SF: Asian Stocks, Oil Decline on China Manufacturing; Yen Advances
Aug. 1 (Bloomberg) -- Asian stocks fell for the first time in five days, oil and copper declined, and the yen rose after manufacturing from Australia to China disappointed investors and companies including Komatsu Ltd. cut earnings forecasts.
MSCI Asia Pacific Index lost 0.8 percent as of 10:26 a.m. in Tokyo, where the Nikkei 225 Stock Average declined 1.3 percent. Standard & Poor’s 500 Index futures slipped 0.3 percent. Oil fell a third day, dropping 0.6 percent to $87.57 a barrel, while copper slid 0.9 percent. The yen gained against all of its major counterparts. Corn and soybean futures rose at least 0.7 percent amid a U.S. drought.
China’s purchasing manager’s index missed estimates and a gauge of Australian manufacturing declined to the lowest in three years. The euro-area jobless rate reached a record high before a European Central Bank announcement tomorrow, while the U.S. Federal Reserve is expected to forego another round of large-scale asset purchases today. Komatsu yesterday followed Hitachi Construction Machinery Co. and Sany Heavy Industry Co. in lowering forecasts on slower Chinese demand.
“This quarter’s earnings have shown that Japanese exporters are badly affected by the slowdown in China, the recession in Europe and the yen’s appreciation,” said Norihiro Fujito, a Tokyo-based senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities Co. “Given that the Chinese economy hasn’t bottomed yet, next quarter’s earnings could be even worse.”
--Editors: Shelley Smith, Jim Powell
To contact the reporters on this story: Jason Clenfield in Tokyo at jclenfield@bloomberg.net; Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net
To contact the editor responsible for this story: Shelley Smith at ssmith118@bloomberg.net
