Asian Stocks Fall as U.S. Data Stokes Fed Exit Concern

Asian stocks fell, with the regional benchmark index heading for a third day of losses, after improving U.S. economic reports added to concern the Federal Reserve will scale back stimulus and as data painted a mixed picture about China’s manufacturing.

Nissan Motor Co. (7201), a Japanese carmaker that gets 34 percent of its sales in North America, slid 4 percent. Nomura Holdings Inc. paced losses among Japanese brokerages.Cochlear Ltd. (COH) slumped 18 percent after the Australian maker of implant systems for the hearing impaired said sales were weaker in the second half. China Foods Ltd., a maker of products including beverages, snacks and instant food, slumped 8.7 percent after saying it expects operating profit to fall.

The MSCI Asia Pacific Index fell 1.4 percent to 132.99 as of 5:13 p.m. in Tokyo. All but one of 10 industry groups dropped on the gauge, which declined 5.1 percent in May, the first monthly loss since October.

“It’s not that we’ve seen a dramatic shift in the Fed’s exit discussion, but investors are using it as an excuse to sell,” said Masahiko Ejiri, a Tokyo-based senior fund manager at Mizuho Asset Management Co., which oversees about 3.4 trillion yen ($34 billion) in assets. “Some long positions are being unwound after the market rallied so fast.”

The MSCI Asia Pacific Index retreated 6.6 percent through last week from May 20, which was the highest close since June 2008. Asia’s benchmark gauge traded at 13.2 times average estimated earnings on May 31, compared with multiples of 14.8 for the Standard & Poor’s 500 Index and 13.2 for the Europe 600 Index, according to data compiled by Bloomberg.

Japan Falls

Japan’s Topix index lost 3.4 percent, having entered a so-called correction after falling more than 10 percent from its recent high on May 22.

Hong Kong’s Hang Seng Index (HSI) dropped 0.5 percent and China’s Shanghai Composite Index fell 0.1 percent after official and private reports on China’s factory activity offered conflicting views of the economy. A manufacturing gauge released by HSBC Holdings Plc and Markit Economics today fell to 49.2 in May from 50.4 in April. The official measure, released by the government on June 1, rose to 50.8 in May from 50.6 in April. A reading below 50 signals a contraction.

“Right now, it’s not so convincing whether China’s economy on a whole is doing good,” said Linus Yip, chief strategist at First Shanghai Securities in Hong Kong.

Regional Gauges

South Korea’s Kospi index declined 0.6 percent. Australia’s S&P/ASX 200 Index dropped 0.8 percent. Singapore’s Straits Times Index slipped 0.5 percent and Taiwan’s Taiex Index lost 0.7 percent. New Zealand’s market was closed for a holiday.

Futures on the S&P 500 added less than 0.1 percent today after falling 1.4 percent on May 31. Recent data showed consumer confidence advanced in May to the highest level in almost six years and business activity rebounded. Fed Chairman Ben S. Bernanke said last month the central bank could reduce monetary stimulus if officials see signs of sustained improvement in the economy.

Exporters to the U.S. dropped. Nissan lost 4 percent to 1,070 yen in Tokyo. Sony Corp., a Japanese exporter of consumer electronics that generates 16 percent of its sales in the U.S., fell 5.4 percent to 1,938 yen. James Hardie Industries SE, a building-materials supplier that gets 70 percent of sales from the U.S., slid 2.1 percent to A$9.75 in Sydney.

Japanese Brokerages

Japanese brokerages fell the most among the Topix’s 33 industry groups, all of which dropped. Measures of real-estate companies and brokerages, which led the equity rally from November, have fallen more than 20 percent from recent highs. Nomura, the nation’s No. 1 brokerage, slumped 8.4 percent to 723 yen. Daiwa Securities Group Inc., the second-biggest, plunged 11 percent to 764 yen.

Cochlear slumped 18 percent to A$52.88 in Sydney, the biggest drop since September 2011. The medical device maker forecast profit after tax for the full year ending June 2013 in a range of A$130 million ($125 million) to A$135 million, compared with an estimated A$155.5 million in a Bloomberg survey of analysts.

China Foods plummeted 8.7 percent to HK$3.56 in Hong Kong after saying it expects a significant decrease in operating profit at its wine and kitchen food business.

 Bloomberg