Asian stocks fell this week, with the regional benchmark gauge declining the most since August amid concern that improving US economic data will spur the US Federal Reserve to pare its stimulus program as soon as this month.
Toyota Motor Corp, a Japanese carmaker that gets 31 percent of its revenue in North America, sank 2.5 percent, as Qantas Airways Ltd slumped 16 percent after Australia’s largest carrier said it will post a record first-half loss and Standard & Poor’s cut its credit rating to “junk.” In Hong Kong, Standard Chartered PLC dropped 7.7 percent after the lender said full-year operating profit from consumer banking will decline at least 10 percent, hurt by its South Korean business.
The MSCI Asia Pacific Index retreated 1.8 percent this week to 139.47, the most since the week ended on Aug. 23. More than US$7 trillion has been added to the value of global equities this year — the most since 2009 — as central banks took steps to shore up economies.
However, the regional index has gained 7.8 percent this year amid the central banks’ stimulus and China’s economy showing signs of stabilizing. The gauge this week touched 14 times estimated earnings to reach the highest level since May, compared with multiples of 16.2 for the Standard & Poor’s 500 Index and 14.9 for the STOXX Europe 600 Index on Friday, data compiled by Bloomberg show.
In Taipei, the TAIEX fell 0.5 percent this week, after edging down 7.82 points to 8,367.72 on Friday, compared with 8,406.83 on Nov. 29.
Taiwan Semiconductor Manufacturing Co (台積電) fell 0.96 percent to NT$103 on Friday, while smartphone maker HTC Corp (宏達電) rose 0.34 percent to NT$147.5.
Elsewhere in the region, Australia’s S&P/ASX 200 Index declined 2.5 percent to post its biggest weekly slide since June, while the KOSPI lost 3.2 percent, Singapore’s Straits Times Index dropped 2 percent and New Zealand’s NZX 50 Index sank 1.7 percent.
In Japan, the TOPIX fell 1.8 percent. This year, Bank of Japan Governor Haruhiko Kuroda helped drive a 44 percent surge in the TOPIX by maintaining monetary easing as he and Japanese Prime Minister Shinzo Abe sought to jolt the nation out of 15 years of deflation. The index is the best-performing of 24 developed markets tracked by Bloomberg.
Companies that do business in the US fell. Toyota slid 2.5 percent to ￥6,220, while Nissan Motor Co declined 4.2 percent to ￥897.
Hong Kong’s Hang Seng Index slid 0.6 percent and China’s Shanghai Composite rose 0.8 percent.
Chinese President Xi Jinping (習近平) said the environment for economic and social development next year is not optimistic, in a signal that leaders may be willing to accept slower growth next year.
“While the overall situation is good, the environment for economic and social development next year is not optimistic,” Xinhua news agency said, paraphrasing Xi’s remarks.
He said reform should be integrated into all sectors.
Fed policymakers are to meet on Dec. 17 and Dec. 18 after minutes of their last meeting in October showed it may reduce its bond buying should the US economy improve.
The share of economists predicting that the Fed will taper bond purchases this month doubled after a US government report on Friday showed back-to-back monthly payroll gains of 200,000 or more for the first time in almost a year.
The Federal Open Market Committee will probably begin reducing the US$85 billion in monthly bond-buying at the meeting next week, according to 34 percent of economists surveyed on Friday by Bloomberg, an increase from the 17 percent recorded in a Nov. 8 survey.
The US in the last quarter posted the fastest annualized growth since the start of last year and jobless claims unexpectedly fell, reports showed this week.
Bill Gross, manager of Pacific Investment Management Co’s, the world’s biggest bond fund, said the unprecedented cash added to the financial system by central banks worldwide is raising the risk of a slide in global asset prices.
“Investors are all playing the same dangerous game that depends on a near-perpetual policy of cheap financing and artificially low interest rates in a desperate gamble to promote growth,” Gross wrote in his monthly investment outlook posted on California-based Pimco LLC’s Web site.
In other markets on Friday:
Manila slipped 0.27 percent, or 16.01 points, from Thursday to close at 6,014.94.
Mumbai rose 0.18 percent, or 38.72 points, to finish at 20,996.53.
Wellington eased 0.14 percent, or 6.43 points, to end on 4,713.52.