Asian Stocks Fall as China Exports Slide, Energy Shares Tumble

  • China's exports fall for fifth month, imports also decline
  • Oil sinks below $38 a barrel, its lowest level since 2009

China Exports Fall for a Fifth Month

Asian stocks fell after China’s exports fell for a fifth month and oil tumbled to a six-year low, weighing on energy producers and sending BHP Billiton Ltd. to its lowest in 10 years.

The MSCI Asia Pacific Index lost 1.1 percent to 130.64 as of 4 p.m. Hong Kong time, a three-week low, with energy and material companies leading declines among the measure’s 10 industry groups. The gauge is on course to drop 5.4 percent this year, capping its first back-to-back annual loss since 2002, as a 24 percent collapse in the Bloomberg Commodity Index in 2015 weighs on resource producers and Chinese economic growth weakens. American crude sank past $38 a barrel to its lowest level since 2009 after OPEC abandoned its strategy of limiting production.

Slumping resource prices “are beginning to show up in the credit risk of major, global commodity companies, and even countries,” said Norihiro Fujito, general manager of Mitsubishi UFJ Morgan Stanley Securities Co. in Tokyo. “As more people become aware of the implications, that could lead to a sudden, risk-off period. And today we’re seeing some positioning to prepare for such a scenario.”

The Hang Seng Index fell 1.3 percent and the Shanghai Composite Index slid 1.9 percent.

A larger-than-expected decline in foreign-exchange reserves intensified concern at the scope of the slowdown in the world’s second-largest economy. China’s overseas shipments dropped 6.8 percent in November in dollar terms from a year earlier, the customs administration said Tuesday. That compare with the median forecast of a 5 percent decline in a survey of economists and a 6.9 percent fall in October.

“We expect export growth to remain sluggish,” said Hong Liang, a Beijing-based economist at China International Capital Corp. It’s “necessary to ease monetary policy further.”

Inflation data on Wednesday is forecast to show producer-price deflation in China deepened in November.

Japan’s Topix index sank 1 percent as the rout in oil prices outweighed a report showing the nation’s economy avoided a recession. Revised data showed gross domestic product rose an annualized 1 percent in the third quarter, beating estimates for a 0.2 percent gain. The previous reading showed a 0.8 percent decline, which had indicated the nation slipped back into recession.

Australia Slides

Australia’s S&P/ASX 200 Index dropped 0.9 percent. BHP Billiton, the world’s largest mining company, lost 5.2 percent, closing in Sydney at the lowest since July 2005, after iron ore sank below $40 a metric ton on rising low-cost supply. Rio Tinto Group slipped 4.3 percent.

New Zealand’s S&P/NZX 50 Index retreated 0.5 percent, while South Korea’s Kospi index lost 0.7 percent. Singapore’s Straits Times Index fell 0.8 percent and Taiwan’s Taiex Index slid 1.3 percent, the most since Nov. 11.

Futures on the Standard & Poor’s 500 Index fell 0.3 percent. The underlying equity measure lost 0.7 percent on Monday, with U.S. Steel Corp. sinking 8.8 percent after Fitch downgraded the credit rating on the steel producer. Copper producer Freeport-McMoran Inc. tumbled 7.9 percent to a 13-year low as its one-year default risk surged to the highest since 2008, according to Bloomberg data.

Traders are pricing in a 78 percent chance the Federal Reserve will raise interest rates at its meeting next week.

Before it's here, it's on the Bloomberg Terminal.