Asian Stocks Slump on Recession Concern; Macarthur Coal Falls

By Patrick Rial

Dec. 16 (Bloomberg) -- Asian stocks fell as signs of a deepening world recession raised concern profits will shrink at companies from coal producers to electronics makers.

Macarthur Coal Ltd., the world’s biggest exporter of pulverized coal, plunged 20 percent after slashing its profit forecast and announcing job cuts amid lower demand. Posco, Asia’s third-largest steelmaker, lost 2.7 percent after the Nikkei newspaper said Toyota Motor Corp. will ask for cheaper steel prices. Sony Corp. slid 3.6 percent after Credit Suisse Group reduced its rating.

The MSCI Asia Pacific Index declined 1.6 percent to 86.67 as of 10 a.m. in Tokyo. Shares in the gauge carry an estimated dividend yield of 3.8 percent, compared with 3.3 percent for the Standard & Poor’s 500 Index in the U.S.

Japan’s Nikkei 225 Stock Average dropped 1.7 percent to 8,521.14. Shares in Australia and South Korea also retreated, with New Zealand equities rising.

The collapse of the American mortgage market triggered a global recession that’s dragged the MSCI Asia gauge down 45 percent this year. Japan, the U.S. and Europe have entered the first simultaneous recession since World War II.

The S&P 500 Index declined 1.3 percent yesterday after the New York Federal Reserve’s regional manufacturing index contracted the most on record.

Macarthur fell 20 percent to A$2.79 after saying profit in the six months ending Dec. 31 may be between A$75 million ($50 million) and A$125 million. That compares with a Nov. 13 forecast of between A$150 million and A$160 million.

Toyota, the world’s second-largest automaker, will ask for a 30 percent reduction in steel sheet prices for the year starting in April, on slumping demand for cars, the Nikkei newspaper said.

Posco dropped 2.7 percent to 380,000 won.

Sony had its investment rating cut by Credit Suisse Group to “underperform” from “neutral.” The brokerage slashed its 12- month price estimate on the stock by 59 percent to 1,000 yen.

To contact the reporter for this story: Patrick Rial in Tokyo at prial@bloomberg.net;