Japan Stocks Falls on U.S. Stimulus Concern, Commodities

Japanese shares slid, with the Topix Index falling the first time in four days, amid concern the U.S. Federal Reserve may scale back stimulus and China may step up tightening. Resource stocks fell after commodity prices dropped.

Inpex Corp. lost 2.8 percent to lead declines among oil producers. Fanuc Corp., which supplies robotics used in Chinese factories, declined 2.2 percent. GS Yuasa Corp., which makes batteries for Boeing Co., jumped 8 percent on optimism the planemaker is preparing fixes for battery problems that grounded the 787 Dreamliner. Nippon Telegraph & Telephone Corp. gained 0.8 percent on a report its unit will cut a fifth of its workforce.

The Topix lost 1.1 percent to 962.86 at the close of trading in Tokyo, with about two shares falling for each that gained and all but two of the gauge’s 33 industry groups declining. The Nikkei 225 Stock Average fell 1.4 percent to 11,309.13.

“Oil prices, much like other financial markets, are being hit by the negative news about a possible decline in stimulus,” said Masaru Hamasaki, chief strategist at Toyota Asset Management Co., which oversees about 1.79 trillion yen ($19 billion). “The Fed needs to discuss how it will eventually end its stimulus program, but at this stage a roll back will be taken negatively by investors,”

Futures on the Standard & Poor’s 500 Index fell 0.1 percent today. The equity gauge fell 1.2 percent in New York yesterday, the biggest drop since November, as minutes of the Federal Open Market Committee’s Jan. 29-30 meeting showed policy makers were divided about the strategy behind Chairman Ben S. Bernanke’s program of buying bonds until there is “substantial” improvement in a U.S. labor market.

Commodities Drop

West Texas Intermediate oil dropped for a second day, extending the biggest decline in three months, the London Metals Exchange Index of six industrial commodities fell for a fourth day, retreating 0.9 percent. Copper for delivery in three months lost as much as 0.8 percent to $7,900 a metric ton.

Inpex, Japan’s biggest energy explorer, fell 2.8 percent to 497,500 yen. Japan Petroleum Exploration Co. slipped 2.6 percent to 3,530 yen. Sumitomo Metal Mining Co., Japan’s second-biggest copper smelter, slumped 5.6 percent to 1,427 yen.

Stocks linked to China fell today after the nation’s State Council told local authorities to “decisively” curb real estate speculation and take steps to rein in the property market, stopping short of imposing fresh measures after prices rose the most in two years last month.

Fanuc declined 2.2 percent to 14,260 yen. Komatsu Ltd., a machinery maker which counts on China for 14 percent of its sales, dropped 4.1 percent to 2,311 yen. Daikin Industries Ltd., a maker of air conditioners which gets about 18 percent of its revenue from China, slid 2.9 percent to 3,390 yen.

GS Yuasa Jumps

Among stocks that rose, GS Yuasa jumped 8 percent to 352 yen, the biggest increase on the Nikkei 225 and its steepest advance since November 2011. Boeing officials tomorrow will present regulators with a redesign of the 787 Dreamliner’s battery that they believe will satisfy long-term safety concerns and allow the jet back into the air within weeks, people with knowledge of the proposal said.

Nippon Telegraph & Telephone, also known as NTT, increased 0.8 percent to 4,330 yen, the biggest support to the Topix Index. NTT East, a unit of the telephone operator, plans to cut 6,000 people, or 20 percent of its workforce, in five years, the Nikkan Kogyo newspaper reported.

The Topix surged 33 percent since Nov. 14, when national elections were announced, amid optimism Prime Minister Shinzo Abe and the central bank will lead the country out of deflation. The measure is trading at 1.1 times book value, compared with 2.1 for the Standard & Poor’s 500 Index and 1.5 for the Stoxx Europe 600 Index.

The Nikkei Stock Average Volatility Index slid 0.4 percent to 27.06 indicating traders expect a swing of about 7.8 percent of the benchmark gauge over the next 30 days. Volume on the measure was about 25 percent lower than its 30-day intraday average.

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