Asian Stocks Snap Two-Day Rally on U.S Jobs Data; Canon Drops

Jan. 14 （Bloomberg） -- Asian stocks dropped, sending the regional benchmark index to its first decline in three days, as U.S. jobless claims rose more than economists estimated and mining companies fell as oil and metal prices retreated.

Canon Inc., the world's biggest maker of cameras that gets about 28 percent of sales from the Americas, lost 1.3 percent in Tokyo. Aluminum Corp. of China, the nation's No. 1 producer of the metal, fell 2.1 percent. Inpex Corp., Japan's largest energy explorer, dropped 1.1 percent. China Resources Land Ltd., a state-controlled developer, dropped 1.6 percent in Hong Kong on speculation rate increases in the world's fastest growing major economy may be imminent.

"With the market trading at a two-and-a-half year high, there will be a bit of consolidation before the new push upwards," said Prasad Patkar, who helps manage about $1.8 billion at Platypus Asset Management in Sydney. "U.S. economic growth is broadening but jobs are still a problem and will remain a problem."

The MSCI Asia Pacific Index lost 0.2 percent to 139.31 as of 3:30 p.m. in Tokyo, trimming its weekly advance to 1 percent. About two stocks dropped for each that rose in the index. The gauge yesterday increased to its highest level since June 2008 as speculation mounted Europe will step up efforts to control its debt crisis.

Japan's Nikkei 225 Stock Average slipped 0.9 percent, while China's Shanghai Composite Index decreased 1.2 percent. Australia's S&P/ASX 200 Index rose 0.1 percent. Hong Kong's Hang Seng Index gained 0.2 percent, while South Korea's Kospi index climbed 0.9 percent.

Jobless Claims

Futures on the Standard & Poor's 500 Index were little changed. The index retreated 0.2 percent yesterday, falling for the first time in three days.

The U.S. Labor Department yesterday said initial jobless claims rose by 35,000 to 445,000 last week. The median estimate in a Bloomberg News survey called for 410,000 filings. Other government reports showed the U.S. trade deficit unexpectedly shrank in November and wholesale inflation excluding food and energy matched economists' forecasts.

Canon slipped 1.3 percent to 4,185 yen. Sony Corp., the maker of Bravia televisions and PlayStation game consoles, slid 1.2 percent to 2,941 yen. HTC Corp., the Taiwanese maker of mobile phone handsets that counts America as its biggest market, declined 2 percent to NT$848.

Aluminum Corp. declined 2.1 percent to HK$7.31. Inpex lost 1.1 percent to 487,000 yen. Mitsubishi Corp., which gets about 40 percent of sales from energy and metals, slipped 1.1 percent to 2,371 yen in Tokyo. Newcrest Mining Ltd., Australia's No. 1 gold producer, fell 1.8 percent to A$38.29.

Oil, Metals

Crude oil for February delivery fell 0.5 percent to settle at $91.40 a barrel in New York yesterday, decreasing from the highest level in 27 months. The London Metal Exchange Index of prices for six industrial metals including copper and aluminum lost 0.8 percent yesterday, the first drop in three days. Gold futures for February delivery slipped 0.2 percent yesterday.

The MSCI Asia Pacific Index rose 14.3 percent last year as improving corporate earnings and U.S. stimulus measures offset concern over Europe's debt crisis and China's anti-inflation measures. That compared with gains of 12.8 percent by the S&P 500 and 8.6 percent by the Stoxx Europe 600 Index. Stocks in the Asian benchmark were valued at 14.4 times estimated earnings on average at the last close, compared with 13.5 times for the S&P 500 and 11.2 times for the Stoxx 600.

In Seoul, Posco dropped 1 percent to 476,000 won. The company said fourth-quarter net income tumbled to 525.4 billion won （$471 million） from 1.28 trillion won a year earlier. That fell short of the 634.4 billion won average of 14 analyst estimates compiled by Bloomberg. Full-year profit also missed estimates.

Property Curbs

Chinese property developers declined amid speculation the government may announce increases in interest rates and bank reserve requirements as early as today.

China Resources Land dropped 1.6 percent to HK$14.66 in Hong Kong. Agile Property Holdings Ltd., which builds villas and apartments in China's southern Guangzhou province, slipped 0.8 percent to HK$12.72.

China won't rule out introducing new price control measures if inflationary pressure in the first quarter is too great, the China Securities Journal reported, citing Zhou Wangjun, deputy director of the pricing department at the National Development and Reform Commission. The government ordered banks to set aside more reserves six times and boosted rates twice in 2010 to curb asset bubbles after record gains in lending and property prices.

Shares of property developers in Singapore also slumped after the government raised down-payment requirements for second mortgages and extended the period homeowners must hold properties to avoid a sales tax as it steps up efforts to curb speculation after prices rose to a record.

Price Controls

CapitaLand Ltd, Southeast Asia's biggest developer, dropped 3.4 percent to S$3.71. City Developments Ltd., the nation's second-biggest developer, declined 4.6 percent to S$12.16.

South Korean oil refiners dropped on speculation the government will introduce measures to reduce fuel prices as it battles accelerating inflation. The government needs to review whether oil-product prices are at a "reasonable level," President Lee Myung Bak said yesterday at a meeting with ministers.

SK Energy Co., the nation's biggest oil refiner, declined 3.1 percent to 188,500 won. GS Holdings, the parent of South Korea's No. 2 refiner, fell 2.1 percent to 69,600 won. S-Oil Corp. slipped 3 percent to 90,800 won.

Manila Electric Co., the Philippines' largest power retailer, declined 5 percent to 267.4 pesos after the government proposed cutting electricity rates.