Asian stocks declined for the first week in four, with the region’s benchmark index retreating from the highest level since May, on signs of slower growth in the U.S. and China and amid concern Europe’s leaders aren’t making progress in solving the region’s debt crisis.
Nissan Motor Co., a Japanese carmaker that counts North America as its biggest market, fell 3.8 percent in Tokyo after U.S jobless claims rose more than expected. Aluminum Corp. of China Ltd. fell 2.1 percent in Hong Kong after Dallas Federal Reserve economists said overstated data may have masked the severity of China’s slowdown. Makita Corp. (6586), a Japanese maker of power tools that depends on Europe for more than 40 percent of sales, slid 2.6 percent.
The MSCI Asia Pacific Index (MXAP) slid 0.4 percent to 120.28, erasing an advance for the week during the final day of trading. The gauge closed on Aug. 23 at the highest level since May 4 before a weaker than expected employment report and wilting consumer confidence dragged it lower. About five stocks fell for every three that rose through the week.
“The rally seems to have been a bit more about hope over reality,” said Stephen Halmarick, Sydney-based head of investment markets research at Colonial First State Global Asset Management, which oversees about $150 billion. “Clearly economic data has been pretty poor. The practicalities of what needs to be done to address this are huge.”
Asia’s equity benchmark climbed more than 10 percent from its lowest level this year June 4 on bets monetary authorities in the U.S., Europe and China would take action to boost slowing economic growth. Stocks on the index were valued at 12.6 times estimated earnings on average, compared with 13.7 for the Standard & Poor’s 500 Index and 11.6 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
Japan’s Nikkei 225 Stock Average lost 1 percent this week and South Korea’s Kospi slid 1.4 percent.
Australia’s S&P/ASX 200 Index retreated 0.5 percent as Reserve Bank of Australia Governor Glenn Stevens said policy makers are prepared to respond in the event the economy slows, predicting the nation’s mining investment boom has at least another year before easing.
Exporters across the region fell. Nissan slid 3.8 percent to 765 yen. Makita slid 2.6 percent to 2,933 yen. Cosco Pacific Ltd., a shipping company which operates a port terminal in Greece, declined 2.1 percent to HK$10.40. Hutchison Whampoa Ltd., which gets more than half its sales from Europe, retreated 2.5 percent to HK$68.85.
In the U.S., a report showed the number of applications for unemployment benefits climbed last week to a one-month high. Jobless claims rose for a second week to 372,000, exceeding the 365,000 median forecast of economists surveyed by Bloomberg.
German Chancellor Angela Merkel said Europe is in one of its deepest crises, while the country’s finance minister, Wolfgang Schaeuble, said allowing Greece more time to meet its debt obligations would not solve the country’s problems.
Hong Kong’s Hang Seng Index declined 1.2 percent and the Shanghai Composite Index slid 1.1 percent. China may have overstated 2012 industrial production data to conceal the economy’s weakness, Dallas Fed economists Janet Koech and Jian Wang wrote in a paper. Separately, HSBC Holdings Plc cut China’s 2012 growth forecast to 8 percent from 8.4 percent.
Energy and material companies led declines in Asia this past week.
Whitehaven Coal Ltd. tumbled 14 percent to A$3.10 after saying Australian mining magnate Nathan Tinkler scrapped his takeover proposal that valued the company at A$5.3 billion ($5.5 billion), triggering the biggest drop in its shares in almost four years.
Cnooc Ltd. (883), China’s biggest offshore oil and gas explorer, slumped 5.1 percent to HK$14.80 after posting a 19 percent decline in first-half profit that was worse than analysts estimated after a spill closed its largest local field.
Aluminum Corp. dropped 2.1 percent to HK$3.27. JX Holdings Inc., a Japanese oil refiner, slid 4.6 percent to 398 yen after a fire at a plant in Sendai and as the company ended a solar- power joint venture.
Among rising stocks, CSL Ltd. soared. The world’s second- biggest maker of blood-derived therapies posted a 13 percent jump in second-half profit, paced by higher immune-treatment sales. The shares advanced 5.9 percent to A$42.30.
China Unicom (Hong Kong) Ltd., the nation’s second-largest mobile-phone company, rose 10 percent to HK$13.10, CHECK to its highest level in more than three months in Hong Kong, after second-quarter profit beat analysts’ estimates.
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