Asian Stocks Fall First Time in Five Days as Energy Shares Drop

  • Japanese shares end two-day rally following BOJ stimulus move
  • Crude futures decline for second day while yen advances

Asian stocks dropped, with the regional benchmark index heading for its first decline in five days, as material and energy shares led losses after oil resumed its selloff amid signs China’s economy is deteriorating.

The MSCI Asia Pacific Index slid 0.7 percent to 121.81 as of 4:06 p.m. in Hong Kong. The gauge on Monday capped its longest winning streak of the year, gaining 4.1 percent in four days, as optimism grew that central banks around the world will support financial markets. Crude slid for a second day before weekly government data forecast to show U.S. crude stockpiles expanded further from a record, exacerbating a global glut.

“It’s still a volatile market,” said Rafael Palma Gil, a Manila-based trader at Rizal Commercial Banking Corp., which oversees about $1.8 billion in assets. “While central banks have become relatively more accommodating, this stance doesn’t remove the concern of a global economic slowdown, with the weakness in China.”

The Topix lost 0.7 percent at the close in Tokyo as the yen gained as much as 0.5 percent. The gauge rallied more than 5 percent over the previous two days after the Bank of Japan boosted stimulus.

Monetary Policies

Optimism over possible central bank moves has helped buoy global equities over the past two weeks. Federal Reserve Vice Chairman Stanley Fischer said on Monday that the impact of recent market turbulence on U.S. growth could factor into decision-making, helping U.S. stocks shrug off the oil slump to close little changed. Futures on the Standard & Poor’s 500 Index fell 0.4 percent on Tuesday.

Australia’s S&P/ASX 200 Index retreated 1 percent. The nation’s central bank left interest rates unchanged on Tuesday as policy makers weigh a strengthening jobs market against the impact of recent global financial turbulence in deciding whether to ease policy further.

India’s S&P BSE Sensex fluctuated as the nation’s central bank left borrowing costs unchanged before the federal budget later this month. Governor Raghuram Rajan is caught between a stock selloff that’s pushing the rupee toward a record low and an economy that’s showing mixed signs of strength.

South Korea’s Kospi index slid 1 percent. Taiwan’s Taiex lost 0.3 percent. Singapore’s Straits Times Index fell 0.6 percent. Hong Kong’s Hang Seng Index dropped 0.8 percent. New Zealand’s benchmark gauge added 0.1 percent.

Chinese stocks climbed in light trading, led by technology and industrial companies, as the central bank injected cash into the financial system before markets close for holidays next week. The Shanghai Composite Index rose 2.3 percent, paring its decline this year to 22 percent.

China Concern

“We’re in for a period of continuing caution,” Angus Gluskie, a managing director who oversees $550 million at White Funds Management in Sydney, said by phone. “It’s a period of uncertainty. China remains the biggest concern for investors. If the Chinese situation develops more adversely, it could have greater ramifications.”

Inpex Corp. slumped 4.9 percent in Tokyo, pacing declines among energy producers. Crude futures fell as much as 2.6 percent on Tuesday after slumping 6 percent on Monday. U.S. inventories probably rose by 3.75 million barrels last week, according to a Bloomberg survey before an Energy Information Administration report Wednesday.

BHP Billiton Ltd. fell 2.2 percent in Sydney after S&P cut its credit rating for the world’s biggest mining company as producers reel from slumping commodity prices. Nok Corp., a supplier of rubber products used in the electronics and automotive industries, tumbled 16 percent in Tokyo after SMBC Nikko Securities Inc. downgraded the stock.

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