Asia Stocks Fall As Commodity Firms Weigh

Asia shares traveled lower Monday, with commodity-related firms weighing markets that were nonetheless trading off their worst levels of the session.

Japan’s Nikkei Stock Average  lost 0.4%, while South Korea’s Kospi  fell 0.1% and Australia’s S&P/ASX 200 index declined 0.4%.

Hong Kong’s Hang Seng Index slipped 0.1%, while the Shanghai Composite Index  managed to reverse an early decline and fresh multiyear low to trade up 0.3%.

“News flow over the weekend at the margin is negative,” said Chris Weston, chief market strategist at IG Markets, citing “further rhetoric from a People’s Bank of China adviser that China’s economic slowdown may persist into 2013.” See: China central bank adviser sees no signs of rebound yet.

Investors were given further cause for unease after Japan’s prime minister warned Beijing that anti-Japanese protests in China could further hurt the Chinese economy.

The protests are related to a dispute between China and Japan over ownership of a group of islands known as the Diaoyu in Chinese and Senkaku in Japanese.

Japanese steel makers, sensitive to the outlook in China, lost ground Monday, with JFE Holdings Inc.  , down 4.4%, Kobe Steel Ltd.   falling 2.9%, and Sumitomo Metal Industries Ltd.   retreating 4.8% in Tokyo.

Metal stocks were also weaker elsewhere in the region, as South Korean steel major Posco   fell 0.9% and Korea Zinc Co.  lost 1.9%.

In Australia, metal extractor Rio Tinto Ltd.   dropped 2.2% while Aquarius Platinum Ltd. declined 2.9% as platinum futures fell. Read more on metal market action

Energy firms were also lower, as commodity futures came under broad selling pressure Monday amid some strength in the U.S. dollar, with China Petroleum & Chemical Corp.   down 1.1% and PetroChina Co.   lower by 1%. Read more on energy futures.

Foxconn International Holdings Ltd.   gave up 3% after reports of a disturbance at one of the company’s northern China plants which makes components for Apple Inc.’s  iPhone.

Around 40 people were hospitalized and some arrests made, according to a Wall Street Journal report on the incident.

Parent firm Hon Hai Precision Industry Co.   traded down 0.8% in Taipei. See: Disturbance reported at Foxconn iPhone plant.

The Japanese yen  — which along with the U.S. dollar can be seen as a relatively safe place to park cash — added to gains over the weekend, as the dollar tested the ¥78 level.

Currency-sensitive firms were broadly weaker in Japan Monday, with Canon Inc.   down 3.7% and Panasonic Corp.   lower by 3.3%.

But chip maker Renesas Electronics Corp.   remained bid-only in Tokyo hours after several reports over the weekend said the struggling firm could receive a bid from a consortium of some of Japan’s biggest manufacturers in an effort to block a takeover offer from U.S. private-equity firm KKR & Co. .

A report in the Nikkei business daily said firms to join in the bid included Panasonic and Canon, as well as Toyota Motor Corp.   , down 1.9% Monday; Honda Motor Co.  , lower by 2.1%; Nissan Motor Co.  , off 2.6%; and Fanuc Corp.   falling 1%. See: Japan’s top firms may join in Renesas bid.

Helping support the market, Japan Airlines Co.   managed to gain ground, trading up 1% after relisting on the Tokyo stock exchange last week.

Telecom and technology firms saw some follow-on buying from the end of last week, when Apple launched its new iPhone to strong demand.

KDDI Corp.   gained 3.3% in Tokyo while China Unicom Ltd.  rose another 1.1% in Hong Kong.

U.S. stocks had ended mostly lower Friday, with the major indexes closing near their session lows, as investors weighed central-bank easing measures with concerns about the health of the global economy. Read U.S. stocks tally first weekly drop in three.

Global stock markets have mostly gained strongly so far this quarter, but Capital Economics economist John Higgins said Monday that the rally “is looking tired.”

Higgins said that the possibility of renewed escalation of the euro-zone crisis and growing concerns about U.S. fiscal cliff are likely to cool investors’ appetite for riskier assets, including stocks, going forward.

Marketwatch