By Shani Raja
Sept. 24 (Bloomberg) -- Most Asian stock markets fell, led by commodity and finance companies, as raw-material prices declined and Aiful Corp. forecast a full-year loss. Japan stocks rose as brokerages upgraded Toshiba Corp. and Fast Retailing Co.
Jiangxi Copper Co., China’s biggest producer of the metal, lost 3.6 percent in Hong Kong. Aiful, Japan’s second-largest consumer lender by assets, tumbled 24 percent. Toshiba, Japan’s biggest chipmaker, added 3.8 percent after Credit Suisse Group AG more than doubled its price estimate. Fast Retailing, the operator of the nation’s biggest casual clothing chain, jumped 5.3 percent after Goldman Sachs Group Inc. recommended the stock.
Stocks that fell about matched those that that rose on the MSCI Asia Pacific Index, which added 0.3 percent to 119.08 as of 6:39 p.m. in Tokyo. Japan resumed trading after a three-day holiday, during which the MSCI gauge rose 0.3 percent. The measure surged 42 percent in the past six months as stimulus measures around the world dragged economies out of recession.
“The consensus view now is that the worst is over,” said Tim Schroeders, who helps manage about $1 billion at Pengana Capital Ltd. in Melbourne. “We need further evidence that the underlying economy is more self-sustaining and less reliant on stimulus in order to justify higher prices from here.”
Hong Kong’s Hang Seng Index slumped 2.5 percent as Metallurgical Corporation of China Ltd. sank 11 percent on its first day of trading. China’s Shanghai Composite Index gained 0.4 percent. Japan, India, Pakistan, and Indonesia also fell, while all other markets rose.
Earnings Forecast
Japan’s Nikkei 225 Stock Average climbed 1.7 percent, even as a government report showed exports declined for an 11th month in August. Japan Airlines Corp. fell 16 percent ahead of a transport ministry meeting to discuss restructuring. David Jones Ltd., Australia’s second-biggest department store, sank 3.9 percent after a profit forecast disappointed some investors.
Futures on the Standard & Poor’s 500 Index lost 0.1 percent. The gauge dropped 1 percent yesterday as the Federal Reserve signaled it will use fewer tools to bolster growth.
The Fed, following a two-day policy meeting, changed the wording in the final paragraph of its statement to say it will continue to employ a “wide range of tools” to bolster the economy. In its August statement, it said it would use “all available” tools.
The MSCI Asia Pacific Index has gained 69 percent from a five-year low on March 9 on speculation improved global growth will boost corporate earnings. The advance has driven the average price of the gauge’s members to 1.6 times book value, up from 1 at the low in March.
‘Clouding The Picture’
“The markets have priced in a fair degree of good news, but discerning how strong the recovery’s going to be is still problematic,” said Pengana’s Schroeders. “Uncertainty about when the government stimulus starts to be withdrawn is clouding the picture somewhat.” Jiangxi Copper sank 3.6 percent to HK$17.60. Copper futures lost 0.3 percent in after-hours trading, following yesterday’s 2 percent drop in New York. A gauge of six metals fell 1.6 percent in London yesterday, the most this week.
BHP Billiton Ltd., the world’s biggest mining company, dropped 1.6 percent to A$37.72. The stock also fell after Andres Ramirez, president of a union representing miners at one of BHP’s copper mines in Chile, said workers will vote on a strike next week after rejecting the company’s latest pay offer.
Woodside Petroleum Ltd., Australia’s No. 2 oil and gas producer, sank 2.6 percent to A$51.71 as crude oil lost 0.5 percent in after-hours trading, adding to yesterday’s 3.9 percent slump in New York. Inpex Corp., Japan’s largest oil explorer, dropped 0.7 percent to 809,000 yen.
Aiful Job Cuts
“Resource-related shares will be inevitably affected by the drop in commodity prices,” said Mitsushige Akino, who oversees the equivalent of $656 million at Ichiyoshi Investment Management Co. in Tokyo.
Aiful sank 24 percent to 102 yen on its loss forecast and plans to cut as much as 44 percent of its workforce.
The company said last week it plans to seek a reprieve on 280 billion yen of debt repayments after failure to tap credit markets left it struggling to finance an expected increase in claims for interest refunds from its customers.
The global credit crunch, worsened by the collapse of Lehman Brothers Holdings Inc. a year ago, has caused more than $1.6 trillion of writedowns and losses at the world’s biggest financial institutions. The MSCI Asia Pacific Index slumped by a record 43 percent in 2008.
Government Supervision
The resulting economic slowdown prompted a series of stimulus packages, government bailouts and interest-rate cuts around the world to revive global growth. Leaders from the Group of 20 countries will meet in Pittsburgh on Sept. 24-25 to work on an accord to prevent a repeat of the crisis.
Japan Air, which is under government supervision following state bailouts, fell 16 percent to 144 yen. President Haruka Nishimatsu will meet today with Transport Minister Seiji Maehara to discuss the airline, Asia’s most indebted carrier. The carrier’s lenders may ask the government to split the company up, Nikkei reported earlier this week.
Toshiba climbed 3.8 percent to 496 yen. Credit Suisse raised the stock to “outperform” from “neutral” and increased its price estimate more than twofold to 640 yen. Fast Retailing rallied 5.3 percent to 11,140 yen after it was boosted to “buy” from “neutral” by Sho Kawano, a Tokyo-based analyst at Goldman Sachs.
David Jones lost 3.9 percent to A$5.44. The company reported net income of A$65.4 million ($57 million) in the six months ended July 25 and maintained its earnings growth forecast for the current year.
‘High Expectations’
“The market had very high expectations and expected that they would upgrade guidance, which they didn’t,” said Angus Gluskie, who manages about $300 million at White Funds Management Pty. in Sydney.
In Hong Kong, Metallurgical Corporation, which helped build the “Bird’s Nest” Olympic stadium in Beijing, sank 11 percent to HK$5.63 on its first day of trading. The company’s shares surged 28 percent when it debuted in Shanghai on Sept. 21.
Samsung SDI Co., the world’s second-largest maker of plasma displays, fell 4 percent to 168,500 in Seoul. Samsung Securities Co. cut the stock to “hold” from “buy,” saying the company’s shares reflected the value of its electric-car battery business.
In Wellington, Hallenstein Glasson Holdings Ltd. rose 3.7 percent to NZ$3.05 after the clothing retailer reported greater- than-forecast full-year profit.
To contact the reporter for this story: Shani Raja in Sydney at sraja4@bloomberg.net.
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