Asian stocks dropped, with a gauge of Chinese shares in Hong Kong near a bear market, after at least four investment banks cut their growth forecasts on the region’s biggest economy. Japan’s Topix Index slid as the yen headed for its longest streak of gains since May.
BHP Billiton Ltd., a mining company that gets about 29 percent of sales from China, slipped 2 percent in Sydney. Toyota Motor Corp., a carmaker that counts North America as its biggest market, fell 3 percent in Tokyo. Olam International Ltd. surged 12 percent in Singapore after a unit of Temasek Holdings Pte. offered to buy the rest of the commodity trader in a deal valued at S$5.3 billion ($4.2 billion).
The MSCI Asia Pacific Index fell 1.7 percent to 134.25 as of 6:18 p.m. in Hong Kong, the lowest level in a month, for a weekly drop of 3.5 percent, its biggest such decline since May 2012. The benchmark stock gauge in Australia, which counts China as its biggest trading partner, lost 1.5 percent. Japan’s Topix index sank 3.2 percent as the yen strengthened a fifth day on haven demand.
“China’s growth is already moderating and corporate profits continue to be rather disappointing,” said Mikio Kumada, who helps oversee more than $25 billion as Hong Kong-based global strategist at LGT Capital Partners. There are “legitimate concerns about future profitability.”
Bank of America Corp., UBS AG, JPMorgan Chase & Co. and Nomura Holdings Inc. lowered forecasts for China’s 2014 economic expansion after reports yesterday showed factory output rose in January and February at the slowest pace since the global financial crisis, while retail sales grew at the slowest rate for the period since 2004.
Premier Li Keqiang told reporters yesterday that the nation’s 2014 goal of 7.5 percent economic growth is “flexible,” and some financial-product defaults may be unavoidable.
The Hang Seng China Enterprises Index of mainland companies traded in Hong Kong lost 0.3 percent. It earlier fell as much as 1.2 percent, extending its decline from a Dec. 2 peak to more than 20 percent, which some dealers consider a bear market. The Shanghai Composite Index slipped 0.7 percent.
Hong Kong’s Hang Seng Index lost 1 percent, capping its biggest weekly decline since May 2012. New Zealand’s NZX 50 Index dropped 0.6 percent. South Korea’s Kospi index fell 0.8 percent. Singapore’s Straits Times Index slid 0.3 percent.
Futures on the Standard & Poor’s 500 Index added 0.2 percent. The benchmark U.S. stock measure yesterday erased its 2014 gain, falling 1.2 percent as the China data and ongoing tension in Ukraine overshadowed reports showing improvement in the American economy.
The Black Sea region of Crimea votes on whether to leave Ukraine and rejoin Russia on March 16, with the U.S. and Germany stepping up pressure on Moscow over their support for the secession.
“Markets are coming off amid concerns over China’s economy slowing and the Ukraine situation,” Tim Radford, a strategist at Rivkin Securities in Sydney, said by phone. “I think the concerns are overdone. Markets had a pretty good run and people are taking some risk off the table.”
Raw-material producers declined amid signs slowing growth in China will crimp demand. BHP Billiton dropped 2 percent to A$35.66. Rio Tinto Group, the world’s second-biggest mining company, slid 2.5 percent to A$61.50.
Toyota dropped 3 percent to 5,551 yen in Tokyo. Honda Motor Co., which gets about 83 percent of sales from overseas, decreased 3.1 percent to 3,607 yen. Sony Corp., the maker of Bravia televisions and PlayStation game consoles, sank 4.2 percent to 1,761 yen.
Tokyo Dome Corp. slid 6.4 percent to 545 yen, the lowest since April. The baseball-stadium operator said profit will plunge 53 percent, missing estimates.
Among shares that gained, Olam climbed 12 percent to S$2.23 in Singapore. Temasek’s Breedens Investments Pte is offering S$2.23 cash per share, the Singapore-based supplier of agricultural commodities said today in a statement. That’s a 12 percent premium to Olam’s last closing price of S$1.995.