Most Asian Stocks Drop; Commodities Slump, Yen Extends Advance 

Asian stocks declined, led by a retreat among materials producers, as the slump in crude prices spread to copper and the yen rose a fourth day against the dollar.

BHP Billiton Ltd., the world’s largest mining company, lost 2.8 percent in Sydney to close at its lowest since 2009. Toyota Motor Corp., a Japanese carmaker that gets 75 percent of sales abroad, slipped 1.6 percent as exporters fell. China Oilfield Services Ltd. dropped 1.9 percent. Hyundai Glovis Co. plunged 9 percent in Seoul to extend a slide after the patriarch of South Korea’s Hyundai Motor Group failed to sell a stake in the logistics affiliate.

The MSCI Asia Pacific Index (MXAP) declined 0.4 percent to 137.25 as of 5:00 p.m. in Hong Kong. The yen rose 0.8 percent to 117.04 per dollar, bringing its gain since Jan. 9 to 2.2 percent. Copper sank as much as 8.7 percent to its lowest since July 2009 while U.S. benchmark crude fell a fourth day.

“Oversupply and falling demand are dragging down commodities beyond oil,” said Ayako Sera, market strategist at Sumitomo Mitsui Trust Bank Ltd. in Tokyo, which oversees $325 billion. “As an investor it’s hard to proactively take on risk at the moment.”

The 55 percent plunge in oil prices since June is spreading to the metals market, dragging a Bloomberg gauge of commodity prices to the lowest level in 12 years. The relative strength index, a measure of price momentum, for copper traded in London dropped to 12, the lowest since at least 1986. The World Bank cut its global growth outlook to 3 percent for 2015, citing weak expansions in Europe and China, the world’s biggest consumer of raw materials.

Australia’s S&P/ASX 200 Index (AS51) lost 0.9 percent as it slid a third day. Japan’s Topix index sank 1.2 percent. Hong Kong’s Hang Seng Index and the Shanghai Composite both declined 0.4 percent. New Zealand’s NZX 50 Index gained 0.2 percent to a third straight record close.

U.S. Stocks

Futures on the Standard & Poor’s 500 Index slipped 0.6 percent today. U.S. stocks swung yesterday as earnings season began, with analysts cutting profit estimates for companies on the gauge given the slump in oil. The equity gauge ended the day down 0.3 percent after rising as much as 1.4 percent and dropping 1 percent. The Chicago Board Options Exchange Volatility Index, which tracks expectations of U.S. stock swings, climbed 4.9 percent.

The U.S. reports on retail sales today, while an update on euro-area industrial output is due amid prospects policy makers will bolster stimulus.

 

Source: Bloomberg – Most Asian Stocks Drop; Commodities Slump, Yen Extends Advance

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