Asian Stocks Retreat on Energy; Thailand Declines on Martial Law

May 20, 2014 6:00 am ET

May 20 (Bloomberg) -- Asian stocks fell as energy shares led declines. Thailand’s stock index posted its biggest loss in almost two weeks as the army imposed martial law.

Coal India Ltd., a state-run producer, dropped 5.1 percent, leading losses among energy stocks. AAC Technologies Holdings Inc., which supplies speakers to Apple Inc., slid 1.4 percent in Hong Kong after Bank of America Corp. cut its rating on the stock. Yahoo Japan Corp. soared 12 percent after the Internet portal operator scrapped plans to acquire eAccess Ltd.

The MSCI Asia Pacific Index fell 0.2 percent to 139.1 as of 5:43 p.m. in Hong Kong after earlier rising 0.1 percent. Seven of the 10 industry groups on the gauge declined.

“The market lacks catalysts,” said Junya Naruse, chief strategist at Daiwa Securities Group Inc., Japan’s second- largest brokerage. The situation in Thailand “doesn’t impose much of a geopolitical risk, but it still weighs on the market when it doesn’t have other catalysts.”

Thailand’s SET Index fell 1.1 percent, for the biggest drop since May 8, as the army acted after months of political turmoil that brought down an elected leader and tipped the economy into a contraction.

Japan’s Topix index rose 0.3 percent, rebounding from a one-month low. The Bank of Japan began a two-day policy meeting today. South Korea’s Kospi index lost 0.2 percent. Australia’s S&P/ASX 200 Index gained 0.2 percent and New Zealand’s NZX 50 Index slipped 0.6 percent.

Regional Gauges

Hong Kong’s Hang Seng Index climbed 0.6 percent. The Hang Seng China Enterprises Index of mainland companies traded in the city fell 0.3 percent. The Shanghai Composite Index rose 0.2 percent, while Taiwan’s Taiex index slid 0.1 percent.

Singapore’s Straits Times Index added 0.1 percent after the nation’s gross domestic product expanded an annualized 2.3 percent in the three months through March from the previous quarter, when it climbed a revised 6.9 percent, the trade ministry said in a statement today. India’s S&P BSE Sensex Index was little changed.

China plans to have about 100 initial public offerings from June through the end of this year as the government pushes for development in capital markets. The stock sales will be spread out to ensure there are a similar number each month, China Securities Regulatory Commission Chairman Xiao Gang said in a statement posted on the regulator’s website yesterday.

U.S. Volume

Futures on the Standard & Poor’s 500 Index fell 0.1 percent. The equity measure added 0.4 percent yesterday as Internet and small-cap shares extended a rebound. About 4.9 billion shares changed hands on U.S. exchanges, the second- lowest level of the year.

Energy shares dropped the most among the 10 industry groups on the MSCI Asia Pacific Index. Coal India lost 5.1 percent to 369 rupees after surging 13 percent yesterday.

Yahoo Japan jumped 12 percent to 459 yen after canceling plans to acquire eAccess from SoftBank Corp. to focus on developing services as part of a strategy to expand into mobile. The Internet company’s rating was raised to outperform from neutral at SMBC Nikko Securities Inc.

Treasury Wine Estates Ltd. soared 18 percent to A$4.80 after rejecting a takeover offer from KKR & Co. The buyout firm, founded by Henry Kravis, made a preliminary cash offer on April 16 of A$4.70 a share, the Melbourne-based winemaker said in a statement today. That’s 27 percent more than its closing price of A$3.69 the day before the offer was received.

Among companies on the Asia-Pacific gauge that reported quarterly results through yesterday since April 1 and for which Bloomberg had estimates, about 50 percent beat profit expectations, according to data compiled by Bloomberg.

The Asia-Pacific gauge traded at 12.7 times estimated earnings compared with 16 for the S&P 500 and 15.1 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.