Asian stocks declined, with the regional benchmark index retreating from a seven-week high, after a drop in China’s imports underscored headwinds to global growth from the world’s second-largest economy.
Santos Ltd. slumped 6.2 percent in Sydney, leading losses among energy producers, after crude oil plunged on Monday. Toyota Motor Corp. and Honda Motor Co. sank at least 2.5 percent in Tokyo after Jefferies Group LLC lowered its rating on the automakers’ shares. Galaxy Entertainment Group Ltd. jumped 6.1 percent in Hong Kong to the highest level since Aug. 21, pacing gains among Macau casino shares, after Credit Suisse Group AG said gaming revenue was stronger than expected this month.
The MSCI Asia Pacific Index fell 0.9 percent to 132.95 as of 2:28 p.m. in London after closing Monday at the highest since Aug. 20. The Standard & Poor’s 500 Index rose for a fourth day on Monday as speculation global central bankers will maintain stimulus, at least through the end of the year, underpins a recovery in equities. Data released Tuesday showed China’s imports plunged for the 11th consecutive month in September, reflecting a slump in commodity prices and tepid demand as the mainland shifts away from low-end manufacturing and debt-fueled investment.
“China’s weakening economy will continue to weigh on the market,” said Tim Schroeders, a portfolio manager who helps oversee about $1 billion in equities at Pengana Capital Ltd. in Melbourne. “We’ve had a fairly significant lift in equities on speculation the Fed will delay raising rates. That’s now well priced into valuations.”
Japan’s Topix index lost 0.8 percent. South Korea’s Kospi index dropped 0.1 percent and Taiwan’s Taiex was little changed. Singapore’s Straits Times Index declined 1.6 percent. Australia’s S&P/ASX 200 Index dropped 0.6 percent. Hong Kong’s Hang Seng Index slid 0.6 percent. New Zealand’s S&P/NZX 50 Index added 0.2 percent.
The Shanghai Composite Index gained 0.2 percent, after sliding as much as 1.1 percent earlier, as investors weighed the prospects of stimulus measures after imports fell more than estimated.
“As long as the data remain sluggish, the market will be anticipating growth-boosting measures from the government,” said Wu Kan, a Shanghai-based fund manager at JK Life Insurance Co., who’s adding to holdings.
E-mini futures on the S&P 500 dropped 0.6 percent after the underlying gauge added 0.1 percent on Monday.
Investors are listening for further hints on the Federal Reserve’s policy intentions. Fed Bank of Atlanta President Dennis Lockhart, speaking Monday to a group of economists in Orlando, Florida, repeated his view that he backs the first rate increase since 2006 by the end of the year. That followed similar comments at the weekend by Fed Vice Chairman Stanley Fischer. Charles Evans of the Chicago Fed reiterated his view that a later liftoff may be the best policy as inflation struggles to gain traction.
Traders are now pricing in a chance of about 39 percent that rates will be raised by December.