BLBG:Asian Stocks Fall A Fourth Day As Oil Drops On U.S., China Data
Asian stocks fell for a fourth day, Chinese shares in Hong Kong headed for a bear market and U.S. futures and oil tumbled after data from the U.S. and China added to evidence of a global economic slowdown. The dollar strengthened and Australian bond yields dropped to a record low.
The MSCI Asia Pacific Index (MXAP) lost 2.3 percent as of 2:30 p.m. in Tokyo. Japan’s Topix Index slid 2.1 percent, heading for the lowest close since Dec. 1, 1983, and Hong Kong’s Hang Seng China Enterprises Index traded more than 20 percent below its peak this year. Standard & Poor’s 500 Index futures slipped 0.6 percent and oil retreated to near an eight-month low. Australian bonds climbed, with maturities of one year or longer falling to records. The dollar rose against most major currencies.
“People are more concerned about a return of their capital as opposed to a return on their capital,” said Nick Maroutsos who oversees about $2.9 billion as managing director and co- founder of Sydney-based Kapstream Capital. “The recovery is still going to continue to have fits and starts. We need something more substantial that’s going to get investors back into the market. Until we get that, we’re not going to see risk assets perform well.”
China’s non-manufacturing purchasing managers’ index fell to 55.2 in May from 56.1 in April, the National Bureau of Statistics and China Federation of Logistics and Purchasing said yesterday in Beijing. U.S. unemployment rose to 8.2 percent in May and payrolls increased less than the most-pessimistic forecast in a Bloomberg News survey of economists, Labor Department figures showed June 1. European leaders remain divided on solutions for the region’s debt crisis.
Dollar Strengthens
The greenback advanced against 13 of its 16 major peers, with the Australian dollar leading declines, down 0.6 percent to 96.47 U.S. cents. Australian three-year yields declined as much as 14 basis points to a record 1.89 percent. The one-year-rate touched 2.338 percent. Yields on Japan’s benchmark 10-year securities fell to 0.79 percent, the least since June 2003.
Sony Corp. (6758) dropped below 1,000 yen in Tokyo trading for the first time since 1980, when the Walkman was introduced in the U.S. The shares fell as much as 2.3 percent to 990 yen on the Tokyo Stock Exchange.
Australian corporate bond risk surged to the highest level since November, according to traders of credit-default swaps, with the Markit iTraxx Australia index jumping 10 basis points to 212, according to Westpac Banking Corp. The gauge of default swap contracts on 25 companies was set for the highest close since Nov. 28, and the biggest daily increase since May 16, according to data provider CMA.
Oil, Copper
“There’s a lot of psychological pressure among investors with the weak non-manufacturing data in China and global issues such as U.S. data and the euro crisis dragging on stocks,” said Tang Yonggang, an analyst at Hongyuan Securities Co. in Beijing.
Oil for July delivery lost as much as 2.1 percent to $81.50 a barrel in electronic trading on the New York Mercantile Exchange. Prices slid $3.30, or 3.8 percent, to $83.23 a barrel on June 1, the lowest close since October. Copper futures for July delivery fell 2.1 percent to $3.2480 a pound on the Comex in New York. The London Metal Exchange is closed today for a public holiday.
To contact the reporters on this story: Mariko Ishikawa in Tokyo at mishikawa9@bloomberg.net; Adam Haigh in Sydney at ahaigh1@bloomberg.net.
To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net
