Most Asian stocks fell, led by banks and material companies, amid mounting concern budget deficits in Europe will derail the global economic recovery.
Macquarie Group, Australia's largest investment bank, slumped 6.2 per cent after its second-half profit forecast disappointed some investors. Westpac dropped 2.5 per cent as the cost of protecting Australian government bonds from default jumped. Mitsubishi Materials Corp, Japan's No. 3 copper producer, sank 2.6 per cent as it swung to a nine-month net loss. Toshiba fell 2.6 per cent after Nikkei English News reported the company and its partners lost a bid in Vietnam.
About five stocks declined for every three that rose on the MSCI Asia Pacific Index, which fell 0.2 per cent to 113.94 as of 11:16 a.m. in Tokyo. The gauge has fallen 10 per cent from a 17-month high on Jan. 15 on speculation central banks will tighten monetary policy, and that Greece, Spain and Portugal will struggle curbing deficits.
``Investors remain cautious as the correction continues,'' said Tim Schroeders, who helps manage $US1.1 billion at Pengana Capital in Melbourne. ``Markets are climbing the wall of worry and are yet to be fully convinced that a workable solution is in the offing regarding highly-indebted European countries such as Greece and Spain.''
Japan's Nikkei 225 Stock Average lost 0.4 per cent, while South Korea's Kospi index added 0.6 per cent. Australia's S&P/ASX 200 Index declined 0.8 per cent. Hong Kong's Hang Seng Index gained 0.4 per cent.
Government bonds
Futures on the US Standard & Poor's 500 Index added 0.1 per cent. Europe concerns dragged the gauge down by 0.9 per cent yesterday. Credit-default swaps, or the cost of insuring against losses on sovereign debt, on Spain and Portugal jumped to a record, according to CMA DataVision. Those for Greece also hovered near an all-time high.
Macquarie slipped 6.2 per cent to $47.21. The company said net income in the six months to March 31 may climb 10 per cent from the first half. That indicates second-half profit of $526.9 million, below the $586 million average estimate of three analysts surveyed by Bloomberg.
Today's forecast is ``slightly below the more bullish analysts,'' said Angus Gluskie, who oversees $US300 million at White Funds Management in Sydney. ``Some investors were looking for a greater upgrade, so on a short-term basis are happy to close out positions given the softness in the market.''
Sales slump
Westpac Banking, Australia's second-largest lender by market value, sank 2.5 per cent to $22.68. Commonwealth Bank, the largest, lost 1.7 per cent to $51.85. The cost of protecting Australian government bonds from default jumped to almost a nine-month high today, according to Deutsche Bank.
Mitsubishi Materials slumped 2.6 per cent to 223 yen. The company said it swung to a nine-month net loss of 31.7 billion yen from net income of 19.6 billion yen a year earlier, as sales dropped by a third.
Toshiba fell 2.6 per cent to 412 yen. Toshiba, Mitsubishi Heavy Industries, and Hitachi, which together bid for a nuclear plant project in Vietnam, lost the order to Russia's state-run Rosatom, Nikkei English News reported, citing sources it didn't identify. Hitachi and Mitsubishi Heavy Industries both dropped at least 1 per cent.
Koito Industries, which makes seats for trains and airplanes, plunged 34 per cent to 159 yen. The company will fix about 150,000 passenger seats in some 1,000 commercial airliners after saying that it falsified test results and made unauthorized design changes.
Among stocks that rose today, Sumitomo Mitsui Financial Group, Japan's No. 2 bank by value, increased 1.8 per cent to 2,825 yen after profit beat analyst estimates. NCSoft, an on-line games developer, advanced 2.1 per cent to 123,000 won in Seoul as it reported increased quarterly profit.
In Sydney, David Jones, Australia's second-biggest department store chain, advanced 1.3 per cent to $4.67. David Jones raised its earnings forecast after posting 2.4 per cent sales growth for the second-quarter.
Cochlear, maker of the world's best-selling hearing implant, climbed 4.4 per cent to $64.08 after first-half profit rose 8 per cent on new product sales.
