Asian Stocks Drop for a Fifth Day as U.S. Confidence Declines

By Chua Kong Ho and Katherine Espina

June 25 (Bloomberg) -- Asian stocks fell for a fifth day, led by carmakers and electronics manufacturers as a drop in U.S. consumer confidence and home prices added to concern demand for exports will wane in their biggest overseas market.

Toyota Motor Corp., Japan's largest automaker, and Matsushita Electric Industrial Co. led declines after the U.S. Conference Board's confidence index tumbled to a 16-year low. BHP Billiton Ltd., the world's biggest mining company, dropped the most in two weeks after metals prices fell.

``As long as U.S. data continues to look bad, it will definitely create fear and uncertainty in Asia,'' said Nicole Sze, a Singapore-based investment analyst at Bank Julius Baer & Co., which manages $350 billion in assets worldwide.

The MSCI Asia Pacific Index dropped 1 percent to 137.22 as of 11 a.m. in Tokyo, extending a four-day, 4.1 percent decline. About five stocks fell for each two that rose today, with nine of the benchmark's 10 industry groups retreating.

The Asian benchmark has lost 13 percent this year as credit- related losses among financial institutions and a 43 percent jump in oil raised concern the global economy will slow. More than $8 trillion in global stock market value has been wiped out in 2008.

Japan's Nikkei 225 Stock Average slipped 1.5 percent to 13,644.97. Shimamura Co., an operator of clothing stores, tumbled the most in almost nine months after UBS AG cut its rating.

Australia's S&P/ASX 200 Index lost 0.7 percent as Macarthur Coal Ltd., the world's largest exporter of pulverized coal, plunged after ending takeover talks with ArcelorMittal yesterday.

Tumbling Confidence

Hong Kong's stock market will be closed this morning because of Typhoon Fensheng and may resume trading in the afternoon, the exchange said. All markets open for trading in Asia declined apart from Malaysia.

U.S. stocks retreated to a three-month low yesterday after the Conference Board's confidence index slumped more than forecast and the S&P/Case-Shiller home-price index fell the most on record. Consumer spending accounts for more than two thirds of the U.S. economy.

Toyota, which derives about half of its profit from North America, declined 1.7 percent to 5,140 yen. Matsushita Electric, the world's largest maker of consumer electronics, fell 1 percent to 2,380 yen.

BHP dropped 2.5 percent to A$44.75, while rival Rio Tinto Group retreated 1.6 percent to A$139.50. BHP said higher iron-ore prices agreed to by Rio from Chinese steelmakers are too low to cover extra shipping costs.

BHP and Toyota were the biggest contributors to the MSCI Asian index's decline.

Metals Prices

A measure of six metals traded on the London Metal Exchange dropped 1.1 percent yesterday. Zinc declined 1.4 percent, copper 0.6 percent and nickel 1.6 percent. Raw-materials producers had the biggest decline among the MSCI Asian gauge's 10 groups today.

Shimamura fell 8 percent to 6,720 yen, after UBS cut its rating on the clothing retailer to ``neutral'' from ``buy,'' citing slower spending.

Macarthur Coal tumbled 9.5 percent to A$18.77, after Chairman Keith De Lacy said yesterday no agreement with ArcelorMittal, the world's largest steelmaker, has been reached in its takeover discussions.

Woodside Petroleum Ltd. led oil and gas producers higher after oil rose to $138.75 a barrel in New York, the highest since reaching a record $139.89 on June 16. Woodside, Australia's second-largest oil and gas producer, climbed 2.1 percent to A$67.54, while rival Santos Ltd. gained 1.5 percent to A$21.73.

Energy stocks had the biggest gain among the 10 industry groups on MSCI's Asian benchmark today.

To contact the reporter for this story: Chua Kong Ho at kchua6@bloomberg.net; Katherine Espina at kespina@bloomberg.net