June 23 (Bloomberg) -- Asian stocks fell, dragging the MSCI Asia Pacific Index to its biggest drop in two weeks, after an unexpected decline in U.S. home sales raised concern about the strength of the world's largest economy. Toyota Motor Corp., which receives 67 percent of its revenue outside Japan, slid 1.7 percent in Tokyo after the dollar and euro weakened against the yen. Nintendo Co., which counts the Americas and Europe as its biggest markets, dropped 3.6 percent. BHP Billiton Ltd., the world's No. 1 mining company, lost 1.3 percent in Sydney after oil and copper prices sank. The MSCI Asia Pacific Index fell 1.3 percent to 116.68 at 3:01 p.m. in Tokyo, the most since June 7. The measure has fallen 9.6 percent from its high this year on April 15 on speculation Chinese measures to curb property prices and Europe's debt crisis will hurt global growth. "Investors are avoiding risk because concern is emerging that the global economy will slow," said Tomomi Yamashita, a fund manager in Tokyo at Shinkin Asset Management Co., which oversees about $6 billion. "This isn't the right time to draw up an investment strategy." Japan's Nikkei 225 Stock Average fell 1.9 percent, the biggest decline among major indexes in the Asia-Pacific region. Australia's S&P/ASX 200 Index lost 1.6 percent. Hong Kong's Hang Seng Index slipped 0.4 percent while China's Shanghai Composite Index decreased 1.2 percent. Export Revenue Futures on the Standard & Poor's 500 Index rose 0.3 percent. The gauge dropped 1.6 percent yesterday, the most since June 4, after the National Association of Realtors said purchases of existing houses decreased to a 5.66 million annual rate. Sales were forecast to rise to a 6.12 million rate, according to the median forecast of economists in a Bloomberg News survey. Toyota, the world's largest automaker, fell 1.7 percent to 3,220 yen and was the second-biggest drag on the MSCI Asia Pacific Index. Nintendo, the world's No. 1 maker of portable video-game players, dropped 3.6 percent to 27,280 yen. Sony Corp., which receives 42 percent of its sales from the U.S. and Europe, declined 0.6 percent to 2,521 yen. The housing data caught some investors off guard amid recent optimism for a pick-up in global growth that has driven the MSCI Asia Pacific Index up by 7.2 percent from this year's low on May 25. A Thomson Reuters/University of Michigan index on June 11 pointed to improved sentiment among U.S. consumers. Manufacturing in the New York region grew at a faster pace in June, according to Federal Reserve data on June 15. Biggest Declines China announcing the end of its currency's peg to the dollar on June 19 also boosted sentiment. The average price of shares in the MSCI Asia Pacific Index has risen to 14.6 times estimated earnings from 13.8 times on May 18, the lowest level in almost 17 months. "The general sentiment from the U.S housing data was a bit unexpected," said Pauline Dan, Hong Kong-based chief investment officer at Samsung Investment Trust, which oversees the equivalent of $72.1 billion in assets. The U.S. recovery "is the one big uncertainty that's overshadowing market performance," she said. Japanese exporters also declined today as the stronger yen threatened to reduce the value of overseas sales when repatriated. The dollar weakened to as low as 90.37 yen today from 90.81 at yesterday's close of stock trading in Tokyo. The euro depreciated to 110.78 yen from 111.61. 'Technically Speaking' Gauges of material, technology and energy stocks in the MSCI Asia Pacific Index dropped more than 1.8 percent today, the most of 10 industry groups. The main MSCI measure lost 0.8 percent yesterday, snapping an eight-day advance that was the longest winning streak since July 2009. In trading on June 21, the index rose close to its 200-day moving average of 119.57, the first time since May 14, before falling in the last two days. "Technically speaking, that will now be the resistance level for the market and there would have to be something significant to break through that," said Andrew Sullivan, a sales trader at MainFirst Securities Hong Kong Ltd. "Eyes are on the Federal Open Market Committee meeting to see whether the sentiment there is encouraging or not, as that is obviously something that is causing a lot of weakness in the Asian markets." The Federal Reserve committee ends a policy meeting and is due to release a statement later today. Officials after the last meeting on April 28 restated their intention to keep the benchmark interest rate near zero for an "extended period." Fragile Sentiment Commodity companies declined after crude oil for August delivery in New York dropped as much as 1 percent today, extending yesterday's 1 percent decline. Copper futures for September delivery lost as much as 1.6 percent, the first decline this week. "Sentiment remains very fragile," said David Moore, a commodity strategist at Commonwealth Bank of Australia Ltd. in Sydney. "Confidence has been rattled in recent months by European fiscal issues and by data in the U.S. that's been uneven. They're factors that have left markets cautious." BHP, which receives about 40 percent of its revenue from petroleum and base metals such as copper, declined 1.3 percent to A$39.14 in Sydney. Rio Tinto Group, the world's third-largest mining company, dropped 2.2 percent to A$70.54. Mitsubishi Corp., which gets about 40 percent of sales from commodities, slid 1.5 percent to 1,990 yen in Tokyo. PetroChina Co., the country's largest oil producer, lost 1.2 percent to HK$9.05 in Hong Kong. China Real Estate Also in Hong Kong, property developers led declines after the Shanghai statistics bureau said sales for the first five months of the year in the city. China Resources Land Ltd., a state-controlled developer, declined 2.4 percent to HK$15.58. Hang Lung Properties Ltd., which got 40 percent of its fiscal 2009 revenue from China, slid 1.6 percent to HK$30.50. China Overseas Land & Investment Ltd., controlled by the Chinese construction ministry, retreated 2.3 percent to HK$15.94. Shanghai housing sales by floor area in the first five months of the year dropped 32.5 percent from a year earlier to 7.19 million square meters, the Shanghai statistics bureau said today. The Hang Seng Property Index, a gauge of real estate companies in Hong Kong, declined 0.8 percent, the most out of the four industry groups on the Hang Seng Index. --With assistance from Masaki Kondo and Satoshi Kawano in Tokyo and Ben Sharples in Melbourne. Editors: Darren Boey, Nicolas Johnson.

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