By Jonathan Burgos and Masaki Kondo
Oct. 5 (Bloomberg) -- Asian stocks fell for a third day, led by technology and mining companies, as economist Nouriel Roubini said share prices may drop and a report showed the U.S. lost more jobs than estimated.
Samsung Electronics Co., which gets 19 percent of sales from America, slumped 5.7 percent in Seoul. Mitsui & Co., which counts commodities as its biggest source of profit, lost 3.4 percent after oil and metal prices decreased. Hana Financial Group Inc. tumbled 14 percent after the Maeil Business Newspaper reported it may sell new shares.
The MSCI Asia Pacific Index declined 0.8 percent to 113.60 as of 3:56 p.m. in Tokyo, extending its three-day slump to 3.7 percent. The gauge fell 2.8 percent last week, the most since the five days ended Aug. 21, on concern a seven-month rally had outpaced the prospects for a revival in the global economy.
“The expectations of recovery that gave the market an extra boost have come apart,” said Masaru Hamasaki, a senior strategist at Toyota Asset Management Co., which oversees the equivalent of $14 billion. “Resource shares won’t rise until we see a vigorous recovery in demand.”
South Korea’s Kospi Index dropped 2.3 percent, while Singapore’s Straits Times Index lost 0.5 percent. Australia’s S&P/ASX 200 Index fell 0.3 percent. China’s markets are closed today for a holiday.
Japan’s Nikkei 225 Stock Average dropped 0.6 percent, while the Topix Index slipped 0.8 percent. Bearing maker Nachi- Fujikoshi Corp. and tool manufacturer Mori Seki Co. dropped more than 3 percent on reports of losses. Among stocks that rose, Fast Retailing Co., Japan’s biggest casual-clothing retailer, climbed 15 percent after sales at its Uniqlo chain surged.
U.S. Economy
Futures on the Standard & Poor’s 500 Index added 0.4 percent. The gauge retreated 0.5 percent on Oct. 2 after a Labor Department report showed payrolls dropped more than economists had estimated in September. Orders placed with U.S. factories fell 0.8 percent in August, the Commerce Department said, while economists had forecast orders would be unchanged.
“Markets have gone up too much, too soon, too fast,” Roubini, the New York University professor who predicted the financial crisis, said in an interview in Istanbul on Oct. 3. “I see the risk of a correction, especially when the markets now realize that the recovery is not rapid and V-shaped, but more like U-shaped. That might be in the fourth quarter or the first quarter of next year.”
The MSCI gauge has climbed 61 percent from a five-year low on March 9 as stimulus measures worldwide dragged economies out of recession. Stocks in the index are priced at an average 22 times estimated earnings, more than 17 times for companies in the S&P 500.
Group of Seven
Asian exporters fell on concern U.S. demand is faltering. Samsung Electronics, the world’s largest maker of computer- memory chips, declined 5.7 percent to 747,000 won.
Honda Motor Co., which generates 47 percent of its revenue in North America, retreated 2.8 percent to 2,595 yen. Li & Fung Ltd., the biggest supplier of clothes and toys to Wal-Mart Stores Inc. and Target Corp., declined 3.7 percent to HK$28.70.
Mitsui, Japan’s No. 2 trading house, dropped 3.4 percent to 1,086 yen. Larger rival Mitsubishi Corp., which derives almost half of its sales from commodities, declined 2.9 percent to 1,726 yen. Korea Zinc Co. slumped 7.4 percent to 163,500 won.
Crude oil slid 1.2 percent on Oct. 2, the most in a week. A gauge of six metals, including copper and nickel, fell 2 percent in London, adding to the previous day’s 2.8 percent drop.
Following the U.S. data from Oct. 2, Group of Seven finance chiefs said after a weekend meeting that “disorderly” swings in currencies threaten economic growth. Policy makers from France to Canada have signaled worry that a sliding dollar risks impeding their recoveries from the deepest global recession since World War II.
Second Slump?
Recent data spurred concern the economic recovery in the U.S. is faltering. Reports released in the past two weeks showed manufacturing, orders for goods made to last several years and sales of new homes missed estimates.
Michael Geoghegan, HSBC Holdings Plc’s chief executive officer, is convinced there will be a second global economic slump and as a result doesn’t want the bank to grow too fast, the Financial Times cited him as saying. HSBC shares lost 0.8 percent to HK$85.85 in Hong Kong.
Hana Financial, South Korea’s fourth-largest financial company, tumbled 14 percent to 35,050 won. The company may sell as much as 2 trillion won ($1.7 billion) of new shares, the Maeil Business Newspaper reported yesterday on its Web site. Hana Financial said it hasn’t decided whether to sell the stock.
Loss Forecasts
Mori Seiki declined 3.4 percent to 953 yen. The company increased its full-year loss forecast due to sluggish demand.
Nachi-Fujikoshi dropped 3.7 percent to 180 yen. The company reported a net loss of 7.25 billion yen ($81 million) for the nine months ended Aug. 31, compared with 7.14 billion yen profit a year earlier, as sales slumped.
Fast Retailing jumped 15 percent to 13,530 yen. The company said sales at Uniqlo in Japan advanced 32 percent last month, the biggest increase in 10 months, on higher demand for jeans and jackets.
Aristocrat Leisure Ltd., the world’s second largest maker of slot machines, surged 7.4 percent to A$5.55. JP Morgan Chase & Co. upgraded the stock to “overweight” from “neutral” and raised its 12-month share-price target to A$6.40 from A$4.
To contact the reporters for this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net; Masaki Kondo in Tokyo at mkondo3@bloomberg.net.
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