traded in the city climbed 0.1 percent.

China’s Shanghai Composite Index slipped 0.7 percent. South Korea’s Kospi index fell 0.4 percent. Australia’s S&P/ASX 200 Index lost 0.2 percent as Rio Tinto Group and BHP Billiton Ltd., the counrty’s biggest shippers of iron-ore to China, fell at least 1.4 percent.

China’s overseas shipments rose 4.3 percent from a year earlier, the General Administration of Customs said today in Beijing. That was less than the median estimate for 5 percent growth from economists surveyed by Bloomberg News. Imports increased 8.3 percent, leaving a narrower-than-projected trade surplus of $25.64 billion.

‘Little Correlation’

“There has been very little correlation between U.S. growth and Chinese exports recently,” said Garry Evans, head of global equity strategy at HSBC Holdings Plc in Hong Kong. “It gives you some lead on where the Chinese economy is going, but I think you should not draw any conclusion that the weaker Chinese exports give you any lead on the global economic growth. I think it’s more of a specific Chinese story.”

Futures on the Standard & Poor’s 500 Index added 0.4 percent today. The measure gained less than 0.1 percent yesterday. The jobs report today may show total payrolls rose by 197,000 last month, according to a Bloomberg survey median. That would bring the total for the year to 2.27 million, the most since 2005.

Data yesterday showed applications for U.S. unemployment benefits declined by 15,000 to 330,000 in the period ended Jan. 4. The median forecast of economists surveyed by Bloomberg projected 335,000. The data can be volatile after the holidays as temporary workers are dismissed, a Labor Department spokesman said as the report was released.

The Federal Reserve announced after the December meeting that it would begin trimming monthly bond buying by $10 billion to $75 billion this month as the U.S. economy continues to improve.

Look Fook Holdings

The Asia-Pacific equities gauge traded at 13.1 times estimated earnings, compared with 15.5 for the S&P 500 and 13.8 for the Stoxx Europe 600 Index yesterday, according to data compiled by Bloomberg.

Luk Fook Holdings slumped 11 percent to HK$30.05 in Hong Kong after its rating was cut to underperform from neutral by analyst Isis Wong at Credit Suisse.

Mitsubishi Materials lost 1.6 percent to 370 yen in Japan. The company said it plans to halt operations of its Yokkaichi plant after an explosion yesterday killed five people.

Dainippon Sumitomo soared 17 percent to 1,906 yen, the most on the Nikkei 225 and its highest close since March 2001. Its New York-based partner, Intercept, said the drug to treat liver disease worked well enough for the clinical trial to be stopped.

Hanergy Solar Group Ltd., a renewable-energy company, surged 34 percent to HK$1.06 in Hong Kong. The company said it will issue 500 million new shares at 0.82 Hong Kong cents each to Guangdong Southern Baota Investment Holding for working capital and future investment. The stock resumed trading today after being suspended on Dec. 20. It last closed at 0.79 Hong Kong cents.

To contact the reporters on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net; Adam Haigh in Sydney at ahaigh1@bloomberg.net

To contact the editor responsible for this story: Sarah McDonald at smcdonald23@bloomberg.net

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