Asian Stocks Decline as Investors Weigh Greece, China Ratio CutJonathan Burgos
Asian stocks fell as investors weighed earnings and the European Central Bank tightened terms of Greece’s bailout. China shares slid after a reserve-ratio cut failed to ease concern the economic slowdown is deepening.
Cnooc Ltd. slipped 2.2 percent in Hong Kong, with energy shares leading declines after crude slumped the most in two months yesterday as U.S. supplies surged. Hitachi Ltd. tumbled 9.9 percent in Tokyo after the industrial-machinery maker’s earnings missed estimates. Sony Corp. soared 12 percent as the electronics maker reported its best quarterly operating profit in seven years. Bank of Communications Co. fell 1.5 percent in Hong Kong, erasing a 4.7 percent advance.
The MSCI Asia Pacific Index fell 0.1 percent to 141.68 as of 4:10 p.m. in Hong Kong, with about five shares declining for very four that rose. China’s Shanghai Composite Index closed 1.2 percent lower after gaining as much as 2.4 percent. The People’s Bank of China reduced banks’ reserve requirement ratio by 50 basis points, joining more global counterparts in easing monetary policy this year to prop up growth.
“After the PBOC cut RRR, investors are taking profits because because it means the economy in the mainland is slowing down,” said Linus Yip, a Hong Kong-based strategist at First Shanghai Securities Ltd. “Cutting the RRR before the Lunar New Year also means there’s no chance for big policies to come out for a while and the market may take short-term profit.”
Japan’s Topix index, South Korea’s Kospi index and Singapore’s Straits Times Index each lost 0.5 percent. Australia’s S&P/ASX 200 Index gained 0.6 percent to close at the highest since May 2008. New Zealand’s NZX 50 Index added 0.2 percent. Hong Kong’s Hang Seng Index climbed 0.4 percent. Taiwan’s Taiex index was little changed.
Shares fell after the ECB heaped pressure on Greece’s new government by restricting access to direct liquidity lines, citing concerns about the country’s commitment to existing bailout pledges.
“While we don’t foresee Greece ultimately leaving the European Union or a collapse in the currency, until this problem is resolved it might be hard for stocks to reach new highs,” Mitsushige Akino, an executive officer at Ichiyoshi Asset Management Co. in Tokyo, said by phone.
Futures on the Standard & Poor’s 500 Index were little changed. The U.S. equity benchmark index sank 0.4 percent yesterday as oil retreated, with West Texas Intermediate crude futures dropping 8.7 percent.
(An earlier version of this story was amended to correct stock index levels.)