BHP Billiton Ltd. (BHP) sank 2.4 percent in Sydney after the world’s biggest mining company reported a drop in second-half profit amid slowing growth in emerging economies. Mobile gaming companies Gree Inc. (3632) and Dena Co. declined more than 7 percent in Tokyo as the Nikkei newspaper reported Sega Corp. is among 15 companies forming a marketing group to bypass mobile platforms. Cnooc Ltd. (883) surged 3.6 percent in Hong Kong after China’s biggest offshore oil and gas explorer posted a better-than-estimated increase in first-half profit.
The MSCI Asia Pacific Index dropped 0.7 percent to 130.62 as of 10:43 a.m. in Hong Kong, with all 10 industry groups on the gauge falling. The measure fell 3.3 percent in the past four days to the lowest closing level since July 9.
“The Fed is talking about tapering because the economy is getting better,” Mark Lister, Wellington-based head of private wealth research at Craigs Investment Partners Ltd., said by telephone. “We’re seeing some signs of life come out of the U.S. and you can’t lose sight of the fact that’s positive and encouraging. In the short-term, markets will continue to grapple with this unknown scenario.”
Japan’s Topix index fell 0.9 percent, while South Korea’s Kospi index lost 1 percent. Australia’s S&P/ASX 200 Index rose 0.3 percent and New Zealand’s NZX 50 Index advanced 0.9 percent. Singapore’s Straits Times Index slipped 0.4 percent. Hong Kong’s Hang Seng Index dropped 1.4 percent and China’s Shanghai Composite declined 0.3 percent. Taiwan’s market is closed due to a tropical storm.
The Asia-Pacific measure gained 1.7 percent this year through yesterday, lagging a 16 percent surge in the S&P 500 as growth slows in China and speculation that the Federal Reserve will curb bond buying spurred investors to sell assets across Asia and emerging markets. Investors will be watching the release of the Federal Open Market Committee’s July meeting minutes today for hints as to when the stimulus withdrawal will begin.
That left the MSCI Asia Pacific gauge trading yesterday at 12.8 times estimated earnings compared with 15 for the S&P 500 and 13.8 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
Japan’s Topix gained 31 percent this year through yesterday, the world’s best-performing developed equity market, amid optimism Prime Minister Shinzo Abe will push through reforms while the central bank provides record stimulus to spur an economic recovery.
Shares extended declines and the yen rose after Japan’s Nuclear Regulation Authority said it plans to raise the severity level of Tokyo Electric Power Co.’s leak of radioactive water from a storage tank at the Fukushima nuclear plant to level to to three from one on a seven-level scale. Tokyo Electric Power tumbled 9.1 percent to 558 yen.
Emerging market stocks were roiled this week amid concern capital outflows will accelerate. Foreign investors yesterday sold a net $359 million of Thai stocks, the third-highest amount in a decade, according to stock exchange data compiled by Bloomberg. Thailand’s SET Index slumped 2 percent yesterday, its lowest close since June 24. The Jakarta Composite Index fell 3.2 percent yesterday, extending to 20 percent a retreat from this year’s peak. It rebounded 0.7 percent today.
Emerging markets from Brazil to Indonesia have raised borrowing costs in 2013 to try to aid their currencies as the prospect of reduced U.S. monetary stimulus curbs demand for assets in developing nations.
Futures on the Standard & Poor’s 500 Index (SPX) fell 0.2 percent today. The measure rose 0.4 percent yesterday, snapping a four-day losing streak, after retailers’ results surpassed estimates.
Fletcher Building Ltd. surged 6.7 percent to NZ$8.76 in Wellington as earnings at New Zealand’s biggest construction company topped estimates.