Asian stocks fell, with the regional benchmark index retreating from a two-month high, after a private survey showed China’s manufacturing contracting at a faster-than-estimated pace.
Jiangxi Copper Co. (358), China’s biggest producer of the metal, slipped 2.1 percent in Hong Kong. Kao Corp., a maker of household and chemical products, fell 4.5 percent in Tokyo after giving an update on a product recall. Murata Manufacturing Co., a Japanese supplier to Apple Inc., gained 4 percent after Apple’s profit topped estimates
The MSCI Asia Pacific Index fell 0.1 percent to 137.08 as of 11:59 a.m. in Tokyo, erasing gains of as much as 0.2 percent. About five shares declined for every three that rose on the gauge. The measure dropped 4.9 percent through yesterday from this year’s high on May 20 amid signs China’s economic slowdown is deepening and concern the Federal Reserve will start tapering monetary stimulus as the U.S. economy improves.
“We know China is slowing, but we just don’t know who to believe in China over whether we see sub-7 percent or 7 percent growth,” said Chris Weston, chief market strategist at IG Markets Ltd. in Melbourne. “The market globally, including emerging markets, has become a lot more comfortable with the tapering exercise and it’s not going to have massive negative ramifications for emerging markets and global equities.”
Japan’s Topix index lost 0.4 percent, while the benchmark Nikkei 225 Stock Average slipped 0.6 percent. Hong Kong’s Hang Seng Index dropped 0.3 percent and China’s Shanghai Composite declined 0.9 percent.
China’s manufacturing weakened further in July, signaling the worst of the nation’s slowdown has yet to be reached, according to a preliminary survey of purchasing managers.
The reading of 47.7 for an index released today by HSBC Holdings Plc and Markit Economics was less than estimated and if confirmed in the final report on Aug. 1, would be the lowest in 11 months. Readings below 50 indicate contraction.
Taiwan’s Taiex Index fell 0.3 percent, while Singapore’s Straits Times Index was little changed. Australia’s S&P/ASX 200 Index gained 0.2 percent, while New Zealand’s NZX 50 Index added 0.3 percent.
Shares on the MSCI Asia Pacific Index traded at 13.5 times estimated earnings as of yesterday, compared with 15.4 times for the Standard & Poor’s 500 Index and 13.4 times for the Stoxx Europe 600 Index.
Futures of the Standard & Poor’s 500 Index fell 0.1 percent today. The measure slid 0.2 percent in New York yesterday as investors weighed corporate earnings amid speculation on when the Federal Reserve may scale back its asset purchases. The Richmond Fed’s gauge of manufacturing in the mid-Atlantic region unexpectedly fell to minus 11 in July.
Apple, maker of the iPhone and iPad, rallied after the close of U.S. exchanges. The Cupertino, California-based company reported earnings of $7.47 a share in the quarter ended June 29, compared with an average analyst estimate of $7.30. Sales rose to $35.3 billion, beating a projection of $35 billion.