Asian Stocks Fall on Renewed Recession Concern; Toshiba Plunges

By Shani Raja

Jan. 30 (Bloomberg) -- Asian stocks fell for the first time in four days, led by banks and technology companies, as a record slump in Japanese production and lower profit forecasts renewed concern that the global recession is deepening.

Mitsubishi UFJ Financial Group Inc., Japan’s biggest bank, slumped 4.7 percent as reports showed the country’s factory output slumped 9.6 percent in December and unemployment surged. Toshiba Corp., Japan’s No. 1 chipmaker, and Nintendo Co., which makes the Wii game console, tumbled more than 12 percent after reducing earnings forecasts. Rio Tinto Group, the world’s third- biggest mining company, fell 3.1 percent on lower metal prices.

The MSCI Asia Pacific Index dropped 1.9 percent to 83.10 as of 10:47 a.m. in Tokyo. The measure snapped a three-day, 5.8 percent climb that came as the U.S., Japan and Australia widened efforts to end the global financial crisis that has dragged the world’s largest economies into recession.

“Expectations for government measures have been fully priced into the market, and investor focus is returning to the deterioration of the global economy,” Soichiro Monji, chief strategist at Tokyo-based Daiwa SB Investments Ltd., which manages the equivalent of $53 billion, said in an interview with Bloomberg Television.

Five stocks declined for each that rose on the MSCI gauge, which has fallen 5.6 percent this month. The Nikkei 225 Stock Average gained 1.8 percent, while Australia’s S&P/ASX 200 Index fell 1 percent to 3,490.00.

The Standard & Poor’s 500 Index dropped 3.3 percent in New York yesterday, breaking a four-day winning streak, as reports showed new home sales fell to an all-time low and the number of Americans receiving jobless benefits surged to a record.

Record Decline

The MSCI Asia Pacific Index’s declines this year extended last year’s record 43 percent tumble. The slump has cut the average valuation of companies on the benchmark measure by 38 percent in the past year to 10 times reported profit.

Mitsubishi UFJ lost 4.7 percent to 502 yen. Mizuho Financial Group Inc., Japan’s second-largest bank, slumped 4.1 percent to 235 yen.

Japanese manufacturers cut production by 9.6 percent last month as recessions in the U.S. and Europe and a slowdown in China weakened demand for Japanese cars and electronics, the Trade Ministry said today. The drop eclipsed November’s record 8.5 percent decline.

Toshiba tumbled 16 percent to 325 yen after reversing its full-year profit outlook to a loss as the global recession damped demand for chips used in consumer electronics. Nintendo tumbled 12 percent to 28,300 yen after cutting cut its full-year net income forecast by 33 percent.

Kyocera Corp., the world’s fourth-largest solar-cell maker, dropped 5 percent to 5,920 yen. The company slashed its full- year profit target by 64 percent, citing a downturn in the global electronics market.

Rio fell 3.5 percent to A$39.29. BHP Billiton Ltd., the world’s largest mining company lost 1.7 percent to A$30.13. A measure of six metals traded in London dropped 2.2 percent, with both copper and nickel falling 3 percent.

To contact the reporter for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net.