Most Asian Stocks Decline on Yen, U.S. Retreat; Sony Tumbles

May 15, 2014 4:26 am ET

May 15 (Bloomberg) -- Most Asian stocks fell, with the regional benchmark retreating from a four-month high, as a stronger yen weighed on Japanese shares and after U.S. equity gauges dropped from records.

Sony Corp. plunged 6.1 percent in Tokyo as the electronics company unexpectedly forecast an annual loss. Shimao Property Holdings Ltd. fell 3.2 percent, pacing a retreat among mainland developers that rallied yesterday on optimism the government will support the property market. Tencent Holdings Ltd., Asia’s largest Internet company, surged 5.8 percent after it posted quarterly profit that beat analyst estimates and a stock split took effect.

The MSCI Asia Pacific Index was little changed at 140.37 as of 4:17 p.m. in Hong Kong, after yesterday closing at its highest since Jan. 13. About five shares fell for every four that fell on the gauge. Japan’s Topix index lost 0.4 percent as the yen traded at 101.92 per dollar after gaining 0.4 percent yesterday.

“U.S. sentiment and the yen continue to dictate markets here,” said Toshiyuki Kanayama, Tokyo-based senior market analyst at Monex Inc. “It was about the time for U.S. stocks to take a breather after extending record highs.”

The Japanese economy expanded an annualized 5.9 percent from the previous three months in the first quarter, beating analysts’ estimates for a 4.2 percent expansion, a report showed today. Prime Minister Shinzo Abe’s task is to navigate the aftermath of the 3 percentage point sales-tax increase from April 1 that’s expected to trigger a contraction in gross domestic product this quarter.

Regional Gauges

South Korea’s Kospi index was little changed. Australia’s S&P/ASX 200 Index gained 0.3 percent and New Zealand’s NZX 50 Index lost 0.4 percent. Taiwan’s Taiex index added 0.1 percent. Singapore’s Straits Times Index rose 0.3 percent.

Hong Kong’s Hang Seng Index advanced 0.7 percent, rising for a sixth day, the longest winning streak since January. The Hang Seng China Enterprises Index of mainland companies traded in the city slid 0.2 percent. The Shanghai Composite Index fell 1.1 percent.

Futures on the Standard & Poor’s 500 Index were little changed today. The measure declined 0.5 percent yesterday, ending a three-day rally, as investors resumed selling in small- cap and Internet shares. The Dow Jones Industrial Average lost 0.6 percent, halting five days of gains.

Federal Reserve Chair Janet Yellen will speak today after saying last week the world’s biggest economy still requires a strong dose of stimulus.

Sony Plunges

Among companies on the Asian gauge that reported quarterly results through yesterday since April 1 and for which Bloomberg had estimates, 52 percent beat profit expectations, according to data compiled by Bloomberg.

Sony slumped 6.1 percent to 1,695 yen, the steepest slide since Nov. 1. Its net loss will probably be 50 billion yen ($491 million) in the year ending March, the company said yesterday. That compares with a 57.1 billion-yen average of profit estimates compiled by Bloomberg, and a 128.4 billion-yen net loss the year earlier.

Credit Saison Co. slumped 13 percent to 1,976 yen, the biggest drop since October 2008, after its net-income forecast trailed estimates. Sumitomo Mitsui Financial Group Inc., Japan’s second-biggest lender by market value, lost 3 percent to 4,059 yen after saying it expects profit to drop 19 percent to 680 billion yen in the year ending March.

Chinese developers retreated after rallying yesterday amid optimism the government will take further steps to support the property market. The People’s Bank of China on May 13 told the nation’s biggest lenders to expedite mortgages. Industrial & Commercial Bank of China Ltd. will accelerate the approval process for home loans, according to a Xinhua report.

Chinese Developers

Shimao Property slid 3.2 percent to HK$15.34. China Overseas Land & Investment Ltd., the biggest mainland developer traded in Hong Kong, fell 1.3 percent to HK$19.58 after jumping 4.1 percent yesterday.

Neptune Orient Lines Ltd. declined 2.5 percent to 97.5 Singapore cents. Southeast Asia’s biggest container carrier posted a first-quarter net loss and Deutsche Bank AG recommended investors sell the shares.

Among shares that rose, Tencent soared 5.8 percent to HK$108.80. Net income jumped 60 percent to 6.46 billion yuan ($1.04 billion) in the three months ended March, helped by one- time gains, beating the 4.86 billion-yuan average of analysts’ estimates compiled by Bloomberg. The closing price yesterday before today’s 5-1 stock split was HK$514.

The Asia-Pacific gauge traded at 12.8 times estimated earnings as of yesterday, compared with 16 for the S&P 500 and 15.2 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.