Asia Stocks Drop Second Day as Topix Sinks; H-Shares Rise

Asian stocks fell for a second day, following the biggest three-day rout in U.S. shares in more than two months, as health-care to technology companies retreated in Japan. Chinese equities rose.

Takeda Pharmaceutical Co. lost 5.2 percent after a U.S. jury ordered the Japanese drugmaker to pay $6 billion in punitive damages over claims it hid the cancer risks of its Actos diabetes medicine to protect billions of dollars in sales. SoftBank Corp. slid 4.5 percent and Yahoo Japan Corp. fell 3.3 percent in Tokyo. Great Wall Motor Co. climbed 6.8 percent, with the automaker leading gains among mainland Chinese stocks listed in Hong Kong.

The MSCI Asia Pacific Index declined 0.1 percent to 138.41 as of 6:42 p.m. in Hong Kong after losing as much as 0.7 percent earlier today. Investors are selling technology and telecommunication stocks across the region, paring holdings in Internet companies that have led gains in global equities during the past 12 months.

“Equity valuations have peaked and markets will trade nervously going forward,” said John Vail, Tokyo-based chief global strategist at Nikko Asset Management Co., which manages about $157 billion. There is “accelerating deterioration of China’s economy and financial system and subpar U.S. and Japanese economic growth.”

The MSCI World Index of developed-market stocks reached 15.4 times estimated earnings this month, compared with its average multiple of 13.8 over the past five years, according to data compiled by Bloomberg. The MSCI Asia Pacific Index yesterday traded at 12.6 times profit compared with 15.7 on the Standard & Poor’s 500 Index, the data show.

Regional Gauges

The Asia-Pacific stock gauge last week climbed to its highest level in more than two months as U.S. data pointed to a recovery after severe winter weather slowed growth and China outlined stimulus to ward off a slowdown.

Japan’s Topix index slid 1.9 percent today as the yen rose for a third day, trading at 102.55 per dollar. The Bank of Japan maintained its monetary-base target at between 60 trillion yen and 70 trillion yen today, concluding a two-day policy meeting.

Takeda Pharmaceutical slid 5.2 percent, the biggest drop since December, to 4,572 yen. SoftBank declined 4.5 percent to 7,217 yen and Yahoo Japan retreated 3.3 percent to 469 yen.

New Zealand’s NZX 50 Index lost 0.9 percent as Xero Ltd., a developer of online accounting software, slumped 12 percent to NZ$31.50. Australia’s S&P/ASX 200 Index (AS51) slipped less than 0.1 percent with trading volume 17 percent below its average this year. South Korea’s Kospi index added 0.2 percent and Taiwan’s Taiex Index advanced 0.1 percent, while Singapore’s Straits Times Index added 0.3 percent.

China Reopens

Hong Kong’s Hang Seng Index rose 1 percent and the Hang Seng China Enterprises Index rose 1.6 percent, a fourth day of gains. Industrial & Commercial Bank of China Ltd., the nation’s largest lender, rose 2.5 percent to HK$4.90 as banks gave the biggest boost to the gauge. Great Wall jumped 6.8 percent to HK$41.70. The Shanghai Composite Index climbed 1.9 percent as mainland Chinese markets reopened following a holiday.

March trade figures are due this week for the world’s second-biggest economy after manufacturing indexes pointed to a growth slowdown.

“There’s speculation the government will introduce some measures to stabilize growth as the market expects March data to be poor,” said Wang Weijun, a strategist at Zheshang Securities Co. in Shanghai.

U.S. Futures

S&P 500 futures slipped 0.1 percent today. U.S. stocks fell yesterday, pushing the Nasdaq 100 Index to its biggest three-day retreat since 2011 as technology shares extended last week’s selloff. The drop erased the year’s gains for the S&P 500, which lost 2.4 percent in the past three days.

Alcoa Inc., the largest U.S. aluminum producer, unofficially opens the U.S. quarterly earnings season when it releases financial results today.

Australian Agricultural Co., a cattle breeder, climbed 4.5 percent to A$1.29 after Japan and Australia signed a trade deal that will lower beef tariffs.

Treasury Wine Estates Ltd. advanced 7.2 percent to A$3.87 in Sydney after saying it’s considering selling U.S. winery and packaging plants.

To contact the reporter on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net

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

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