Asian Stocks Retreat as U.S. Auto Vote Looms; BlueScope Drops

By Chua Kong Ho

Dec. 11 (Bloomberg) -- Asian stocks fell for the first time in a week after a $14 billion U.S. automaker bailout ran into opposition in the Congress, raising concern the recession will deepen in the world’s biggest economy.

Toyota Motor Corp., traditionally earning more than half its operating profit in North America, fell 1.7 percent and Hyundai Motor Co. dropped 1 percent as Senate Republicans yesterday voiced opposition to a rescue for General Motors Corp. and Chrysler LLC. BlueScope Steel Ltd., Australia’s largest steelmaker, plunged 23 percent after it sold new stock at a discount to the market price.

“The direction of the auto bailout has become harder to read,” Juichi Wako, a Tokyo-based strategist at Nomura Securities Co., said in an interview with Bloomberg Television. “This problem will continue to determine the bearing of the stock market.”

The MSCI Asia Pacific Index fell 0.3 percent to 86.15 as of 9:10 a.m. in Tokyo, ending a four-day, 8.6 percent advance. Nine of the 10 industry groups retreated, with about two stocks declining for each that advanced.

Japan’s Nikkei 225 Stock Average slid 1 percent to 8,576.59. Australia’s S&P/ASX 200 Index sank 1.8 percent. South Korea’s Kospi Index added 0.3 percent.

Futures on the Standard & Poor’s 500 Index slid 0.5 percent today, ahead of the imminent auto bailout vote. U.S. Republican Senator George Voinovich said there probably aren’t enough supporters in his party to pass the rescue package. GM has said that it may not survive into 2009 without immediate aid.

The S&P 500 yesterday climbed 1.2 percent, as higher energy and metal prices lifted commodity producers, overshadowing concern Congress won’t rescue the car industry.

China Exports

Pakistani equities will be removed from the MSCI Emerging Markets Index this month, after the nation imposed restrictions on selling stock, according to MSCI Inc.

Rio Tinto Group rose 6 percent after saying it will eliminate 14,000 jobs, reduce debt and slash spending. Japan Tobacco Inc. jumped 5.2 percent after the Asahi newspaper reported cigarette taxes may not increase.

The MSCI Asia Pacific Index has fallen 45 percent this year, as the credit crisis triggered by the collapse of the U.S. housing market created a global recession. Efforts by central banks and governments to alleviate the downturn have helped the gauge rebound 15 percent since Oct. 27.

China’s exports last month fell for the first time in seven years, the government said late yesterday, adding to evidence that recessions in the U.S., Europe and Japan are driving the world’s fourth-largest economy into a slump.

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