Asian Stocks Set for 4th Week of Losses; Sumitomo Mitsui Drops

By Chen Shiyin

Aug. 22 (Bloomberg) -- Asian stocks fell, driving the region's key index to its lowest since July 2006, after renewed credit-market concerns weighed on financial companies and a jump in crude oil prices sent airlines and refiners lower.

Sumitomo Mitsui Financial Group Inc. fell 2.1 percent, leading financial shares lower after Citigroup Inc. predicted more losses at U.S. banks. Korean Air Lines Co., South Korea's largest carrier, dropped 3.6 percent after oil futures jumped more than $5 in New York. GS Holdings Corp., which operates South Korea's second-largest refiner, fell 1.9 percent after Goldman Sachs Group Inc. cut its rating on the stock.

The MSCI Asia Pacific Index lost 0.3 percent to 122.55 as of 9:15 a.m. in Tokyo, set for its lowest since July 26, 2006. Almost three stocks retreated for each that gained.

The Asian benchmark index has dropped 1.9 percent this week, its fourth-straight retreat. Losses this week took the gauge's 2008 slump to 22 percent as soaring inflation assailed global economies and the world's largest financial companies posted writedowns and credit losses of more than $500 billion.

Japan's Nikkei 225 Stock Average slipped 0.7 percent to 12,662.63. Australia's S&P/ASX 200 Index climbed 0.6 percent, the only gainer among Asia's markets that are open for trading.

U.S. stocks rose yesterday after the biggest three-day advance by energy companies since 2002 overshadowed speculation credit writedowns at financial firms will increase.

Crude oil for October delivery surged 4.9 percent to $121.18, the biggest increase since June 6, as the dollar slumped and the Aug. 20 signing of a missile-shield agreement between the U.S. and Poland heightened concern Russia may disrupt the flow of oil. The Reuters/Jeffries CRB Index of 19 commodities soared 3.7 percent, heading towards its biggest weekly gain in 33 years.

To contact the reporter for this story: Chen Shiyin in Jakarta at schen37@bloomberg.net