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Asian stocks fell, dragging the MSCI Asia Pacific Index to a nine-month low, af

ter U.S. jobless claims rose and concern grew European leaders will fail to cont
ain the spread of the region’s debt crisis.
Honda Motor Co., which gets about 81 percent of its sales from overseas, decline
d 4.1 percent in Tokyo as an index of U.S. leading economic indicators unexpecte
dly declined. BHP Billiton Ltd., the world’s largest mining company, sank 2.4 pe
rcent in Sydney after oil and copper prices fell. Sonic Healthcare Ltd., which p
rovides medical tests, tumbled 20 percent in Sydney after saying earnings will b
e less than forecast.
The MSCI Asia Pacific Index slumped 1.9 percent to 111.33 as of 11:04 a.m. in To
kyo, the lowest level since Aug. 21. The gauge has tumbled 14 percent from its h
igh this year on April 15 on concern Europe’s mounting government deficits will
derail the economic recovery. Germany this week introduced a ban on naked short
selling to calm the region’s financial markets.
“A combination of events has made investors reassess the outlook for the global
economy,” said Stephen Halmarick, Sydney-based head of investment-markets resear
ch at Colonial First State Global Asset Management, which holds about $138 billi
on. “There’s clearly been a major reduction in risk appetite globally and it’s d
ifficult to see the situation stabilizing in the near term.”
Japan’s Nikkei 225 Stock Average dropped 2.5 percent and Australia’s S&P/ASX 200
Index fell 2.1 percent. Taiwan’s Taiex decreased 2.6 percent. Stock markets in
South Korea and Hong Kong are closed today for holidays.
Singapore Correction
Singapore’s Straits Times Index slumped 2.2 percent, taking its tumble from this
year’s high on April 14 to 11 percent. A drop of 10 percent is the level some a
nalysts refer to as a correction.
Futures on the Standard & Poor’s 500 Index lost 0.5 percent. The index plunged 3
.9 percent yesterday as the leading indicators and jobless claims reports raised
concern about the strength of growth in the world’s largest economy.
The Stoxx Europe 600 Index slumped 2.2 percent yesterday, as uncoordinated attem
pts by policy makers to resolve the region’s debt crisis unnerved investors. Fra
nce, the Netherlands and Finland said they have no plans to follow German Chance
llor Angela Merkel’s effort to control what she called “destructive” markets by
restricting short selling.
Honda declined 4.1 percent to 2,776 yen in Tokyo. Toyota Motor Corp., the world’
s largest automaker, slid 2.5 percent to 3,335 yen and was the biggest drag on t
he MSCI Asia Pacific Index. Canon Inc., a camera maker that counts Europe as its
biggest market by revenue, dropped 2.9 percent to 3,715 yen.
Rio Tinto, Noble
Commodity companies declined after oil and metal prices fell. BHP Billiton slump
ed 2.4 percent to A$35.85 in Sydney. Rio Tinto Group, the world’s third-largest
mining company, tumbled 4 percent to A$59.78.
Woodside Petroleum Ltd., Australia’s No. 2 oil and gas producer, declined 3.2 pe
rcent to A$40.25. Noble Group Ltd., the commodities supplier partly owned by Chi
na Investment Corp., sank 5.9 percent to S$1.60 in Singapore.
Crude oil for June delivery dropped 1.5 percent in New York, extending yesterday
’s 2.3 percent slump as doubts about the strength of the economic recovery promp
ted investors to sell commodities. Copper futures in London lost as much as 1.3
percent earlier today.
The MSCI Asia Pacific Index’s slump since April erased its 2010 advance, leaving
it down 7.6 percent for the year. Companies in the measure trade at an average
14 times estimated earnings, the lowest level since January 2009.
“Investors appear to have thrown in the towel,” said Prasad Patkar, who helps ma
nage about $1.7 billion in Sydney at Platypus Asset Management Ltd. “This does f
eel like capitulation. Still, the base case is that macro worries will settle do
wn and investors will be able to refocus on fundamentals.”
Sonic Healthcare plunged 20 percent to A$10.16 in Sydney, the biggest decline in
the MSCI Asia Pacific Index. The company said earnings will be less than foreca
st after the Australian government cut subsidies on medical tests. JPMorgan Chas
e & Co. and Morgan Stanley cut their recommendations on the stock.