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Most Asian Stocks Fall Amid Economic Growth Concerns; Mining Shares Gain - Bloomberg

Most Asian stocks fell amid mounting speculation that the global economic recovery is faltering. Australian mining companies rose on speculation they will benefit from an election deadlock in Australia.
Canon Inc. and Honda Motor Co., which both get more than 80 percent of their sales outside Japan, lost more than 1 percent before reports this week that may reinforce concern the U.S. economy is weakening. China Petroleum & Chemical Corp. sank 2 percent after second-quarter net income fell. Rio Tinto Group, the world’s third-largest mining company, rose 1 percent in Sydney on speculation a proposed resources tax will be scrapped.
“Ultimately, the global backdrop will be the biggest driver of markets,” said Nader Naeimi, a Sydney-based strategist at AMP Capital Investors Ltd., which manages $90 billion. “You’re getting a sigh of relief on the Australian miners because of hopes the mining tax will be stalled.”
About five stocks fell for every three that rose in the MSCI Asia Pacific Index, which declined 0.1 percent to 118.12 as of 1:07 p.m. in Tokyo. A measure of material stocks in the index climbed 0.3 percent, the most among ten industry groups, while a gauge of consumer-related stocks slumped 0.7 percent.
Japan’s Nikkei 225 Stock Average fell 0.8 percent, while South Korea’s Kospi index was little changed. New Zealand’s NZX 50 Index slipped 0.5 percent. Australia’s S&P/ASX 200 Index lost 0.1 percent after the nation’s federal election failed to deliver a majority government for the first time in 70 years.
Futures on the Standard & Poor’s 500 Index added 0.2 percent. The gauge declined 0.4 percent on Aug. 20 as a drop in commodities pulled oil and metals producers down amid concern the economic rebound may be flagging.
Canon slumped 2.1 percent to 3,252 yen in Tokyo and Honda lost 1.3 percent to 2,783 yen.
A report tomorrow by the Chicago-based National Association of Realtors will show July sales of existing homes plummeted 12.9 percent from June, according to the median estimate of economists surveyed by Bloomberg. Concern over the global economy also deepened after Axel Weber, a European Central Bank council member, recommended helping lenders through end-of-year liquidity issues before determining when to withdraw emergency lending measures.
“The ECB official’s comments are making the market focus on Europe’s economic problems again,” said Yoshinori Nagano, a senior strategist in Tokyo at Daiwa Asset Management Co., which oversees $104 billion. “Uncertainty about the economic recovery is making the market wary of taking risks.”
China Petroleum, Asia’s biggest refiner, slumped 2 percent to HK$6.23 after saying second-quarter net income fell 10 percent to 19.68 billion yuan ($2.9 billion).
In Sydney, Rio climbed 1 percent to A$72.30 after the ruling Australian Labor party failed to win a majority at the weekend election, raising optimism its proposed mining tax may be scrapped or diluted. BHP Billiton Ltd., the world’s biggest mining company, gained 0.7 percent to A$38.17.
“We’re seeing some cautious optimism in major stocks like BHP and Rio,” said Tim Schroeders, who helps manage about $1.1. billion at Pengana Capital Ltd. in Melbourne. “There’s a glimmer of hope for the mining sector that things aren’t as dire as they appeared on Friday in terms of a mining tax.”
To contact the reporters on this story: Shani Raja in Sydney at sraja4@bloomberg.net; Monami Yui in Tokyo at myui1@bloomberg.net.

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