By Shani Raja
June 4 (Bloomberg) -- Asian stocks dropped for the first time in five days, led by consumer and mining companies, after U.S. reports showed the service sector improved less than expected and more workers lost jobs.
Panasonic Corp., which gets 13 percent of its revenue in the Americas, sank 1.8 percent in Tokyo. Canon Inc., the world’s biggest camera maker, lost 0.6 percent. BHP Billiton Ltd., the world’s largest mining company, slumped 4.2 percent after oil fell the most in two weeks.
The MSCI Asia Pacific Index fell 0.7 percent to 104 as of 10:04 a.m. in Tokyo, ending a four-day, 4.6 percent advance. It had rallied 48 percent through yesterday from a five-year low on March 9 on optimism the worst of the financial crisis had passed.
“After the recent rallies, people will see this as a good day to take some profits,” said Ben Potter, a Melbourne-based analyst at IG Markets in Melbourne. “Investors still aren’t completely sure if the worst is over.”
Japan’s Nikkei 225 Stock Average fell 0.3 percent, while Australia’s S&P/ASX 200 Index sank 1.6 percent. New Zealand’s NZX 50 Index lost 0.5 percent.
In New York, the Standard & Poor’s 500 Index fell 1.4 percent, retreating from a seven-month high. The Institute for Supply Management’s index of non-manufacturing businesses, which make up almost 90 percent of the world’s biggest economy, climbed to 44 from 43.7 in April. Economists predicted the index would rise to 45. A separate report showed U.S. companies cut 532,000 workers from payrolls.
“There’s concern shares have gotten too rich, and the service report gave U.S. investors an excuse to take profit,” said Mitsushige Akino, who oversees about $632 million at Ichiyoshi Investment Management Co. in Tokyo.
The rally since March drove the average valuation of companies on MSCI’s Asian index to 1.4 times the book value of assets on May 29, an increase of 17 percent from the end of 2008.
To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net.
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