Asian Stocks Drop, Wiping Out Most of 2009 Gains; Sony Declines

Jan. 8 (Bloomberg) -- Asian stocks fell, wiping out most of the benchmark index’s 2009 gains, as concern global economic conditions are worsening dented the outlook for profits and drove oil prices lower.

Sony Corp. lost 6.3 percent as a private report showed U.S. employers cut more jobs than estimated in December and the yen strengthened against the dollar. BHP Billiton Ltd., Australia’s No. 1 oil producer, retreated 4.6 percent in Sydney after crude fell the most in more than seven years yesterday. Macquarie Group Ltd., Australia’s biggest securities firm, slid 5.2 percent after saying “exceptionally challenging” conditions will erode profitability.

The MSCI Asia Pacific Index dropped 2.1 percent to 90.40 as of 10:11 a.m. in Tokyo, trimming its gain this year to 0.8 percent. The gauge slumped 43 percent in 2008, its worst annual loss in its 20-year history. The index has rebounded 20 percent in the past six weeks as interest rate cuts and spending packages by governments from India to Australia boosted confidence in a swift recovery of the economy.

“We’ve seen strong rallies on hopes that all the stimulus spending will start to kick in,” said Nader Naeimi, a Sydney- based senior investment strategist at AMP Capital Investors, which manages about $85 billion. “The fact that unemployment is picking up creates nervousness, and shifts the focus back onto the broader economic challenges.”

Japan’s Nikkei 225 Stock Average slumped 2.2 percent to 9,039.82, snapping a seven-day winning streak that was the longest stretch of gains in almost three years. All indexes open for trading declined.

U.S. Jobs

In the U.S., the Standard & Poor’s 500 Index fell 3 percent yesterday. Intel Corp. slumped 6.1 percent after sales in the latest quarter trailed its forecast amid weakening demand.

U.S. companies cut an estimated 693,000 jobs in December, according to ADP Employer Services, the most since the survey began in 2001. The decline was larger than the 495,000 drop estimated by economists in a Bloomberg survey.

Crude oil for February delivery plummeted 12 percent to $42.63 a barrel in New York, the steepest drop since September 2001. The Japanese currency appreciated to as much as 92.48 today from 93.96 at the close of stock trading in Tokyo yesterday.

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