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Asian stocks fell to a two-month low led by banking shares and developers after Australia’s business confidence deteriorated and on a report China may expand a property tax trial.
Westpac Banking Corp. dropped 2.2 percent in Sydney. QBE Insurance Group Ltd. (QBE) sank 7.5 percent as analysts cut ratings for Australia’s biggest insurer after it lowered its profit forecast. Shimao Property Holdings Ltd. (813) fell 2.3 percent to lead Chinese developers lower in Hong Kong. Petrochina Co. slid 1.2 percent as oil prices declined.
The MSCI Asia Pacific Index (MXAP) slipped 0.6 percent to 120.12 as of 3:11 p.m. in Tokyo. The gauge has fallen about 2 percent this quarter as companies from Honda Motor Co. to QBE cut forecasts even as data showed China’s economic slump may be bottoming.
“Markets are priced in for very low growth and there’s still quite a lot of pessimism around,” said Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd., which manages almost $100 billion. “You see the lack of conviction and skepticism in low volumes. This shows investors' worry, anxiety and skepticism to participate in the market.”
The MSCI Asia Pacific gained 11 percent through yesterday from this year’s low on June 4 as central banks added stimulus to spur growth and data showed a slowdown in China may be ending. Markets in Malaysia and Singapore are closed today for a holiday.
The Asia-Pacific gauge traded at 13.2 times estimated earnings as of Nov. 9, compared with 13.3 for the Standard & Poor’s 500 Index and 12.1 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
Japan’s Nikkei 225 Stock Average (NKY) retreated 0.3 percent today, erasing an earlier gain of 0.5 percent as the yen strengthened. Volume was 22 percent less than the 30-day average, according to data compiled by Bloomberg.
Hong Kong’s Hang Seng Index fell 0.8 percent amid a sell- off in Chinese shares listed in the city. The Hang Seng China Enterprises Index (HSCEI) lost 1.4 percent. The gauge, Asia’s best performing major gauge this quarter through Nov. 9, has fallen 5.3 percent since entering a so-called bull market on Nov. 2 after rising more than 20 percent from its low for the year. South Korea’s Kospi slid 0.6 percent today.
Australia’s S&P/ASX 200 Index (AS51) lost 1.5 percent after a report showed the countrys’ business confidence weakened. The confidence index slipped to minus 1 from zero in September, a National Australia Bank Ltd. survey of more than 400 companies taken Oct. 18-31 and released in Sydney today showed. The business conditions gauge, a measure of hiring, sales and profits, dropped to minus 5 from minus 3.
Westpac Banking dropped 2.2 percent to A$24.80. National Australia Bank Ltd. declined 2.2 percent to $23.11, while Australia & New Zealand Banking Group Ltd. (ANZ) and Commonwealth Bank of Australia fell more than 1.1 percent.
China is “actively” studying expanding a property tax trial at an “appropriate” time, the Xinhua News Agency cited Minister of Housing and Urban-Rural Development Jiang Weixin as saying yesterday. The government won’t relax restrictions on home purchases in the short term, he said, according to the report.
Shimao Property lost 2.3 percent to HK$14.30. China Resources Land Ltd. (1109) declined 0.9 percent to HK$18.16.
Energy shares accounted for the largest drop of 10 industry groups on the Asian equity gauge amid signs supplies are rising in the U.S. and China, the world’s biggest crude consumers.
Petrochina dropped 1.2 percent to HK$10.22 and Cnooc Ltd. slipped 0.8 percent to HK$15.84.
Hitachi Metals Ltd. (5486) lost 8.2 percent to 624 yen after the Nikkei newspaper reported it may merge with electronic-equipment manufacturer Hitachi Cable Ltd., which surged 19 percent to 127 yen. The cable unit of Hitachi Ltd. hasn’t made a profit in four years.
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