Asian stocks post biggest decline since march on global selloff2 min read . Updated: 06 Jan 2015, 07:27 PM IST
Japan's Topix index declined 2.9%, the biggest drop in three months, as the yen gained 0.4% to 119.16 per dollar to extend Monday's advance
Singapore: Asian stocks fell a second day, with the regional benchmark index posting its biggest decline in nine months, extending a global selloff as the bear market in oil deepened.
BHP Billiton Ltd., the world’s biggest miner and Australia’s top crude producer, slid 4.7% to pace losses among energy and materials shares. Toyota Motor Corp. fell 2.8% in Tokyo after the largest auto manufacturer missed US sales estimates and as the yen gained. Galaxy Entertainment Group Ltd. sank 4.3% in Hong Kong after Bank of America Corp.’s Merrill Lynch unit cut its rating on the Macau casino operator. Tencent Holdings Ltd. surged 5.7% after the shares were recommended by JPMorgan Chase & Co.
The MSCI Asia Pacific Index dropped 1.9% to 134.78 as of 8:40 pm in Hong Kong. Global equities sank the most in more than 18 months on Monday, led by energy producers as benchmark US oil fell below $50 a barrel for the first time since 2009. The prospect of Greece exiting the euro area loomed as Germany reported slower-than-forecast inflation.
“We’re going to have quite a volatile first half," Nader Naeimi, who helps manage about $125 billion as Sydney-based head of dynamic asset allocation at AMP Capital Investors, said by phone. “We had tremendous gains in the US last year and we’re likely to see a deeper correction. In Europe, weaker commodity prices are creating hints of deflation. It’s probably both a supply and demand issue as Europe’s economy continues to falter."
Futures on the Standard & Poor’s 500 Index added 0.3%. The equity gauge slumped 1.8% on Monday, capping its first four-day losing streak since 2013, as energy shares retreated.
Japan’s Topix index declined 2.9%, the biggest drop in three months, as the yen gained 0.4% to 119.16 per dollar to extend Monday’s advance. Short-selling on the Tokyo Stock Exchange reached 37.8% of total trading value today, the highest since at least October 2008, when bourse data became available.
South Korea’s Kospi index lost 1.7%. Taiwan’s Taiex index fell 2.4%. Singapore’s Straits Times Index slipped 1.4%. Australia’s S&P/ASX 200 Index sank 1.6%, while New Zealand’s NZX 50 Index fell 0.7%.
Hong Kong’s Hang Seng Index dropped 1%, while the Hang Seng China Enterprises Index retreated 1.8%. The Shanghai Composite Index gained less than 0.1% to extend a five-year high, bringing valuations to 12.7 times estimated earnings, compared with 16.3 times for S&P 500.
“Valuations in China are still cheap," Lim Say Boon, chief investment officer at DBS Group Holdings Ltd.’s private bank, said. “China is starting to stimulate the economy and we expect this to continue into 2015."
China is accelerating 300 infrastructure projects valued at ¥7 trillion ($1.1 trillion) this year, said people familiar with the matter who asked not the be identified. Policy makers are seeking to shore up growth that’s in danger of slipping below 7%.
The inflation rate in Germany, Europe’s largest economy, fell to 0.1% in December from 0.5% in November, the nation’s statistics office said on Monday. That was the lowest since October 2009 and below the median forecast of 0.2% in a Bloomberg survey of economists. A euro zone inflation reading is due tomorrow.
Greece began an election campaign that Prime Minister Antonis Samaras said may lead to an exit from the euro region should the Syriza party win. Bloomberg